Anticorruption agents have arrested a former director of a West Java bank who was hiding out with a psychic in Banten province for his alleged role in a Rp 37 billion ($3.7 million) embezzlement case in 2003-2004, an official said on Friday.
In a statement, Chandra Hamzah, an official with the Corruption Eradication Commission (KPK), said Umar Syarifuddin, a former executive of Bank Jabar-Banten, was charged with violating the 2001 Corruption Law, which carries a maximum sentence of life imprisonment.
The KPK believes Umar instructed 33 branches of the regional bank to submit “tax administration fees and contributions” that properly belonged to the local government to the bank’s head office. The funds were allegedly channeled into Umar’s personal account.
Umar was declared a suspect on May 7 but he disregarded two summons from the commission earlier this month and he was declared a fugitive.
KPK investigators said he had fled his Bandung home and they investigated the residence for clues.
“His family was not being cooperative,” KPK spokesman Johan Budi said, adding that the commission got a break in the case when neighbors told them that Umar had sought refuge with a psyc h ic in Rangkas Bitung, Banten. “He had been there for 10 days,” Johan said.
After his arrest, Umar was taken to the KPK headquarters where he was questioned on Thursday evening before being sent to the Cipinang detention facility in East Jakarta.
In the wake of the arrest, the KPK announced on Friday that it was cooperating with the central bank to monitor the use of provincial, district and city money deposited in local banks.
“A lot of corruption has taken place by misappropriating local funds,” KPK deputy for graft prevention Haryono Umar said. “We are asking that these funds be monitored so that they are not channeled to personal accounts of rogue officials.”
Haryono said a KPK team working at Bank Indonesia “will ensure that all local funds are remitted to local coffers.”
“If there are indications of graft, the KPK will investigate,” Haryono said. Under the 2004 Law on Regional Autonomy, the central government has allowed local authorities to manage their own budgets.
However, with little supervision from the central government, corruption by local officials has become widespread, investigators say.