Jafar was arrested on May 4, 2002 in Surabaya as he was en route from Ambon. On October 2002, Laskar Jihad was officially disbanded by the staff and board of supervisors of FKAWJ after a marathon meeting from October 3 to October 7, 2002. Jafar Umar Thalib disagreed with the board's decision as he was still in litigation with the East Jakarta District court where he was indicted for acts of treason, inciting, and insulting Indonesian President at that time, Megawati Sukarnoputri. Jafar obliged to announce the dissolution of Laskar Jihad when reporters asked for confirmation moments after the first Bali bombing on October 16, 2002. However, Jafar apparently still tried to gather troops to perform demonstrations so that he could press the District Court to ease his sentence. However it turned out with the dissolution of the Laskar Jihad, he was ultimately acquitted. According to the judge panel, there was no proof that Jafar had insulted or defamed Megawati Sukarnoputri, inciting the masses, and for his call for hostility in his speeches at "al-Fatah Mosque" in Ambon, 26 April 2002. Later he was freed from all charges on January 30, 2003.