CONSPIRACY IN GOVERNMENT PROCUREMENT IN INDONESIA
Amir Nurdianto＊

I. FOREWORD
Criminal provisions regarding corruption in Indonesia are regulated in Law no. 31 of 1999 on the Eradication of Corruption which was subsequently changed and supplemented by Law no. 20 of 2001. Legally,
formulation and types of corruption regulated in Law no. 31 of 1999 in conjunction with Law no. 20 of 2001
can be grouped as follows:⿟⿟ Any person who unlawfully enriches him- or herself or another person or a corporation (Article 2)
⿟⿟ Civil servants or state officials misusing authority to enrich themselves or another person or a
corporation (Article 3)
⿟⿟ Everyone who participates in bribery (giving or promising anything) to civil servants or state
officials, judges, lawyers (Articles 5 and 6)
⿟⿟ Business entities or individuals committing skullduggery (Article 7)
⿟⿟ Civil servants or state officials, individuals, or notaries who embezzle, falsify, eliminate, or destroy
money, goods, certificates, letters or administrative lists (Articles 8, 9 and 10)
⿟⿟ Civil servants or state officials, individuals accepting a gift or pledge (Articles 11 and 12)
⿟⿟ Civil servants or state officials committing gratification (Article 12B)
⿟⿟ Any person who gives a gift or promises something to civil servants (Article 13)
⿟⿟ Other crimes related to corruption (Articles 21, 22, 23 and 24)
The laws regarding government procurement in Indonesia start with the release of Presidential
Decree no. 80 of 2003 and others that now apply are Presidential Regulation no. 54 of 2010 which is thenadjusted by Presidential Regulation no. 35 of 2011 (first amendment) and Presidential Regulation no. 70 of2012 (second amendment).
According to article 1, point 1 of Presidential Regulation no. 54 of 2010, government procurement is anactivity to obtain goods or service by ministries, agencies, local work units, or other institutions where theprocess starts from planning needs until completion of all activities to acquire goods or services.
Normatively, as stipulated in article 5 of Presidential Regulation no. 54 of 2010, principles of government procurement are efficient, effective, transparent, open, competitive, fair or not discriminatory and accountable. Those principles serve as general guidelines in implementation of government procurement inevery stage of procurement carried out by respective government agencies.
In practice, in Indonesia government procurement is often seen as a process prone to acts of corruption with various types and modes of irregularities committed by parties associated with the process ofgovernment procurement. The process of government procurement is often used as a means to obtain
Investigator and Prosecutor at the Corruption Eradication Commission (CEC), Indonesia.

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personal or a group benefit by ignoring principles of government procurement that ultimately lead tofinancial losses to the state.
Based on the data handling of corruption cases by the Corruption Eradication Commision in the period
2004 until June 2016, 148 cases out of 514 cases handled by the CEC are corruption related to government
procurement.
Corruption related to government procurement that has been identified is only part of the entire corruption related to government procurement occurring throughout Indonesia. That is, there is still a lot of
corruption in government procurement which has not been revealed.
The government procurement process in Indonesia implemented in all sectors of development isscattered among various government agencies either at the central level or at regional level with a rangeof value scales of work budget. Supervision and control efforts over the government procurement process
become very essential in order to prevent occurence of deviations which may result in leakage of budget
to interests of a few people or certain groups. In addition, law enforcement efforts against the occurenceof irregularities classified as corruption in government procurement also play an important role to provide
a deterrent effect and demand accountability to individual perpetrators, and to maximize efforts to recoverlosses to the state caused by corruption in government procurement.
Therefore, the role of law enforcers becomes very important to be able to find and deal with corruption in government procurement as part of the effort to combat corruption and maximize efforts torecover losses to the state, and ensure that the government procurement process can run according toprinciples of government procurement for implementation of national development, for the benefit andwelfare of all people of Indonesia.

II. MAIN DISCUSSION
A. Irregularities in the Implementation of Government Procurement
Corruption may occur in the stages of government procurement process from the budget planningstage, planning and preparation of procurement, implementation of procurement activities, handover ofgoods or services, payments as well as inspection or audit on the implementation of government procurement.
The pattern of irregularities that may occur in the government procurement stage which leads to corruption include:⿟⿟ The preparation stage of procurement: for example the procurement planning activities inflate
costs (mark up), directed to the interests of a product or provider of certain goods and services,
unrealistic planning particularly from the point of execution time, the committee works behindclosed doors, dishonest and controlled by certain parties, owner estimate (OE) is covered up whenit should not be confidential, the base price is not standardized, technical specifications lead to a
specific product, not standardized tender documents, tender documents are not complete.
⿟⿟ Stage of the procurement process: for example the announcement period is too short, material ofannouncement is incomplete and confusing (ambiguous), dissemination of flawed tender
documents, during the pre-bid (aanwijzing) there are information restrictions by the committee sothat only a certain group obtains complete information, the pre-bid (aanwijzing) was changed into
a question and answer session, an attempt to block entry bid documents by certain elements sothat certain participants are late in submitting a bid sheet, on the bid evaluation activities subtitution of documents is done by inserting a revised document into the initial document, thecommittee works behind closed doors, announcement of winning bidder only to a specific group,
not entire refutation get response, sending of determination letter intentionally delayed in orderto get kickbacks.
⿟⿟ Drafting and signing of the contract: for example signing of the contract without supporting
documents (fictitious documents), the signing of contract is delayed due to performance bond that212

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does not exist.
⿟⿟ Execution of the contract and delivery of goods and services: for example, the goods delivered
are not in accordance with specifications defined in the contract, signing of minutes of handoverwhen work has not been completed, inspectors do not supervise properly and accidentally allow
cheating conducted by the supplier.
Based on case studies of corruption in government procurement handled by the CEC, it can be identified that the problems surrounding government procurement are due to irregularities in the planning, implementation and monitoring or accountability of government procurement. Characteristics of corruptionthat commonly occur in government procurement that had been handled by the CEC, among others, are:⿟⿟ Goods or services which are held genuinely not needed or not in accordance with requirements
but a booking and deposit from the interested parties is not planned based on real needs.
⿟⿟ Specification of goods and services and owner estimate that should be made by procurement
committee actually is a specification that is directed at a particular brand, at a price regulated
and determined by interested parties. which inflates costs (mark up) or deflates costs (markdown) to benefit certain parties.
⿟⿟ Auction is supposed to be fair, open and based on competence but is instead set according to thescenario for the benefit of certain parties.
⿟⿟ Acceptance of a sum of money or goods in return (kickback) from provider of the goods to thesponsor, brokers and certain officials which led to the price of goods or services being increasingly bloated.
⿟⿟ Giving money or goods at a certain percentage, according to the value of government procurement projects, as a deposit or a tribute that must be paid by the procurement committee andproject leader to superiors under the pretext as tactical funds or operational funds for the organization spending purposes.
B. Handling Corruption Related to Government Procurement
Tackling corruption related to government procurement is required to have sufficient understanding ofprinciples and stages in government procurement in accordance with applicable provisions. Understanding
and capability that will be necessary to be able to identify irregularities in the government procurement
process is indicated as a form of corruption.
The process of building a case (case building) begins with handling of information (information
handling) over allegations of corruption in government procurement. Information received should be immediately analysed to determine its quality by analysing the qualifications of information sources and reliability.
Information about alleged corruption in government procurement can be obtained from several sources
including members of the procurement committee, the internal auditor or other internal source aware of
any irregularities in the government procurement process, bidders who feel disappointed because they
were treated unfairly in the process of government procurement, members of the non-governmental organizations or journalists who find indications of irregularities in the government procurement process,auditor- or examiner-found irregularities in the government procurement process which was examined orother parties. Information about alleged corruption in government procurement can also be obtained fromthe documents in the form of budget documents, government procurement schedules, government procurement announcements, government procurement documents, agreement documents or the government
procurement contracts, documents of audit reports or examination report documents and otherdocuments.
Furthermore, based on preliminary information about the alleged corruption in government procurement drafted several alternative of legal construction based on variety of possible irregularities in govern213

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ment procurement which indicated as a form of corruption with attention to some point mark indicationthat may occur at any stage of process of government procurement.
The next step is collection of information material to reinforce an allegation or hypothesis on the indication of corruption in government procurement. Based on data and information collected, the mostpowerful legal construction to be proven on alleged acts of corruption in the government procurement isdrawn.
The collection of information wherever possible should be conducted by not reaching out to the parties
allegedly involved. Methods of collecting information among others can be done by finding and analysing
information from open sources such as information and data that are open to the public or accessible tothe public either directly or via internet such as auction announcements, auction winners, the announcement of procurement schedules and others. Collection of information may also be done by confirmation
with information sources (complainants) or others who can be trusted after identification of information
sources, or by direct observation of results of implementation of government procurement. Having
obtained information about alleged corruption in government procurement and having gained confidenceof the quality of information sources, the information can be improved in the preliminary investigation
stage.
In the preliminary investigation stage, collecting information can be either closed or open which
includes conducting interviews or inquiries to the parties associated with the government procurement
process, clarifying testimony and documents that have been obtained, and analysing documents related togovernment procurement. Collection of information in this stage is intended to strengthen the legal construction that has been built by finding two items of evidence sufficient to corroborate their allegations on
corruption in government procurement.
Collection of information at the level of investigation conducted openly with the aim of gathering sufficient evidence for fulfillment of elements in order to prove the alleged corruption in government procurement. The collection of information made through examination of witnesses, examination of suspects,
expert examination, requesting data and financial transactions from financial service providers, asset
tracking and a series of legal actions in the form of searches and seizure of evidence.
Efforts to collect evidence through a search related to government procurement are principally
directed at main targets such as unit work offices or agencies in which the procurement process was
carried out, offices of partners (the company winning the auction, auction participants, companies
companion, suppliers, as well as broker offices) and suspect residences, and other places deemed necessary.
Search of offices or the implementing government procurement agency directed at the workspace of
procurement officials (officials, procurement committee, admissions committee) with the goal of documents
and files related to the procurement process and acceptance, mailing administration staff room, official
secretary, finance and treasurer targeting the documents and files related to correspondence, financialtransactions and payments, as well as other locations deemed necessary.
Searches in associate companies directed at boardrooms or company policymakers with target
documents and files of strategic policies and agreements related to government procurement being
followed, meeting rooms and secretary rooms targeting the minutes of meetings, marketing staff room
and administration staff targeting the bid price and specification of goods, sales staff room, purchasing staff
and inventory staff with the goal of documents and files related to sales, booking or purchase of goods andinventory records, finance staff room and accounting staff room targeting the documents and files related
to financial transaction bookkeeping and company financial statements, as well as other locations deemednecessary.
Asset tracking in the form of cash, deposits, savings and other cash equivalents done as early as
possible when the investigation was started because demand for such information requires considerable
time and has a dependency on other parties such as financial service providers and Indonesian Financial
Transaction Reports and Analysis Center (INTRAC). There is a need to build an integrated working
system between investigators, financial service providers and INTRAC by assigning personnel who are21419TH UNAFEI UNCAC TRAINING PROGRAMMEPARTICIPANTSʼ PAPERS
given specific responsibility to bring together and coordinate related to the financial data request so that
all the information urgently needed by investigators and the progress of producing it can be tracked byfinancial service providers and INTRAC.
Blocking of assets is carried out if assets were found allegedly to originate or are the result of corruption that is obtained in tempus relevant to acts of corruption, acquisiton process involving the parties
related to the corruption that occured and other factors.
Proving corruption in goverment procurement in Indonesia is basically the same as proving of crimes
in general which is looking for material truth that is not only based on evidence submitted formally by the
public prosecutor or the accused but pursued to find the real truth. Judges shall explore and work on theevidence submitted in order to prove that what the accused is charged with actually happened and thatthe offender is accountable for the actions.
This begins with proving the facts of the accused actions followed by application of material criminal
law namely proving facts that such actions meet the elements of the offences charged. This is done in twostages:⿟⿟ Disclosure of the facts by applying the law of criminal procedure, in this case the law of evidence.
⿟⿟ Analysis of the facts that have been proven by applying the facts to the elements of the offencescharged under the theory of criminal law (material criminal law).
Judges in adjudicating should be able to consider the facts revealed at the hearing, analyse carefully
whether there is a causal relationship between the facts that occured with actions of the accused, thus
reaching the conclusion that under provisions of law such acts as indicted have been proven legally andconvincingly. Rules governing such evidence are referred to as the law of evidence.
Evidence and strength of evidence in corruption cases in Indonesia is regulated in Article 26 and 26 A
of Law no. 31 of 1999 as amended by Law no. 20 of 2001.
The strategy of criminal prosecution of corruption cases no longer uses conventional ways to pursue
perpetrators but changes the paradigm to put forward pursuit of wealth proceeds of corruption. Imprisonment of perpetrators is still required but chasing wealth and impoverishing the accused have more preventive properties.
Referring to the United Nations Convention Against Corruption in 2003 and ratified on April 18, 2006
through Law no. 7 of 2006 on Ratification of the United Nations Convention Against Corruption in 2003 inIndonesia, several laws related to asset confiscation of proceeds of crime were enacted. Legislation among
others are as follows:⿟⿟ Law no. 31 of 1999 as amended by Law no. 20 of 2011 on the Eradication of Corruption
⿟⿟ Law no. 15 of 2002 as amended by Law no. 25 of 2003 on Money Laundering which has been
repealed with the enactment of Law no. 8 of 2010.
The hunt for the proceeds of corruption started since investigation by seizing property associateddirectly or indirectly with corruption and expanded efforts of the imposition of sentences for additional
compensation. Implementation of the criminal verdict of additional compensation has not taken precendece
on implementation of imprisonment in lieu of criminal verdict additional compensation but is more aimed
at authority to seize, auction off property belonging to the convicted for payment of compensation.
International cooperation for purposes of seizure and asset recovery as defined in the United Nations
Convention Against Corruption needs to be realized with the countries concerned even though it is noteasy to do because of the national interests of each country.

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III. CONCLUSION
A. The pattern of tackling corruption in goverment procurement must be in accordance with and understand the pattern of irregularities in implementation of government procurement. Handling of corruption
in government procurement is one of the repressive efforts of law enforcement in order to eradicate corruption that not only aims to provide a deterrent effect and prosecute criminal responsibility of the perpetrators but also aims to maximize efforts to recover losses to the state arising from acts of corruption.
B. Prosecution of corruption cases of government procurement that is proportional and professional
demands application of the law of evidence in disclosure of the facts and application of material criminal
law, comprehension of interpretation or understanding of the elements of the crime and also the prosecutorial strategy of deprivation of the wealth of the accused.

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