VZCZCXRO0195
PP RUEHCHI RUEHCN RUEHDT RUEHHM
DE RUEHJA #1465/01 2130901
ZNR UUUUU ZZH
P 310901Z JUL 08
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC PRIORITY 9678
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS
RUEHBY/AMEMBASSY CANBERRA 2839
RUEHLM/AMEMBASSY COLOMBO 1162
RUEHKA/AMEMBASSY DHAKA 1132
RUEHNE/AMEMBASSY NEW DELHI 2062
RUEHKO/AMEMBASSY TOKYO 2294
RUEHWL/AMEMBASSY WELLINGTON 2898
RUEHHK/AMCONSUL HONG KONG 2850
RUEHPT/AMCONSUL PERTH 1003
RUEAIIA/CIA WASHDC
RUEAWJB/DEPT OF JUSTICE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RHEFDIA/DIA WASHINGTON DC
RHMCSUU/FBI WASHINGTON DC
RHEHNSC/NSC WASHDC
RUEKJCS/SECDEF WASHDC
RHHJJPI/USPACOM HONOLULU HI

UNCLAS SECTION 01 OF 02 JAKARTA 001465 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR EAP, EAP/MTS, EAP/MLS, INL 
INL FOR SNYDER/BARCLAY 
DEPT FOR EEB/IFD/OMA 
DOJ/OPDAT FOR LEHMANN/ALEXANDRE/JOHNSON 
SINGAPORE FOR BAKER 
NSC FOR E.PHU 
 
E.O. 12958: N/A 
TAGS: PGOV KJUS KCOR ID
SUBJECT: CONVICTION IN MAJOR CORRUPTION CASE 
 
REF: A. JAKARTA 1306 
     ¶B. JAKARTA 1098 
     ¶C. JAKARTA 595 
 
JAKARTA 00001465  001.2 OF 002 
 
 
¶1.  (U) This message is Sensitive but Unclassified -- Please 
handle accordingly. 
 
¶2.  (SBU) SUMMARY:  Indonesia's Corruption Court has 
convicted Artalyta Suryani--a well-known socialite and 
influence peddler--of bribing a (since fired) state 
prosecutor in order to close down a key corruption 
investigation.  The case is linked to massive financial fraud 
at Bank Indonesia in the late 1990's and early 2000's (the 
case is commonly referred to as "BLBI" based on the 
Indonesian acronym).  The GOI is continuing another major 
trial linked to the BLBI case.  The Attorney General,s 
Office is under pressure to re-open all aspects of the BLBI 
investigation.  The conviction of a key influence peddler is 
positive news for the GOI's anti-corruption efforts.  END 
SUMMARY. 
 
A KEY CONVICTION 
 
¶3.  (U) There has been an important corruption conviction in 
Indonesia.  On July 29, the Corruption Court unanimously 
convicted Artalyta Suryani of bribing state prosecutor Urip 
Tri Gunawan, who had led the Attorney General,s Office (AGO) 
investigation into the misappropriation of BLBI funds. 
(Note:  The BLBI case involves emergency liquid credits 
extended by Bank Indonesia, the central bank, to commercial 
banks during the financial crisis, which began in 1997.   Of 
the $16 billion BLBI loans issued since 1997, approximately a 
third turned bad. End Note.) 
 
¶4.  (U) According to the evidence presented, the $660,000 
bribe took place two days before the Attorney General,s 
Office suddenly dropped its investigation of a key aspect of 
the BLBI case (ref C).  Due to this suspicious action, the 
GOI launched an investigation, finding that Suryani had given 
the prosecutor the huge bribe in exchange for wrapping up his 
investigation.  As part of the Court's ruling, Suryani was 
sentenced to five years in prison and fined.  Suryani now has 
seven days to appeal the decision.  Gunawan also faces 
charges of accepting bribes and extortion. 
 
¶5.  (U) In the meantime, the Supreme Court on July 11 
suspended a west Jakarta district court judge after he was 
found guilty of requesting a bribe from Suryani. 
 
A RELATED TRIAL TO CONTINUE 
 
¶6.  (U) A trial involving another strand of the BLBI matter 
is set to continue.  The Corruption Court has determined it 
will continue with the trial of former Bank Indonesia 
governor Burhanuddin Abdullah for the misappropriation of $11 
million in funds (ref A).  Former deputy governors Bun Bunan 
Hutapea, Aslim Tadjuddin and Aulia Pohan--father-in-law of 
one of President Yudhoyono,s sons--were also implicated in 
the case, although they have not yet been named suspects. 
The funds were allegedly disbursed to members of the House of 
Representatives (DPR) and former Bank Indonesia officials. 
 
ATTORNEY GENERAL'S OFFICE UNDER PRESSURE 
 
¶7.  (SBU) The Attorney General,s Office is under pressure to 
re-open its BLBI investigation.  The stunning fact that one 
of its prosecutors took a bribe to shut down a case has 
 
JAKARTA 00001465  002.2 OF 002 
 
 
proven a severe embarrassment, and the Attorney General is 
hard at work trying to restore his and his organization's 
credibility.  The case is critical for Indonesia's 
anti-corruption effort because it has many tentacles, 
involving so many in the elite world of business and 
government.  The fact that a key influence broker has been 
convicted is a big positive.  That said, the Suryani aspect 
of the case seems to be just the tip of the iceberg. 
HUME