To Reform the United Nations, BDF Needs Global Support

Jakarta Globe, Pitan Daslani, November 11, 2012

A more democratic United Nations was on the agenda of the Bali Democracy
 Forum attended by leaders such as Indonesian President Susilo Bambang
Yudhoyono,  Australian Prime Minister Julia Gillard, Afghan President Hamid Karzai
 and Turkish Prime Minister Recep Tayyip Erdogan. (AFP Photo/Sonny Tumbelaka) 

   

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The issue of reforming the United Nations Security Council loomed large during the two-day Bali Democracy Forum, which was attended by 11 heads of state and government.

The essence of their speeches on this particular topic was to restructure the council, or UNSC, to the extent that it represents “actual realities” of the present-day global constellation so that the world’s most powerful authority is not “undemocratically controlled” only by the five permanent members, often referred to as the “Perm Five.”

Turkish Prime Minister Recep Tayyip Erdogan recognized that the current constellation of the UNSC was the result of a global power imbalance in the aftermath of World War II. Now that this reason is out-dated, he said, it is time for the council to be restructured.

Afghan President Hamid Karzai also spoke about the need to overhaul the UN system and make it more democratic because the current constellation is “no longer suitable” for present-day realities.

Indonesian President Susilo Bambang Yudhoyono gave a broader perspective on the issue and emphasized the need to democratize the United Nations to the point that it reflects the globe’s potential strengths in all fields. This would include rewriting the criteria for membership to the UNSC.

To do so, the UN Charter must be amended. And that is where huge problems arise. If amending a country’s constitution is a big and very sensitive issue, more so is the proposition to amend the UN Charter.

Where to begin? Who will have the authority to conduct reform? And, the most crucial question is, how to get the United States, Russia, China, Britain and France to agree to relinquish their exclusive veto rights? These states would then no longer enjoy the exclusivity of such rights and be “downgraded” to the level of ordinary, non-permanent members. Reforming the UNSC would mean scrapping exclusive rights and sharing them with the rest of the UNSC members.

What the Bali Democracy Forum leaders had in mind was that if the UNSC could be reformed, it should begin by abolishing the distinction between permanent and non-permanent membership, thereby sharing the exclusive veto right equally among all members as a matter of democratic fairness.

The next step would be to rewrite the criteria for obtaining UNSC membership status.

That should reflect the real strength of the world, from economic to socio-demographic, technological, geo-strategic and soft-power excellence, and not merely based on perception of a country’s military strength, which is how it has been done for nearly seven decades.

Idealistically, that would usher in a more balanced global order in which key decisions on global peace, security, governance and economic policy formulation are made democratically by a reformed UN whose resolutions would no longer be suspected of advancing or siding with the agendas of certain countries.

In step with such endeavors, the UN General Assembly must be given greater authority to establish a “democratic superbody” under its auspices with the mandate to appoint the right people to lead various international agencies such as the World Bank, International Monetary Fund and all UN organs.

The conduct of the assembly, or UNGA, itself needs to be reformed so that it no longer becomes a forum for adversaries to attack each other, as in the ugly annual shows by warring countries, or those involved in various kinds of undeclared, yet open, war.

Delegates to UNGA should be required to present their best practices so others can learn from and their concerns and propose solutions to global problems affecting their existence.

That way, the UNGA could become an annual forum for obtaining answers and solutions instead of a platform for displaying hegemony, hatred, provocation and enmity. What a wonderful world the final outcome would be! In fact, US President Barack Obama has for some time envisaged such a UN. But for now, these reforms remain in my daydreams after reading the speeches of the Bali Democracy Forum leaders.

The speeches taught me to dream about a new world in which the UN is the peacemaker and problem-solver for its member countries. I was taught by those speeches to smile optimistically at future harmonious international relations, rather than frowning at the current realities.

But after a while, I realized that none of what those leaders were saying about UN reform during the forum was actually new.

Even as early as 1992, when leaders of the Non-Aligned Movement (NAM) gathered for their 10th summit in Jakarta, they had already issued a joint declaration that aimed to, among other things, reform the UN.

Even before that, Ali Alatas, who served as Indonesia’s foreign minister from 1988 to 1999 and was very well respected for his diplomatic acumen, strove through various international forums to achieve a consensus for reforming the UN.

Alatas — who co-chaired the Paris International Peace Conference on Cambodia with then-French Foreign Minister Roland Dumas and was the spokesman of the Third World Group of 77 for talks with advanced countries — used Asean, the Group of 77, NAM, the Organization of the Islamic Conference (OIC) and other forums to advance this goal. And yet untilhis death, he had not seen his painstaking efforts come to fruition.

The global power constellation remains undemocratic despite the rhetoric of those self-proclaimed “champions of democracy.” It is a big illusion to expect the Bali Democracy Forum to correct the situation by relying on its own network.

BDF needs to be expanded to include the United States, Russia, China, Britain and France as permanent participants, as well as other regional powers such as Brazil and Mexico to represent South America; South Africa, Egypt and perhaps Nigeria or other strong economies on the African continent; as well as Germany, Canada and OIC members.

Besides, leaving NATO members out of the picture would be counterproductive — if indeed reforming the UNSC is part of the goal that BDF leaders had in mind during their Bali meeting. The time is right because NATO does not have an enemy today to justify its huge weaponry.

Before talking about reforming the UN what BDF must do is strengthen its membership network to represent the actual strength of international constellations so that its aspirations can be supported by those participants that represent the majority of global strength.

But that alone is not enough. How the BDF can amend the UN Charter and reform the UN is a wilderness that has yet to be explored.

Perhaps it will remain in my daydreams for many more years until I give up and acknowledge that this is not simple work that can be solved through a loose forum’s appeals and declarations.

The world needs a new democratic conscience movement to push such strategic issues forward. And it needs great statesmen to make it happen.

The next BDF needs to go a lot further than just a collection of keynote speeches. The forum must attract other centers of power so that they too may lend a helping hand in creating a more balanced global order.

Pitan Daslani is a senior political correspondent at BeritaSatu Media Holdings, of which the Jakarta Globe is a subsidiary. He can be reached at pitandaslani@gmail.com

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Indonesia’s PT Bumi Starts Probe Following London Investigation

Jakarta Globe, November 09, 2012

Bumi Resources' coal mine in East Kalimantan. The Indonesian company is the
biggest producer of coal in the country. (Photo Courtesy of Bumi Resources)

  

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Indonesia’s PT Bumi Resources, the nation’s biggest producer of power-station coal, said a South Jakarta court has approved an independent investigation into its financial accounts dating back to 2010.

The investigation was prompted by the company’s audit committee “in view of the public notifications by a shareholder, Bumi Plc, and various reports, both in international and local media,” the Jakarta-based coal producer said on Friday in an e-mailed statement.

Reports are due to the Chief Justice of District Court of South Jakarta within 90 days of the appointment of an auditor, it said.

PT Bumi is part-owned by the Bakrie family and is at the center of a feud involving London-listed Bumi Plc, owner of 29 percent of the Indonesian mining company, and Bumi Plc co- founder Nathaniel Rothschild.

Bumi Plc, which has lost 70 percent in trading this year, in September started an urgent probe into “potential financial and other irregularities” at its Indonesian operations, PT Bumi and PT Berau Coal Energy Tbk.

The so-called forensic audit will focus on the accounts for the financial years of 2010 through 2012, PT Bumi said.

The Indonesian company referred to funds from unit PT Bumi Resources Minerals that are invested in United Overseas Bank Ltd. without giving further details of the probe.

An official at London-based Bumi Plc declined to comment.

The Indonesian investigation comes as Bumi Plc studies alternative proposals for its assets from two of the key parties who founded it in 2010, Rothschild and the Bakrie Group.

Rothschild, 41, has appointed Morgan Stanley to advise him and held talks with potential new investors as well as current holders of Bumi, a person familiar with the matter said last week.

An offer from the scion of a centuries-old banking dynasty would counter a $1.2 billion proposal from the Bakries for Bumi Plc’s stakes in two coal producers — its holding in PT Bumi and the 85 percent it has in PT Berau Coal Energy.

The Bakries made their offer last month to help resolve “irreconcilable differences” with Rothschild. The financier has described the Bakries’ offer as not being in the interests of investors.

Bumi dropped 2.5 percent to 266.9 pence at 1:10 p.m. in London. Bumi Resources was unchanged at Rp 650 on Friday in Jakarta and Berau Coal Energy was also unchanged at Rp 220.

Bumi Plc said Sept. 24 it was starting a probe into potential financial “irregularities” at its Indonesian investments. The probe is linked to a $637 million writedown of development funds and exploration assets in Bumi’s Dec. 31, 2011, year-end financial statement.

London-listed Bumi won’t make a recommendation on any possible transaction until the investigation is “appropriately advanced,” the company said Nov. 5.

Bloomberg

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Alarmingly High Rate of Disputes Reported Between Oil Palm Firms, Locals

Jakarta Globe, Tunggadewa Mattangkilang, November 07, 2012

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Balikpapan, East Kalimantan. Most of the oil palm companies operating in West Kutai District, East Kalimantan, stand accused by local residents of some kind of land infraction, the national human rights body revealed on Tuesday.

Mimin Dwi Hartono, the head of a team from the National Commission for Human Rights (Komnas HAM) investigating the residents’ grievances, said that “almost all” of the 45 companies were caught up in disputes and even conflicts with the locals.

“From our observations in West Kutai, these companies are at loggerheads with indigenous communities, including in the upstream Mahakam and Muara Tei areas, where both sides are actually engaged in conflicts,” he said in Balikpapan.

He added that in most cases, the underlying cause of the tensions was the fact that the companies were operating in areas that the communities had long considered their ancestral land, but for which the locals had no title deeds.

Mimin said that even though the companies had legitimate permits to operate there, they should do more to communicate their intent to the locals so that the latter would be aware of what was going on.

He added that in other cases, the companies only had preliminary permits to survey the areas, but had proceeded with clearing the land and planting.

In a few cases, he went on, the companies appeared to be selling the timber from the trees that they cut down, in violation of the terms of their planting permits.

“We believe that these kinds of companies are just there to illegally log the valuable tree species that West Kutai still has a lot of,” Mimin said.

The Komnas HAM team also raised suspicions that some of the ongoing disputes were actually stoked by the companies, who would pit one community against another over the issue of their shared border, and profit from the ensuing confusion to illegally expand their concessions.

Mimin urged the district authorities to weigh their decisions to award oil palm concessions more carefully. He warned that if permits continued to be issued at the current rate, West Kutai would lose a significant amount of its forest cover.

This, he said, could lead to massive flooding and severe landslides, given that much of the district acts as a catchment area for the Mahakam River.

Komnas HAM will use its findings to lobby for greater protections for forest residents under the indigenous communities bill being drawn up in Jakarta, as well as a curb on the discretionary power of district heads to issue plantation, mining and logging permits.

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Britain owed millions for weapons used by autocratic regimes

Campaigners call for end to 'unjust poor country debts' after government figures show arms were used against civilians

guardian.co.uk, Richard Norton-Taylor, Tuesday 6 November 2012

Former Indonesian president General Suharto. Britain lent the country
 more than £630m at a time when Suharto was stifling demonstrations.
Photograph: AP

Britain is owed hundreds of millions of pounds of unpaid debt on loans to autocratic governments in Argentina, Indonesia, Iraq and Zimbabwe for UK weapons and equipment that were used against civilians, an analysis of figures released by the government show.

Britain lent Indonesia more than £630m to pay for British arms provided to General Suharto at a time when he was repressing protests. Some of the weapons, including armoured cars and jet aircraft were used in the 1990s against civilians in what is now East Timor, the former foreign secretary, Robin Cook, admitted at the time.

Up to £50m was lent to the Argentine junta to buy British arms before the invasion of the Falklands in 1982. They included two Type 42 destroyers, two Lynx helicopters, and 22 Sea Dart missiles, according to documents in the National Archives discovered by the Jubilee Debt Campaign (JDC), which is calling for an end to what it calls "unjust poor country debts".

One of the Lynx was the first Argentine aircraft to land on the Falklands after the invasion.

The government lent £12m for the export of Land Rovers to President Robert Mugabe of Zimbabwe. The vehicles were supplied after he promised they would be used "with due respect for human rights". He said he would not use them for riot control, but Amnesty International said vehicles were used to crush demonstrations.

Some £100m of unpaid loans were originally provided to Egypt under the former president Hosni Mubarak to buy British weapons; £5.5m of unpaid loans were provided to Saddam Hussein's Iraq then engaged in a war of attrition against Iran.

A proportion of the loans to Indonesia have recently been settled, though the country still owes £400m, most of which comprises debts for the purchase of British weapons, according to official figures.

Tim Jones, policy officer at JDC told the Guardian on Tuesday: "For years the UK government has claimed it is not possible to find out where debts come from. The figures released today show this was a lie. They reveal a history of horrendous loans to dictators such as General Mubarak, General Suharto and Saddam Hussein for military equipment. People in these countries should not have to pay these unjust debts."

The UK government is demanding Egyptian people pay the debt inherited from General Mubarak and £14m will be paid this year, according to the JDC.

The figures are included in a report on sovereign debt data by UK Export Finance, part of the Department for Business. It is the first time the department has disclosed such country-by-country figures.

Indonesia tank deal raises moral questions

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Among the loans underwritten by the Export Credits Guarantee
Department  was one for £35m to Robert Mugabe's Zimbabwe for
the purchase of five of BAE Systems' Hawk fighter jets. 
Photograph: PA

"Healing the Military Energies in our family Tree" – Jun 13, 2011 (Kryon channelled by David Brown)

“… Most of the indigenous people of the world no longer exists. Tens of millions of indigenous people that were connected to the Divine have been wiped from the face of the Earth; and that includes the Europeans, the indigenous Europeans. What commands the Earth plane today is the pure masculinity, symbolized by the obelisk, where there is no love; pure masculinity and no love. As you remember early on in the channelling we said: Once you feel loved, your world is perfect. Once love is flowing through your bodies, everything is in order. There is no love in war, there is no love in the Military. It’s just a low consciousness government. Government meaning control of the mind. This energy will also dissolve in the New World, and these men, this people, will have to find an honourable occupation. There is a place in the world for all those who have become conscious.

  

As you are with your eyes closed, just let the feelings come into your body; and once again, hand over any Military Energies that are in your bodies to Kryon. If you have Military energies inside your body you know how to relate to this; either on Earth, national or an individual basis. Here in Costa Rica there’s a beginning of a dissolving of the Military Energies, and this goes one person at a time. Your energy, the structure of your energy, will move from that of a the pentagon to that of a dodecahedron, as you release this Military Energy. It is like the story from Gulliver travels, where Gulliver is tied down by the little people; slowly but surely you cut through these small ropes, and as your consciousness flows, you begin to stand up in the world, proud and loving. So just observe your bodies and observe your feelings; many of you will fear releasing these energies for this has been your way of life. Allow these energies to release for there is another way, there is another way to live your life, there is a loving way to relate. Allow the fear of being without the military energies to also come into your body... let the feelings come and let the feelings go... 

What Military Energy means if we use an analogy: it would be like putting grinding paste into the oil of your motor car. Once you release these energies you will begin to feel lighter as you disconnect from this reality, and, you will find it easier and easier to release any other negative emotions. Military Energies are the core of all your problems. Allow the feelings in your body to come and let them go... imagine beneath you the beautiful planet, Mother Earth, and inside of Mother Earth there is a pink heart... allow all your family constellation to move into this pink heart... your mother, your father, your grandparents and great-grandfathers... brothers and sisters, aunts and uncles... nephews and nieces... cousins... let them all go into this pink energy... be cleansed and purified, and allow these Military energies to release and dissolve... heal all the hurt that the Military has caused to your family... let the feelings into your body... let them come and let them go... as these energies begin to dissolve the New World will begin to come to you. …”

Indonesia tank deal raises moral questions

Deutsche Welle, 5 November 2012

With Indonesia set to invest in a major tank deal with German suppliers, concerns over human rights abuses refuse to go away. There are also questions as to whether the archipelago nation needs such equipment.

The Indonesian foreign ministry has announced that the country's armed forces will buy 103 Leopard and 50 smaller Marder tanks from Germany. The orders were placed with the company Rheinmetall in Dusseldorf, Germany.

"The tanks will be delivered in stages - at the end of 2012, in 2013 and in the first half of 2014," Deputy Defense Minister Sjafrie Syamsuddin told journalists in Jakarta.

The deal is thought to be worth some 210 million euros (270 US dollars). The Indonesian Defense Ministry has said it will buy 40 Leopard 2A4 vehicles and 63 Leopard Revolution tanks.

A contract was due to be signed between Jakarta and Rheinmetall on Wednesday. The deal coincides with Rheinmetall's participation in an Indonesian military trade fair, the Indo Defense Expo and Forum, from November 7 to 12.

Syamsuddin made the announcement,
 saying the tanks would come in stages

Previously, the defense ministry had named the armaments company Krauss Maffei Wegmann in Munich as its supplier - something the firm had denied.

Despite those denials, the news was enough to trigger a storm of protest. Human rights organizations have sharply criticized the fact that the tanks are being procured from Germany. Valeska Ebeling of the rights group Survival International explained that her organization had strong concerns about the human rights situation in Indonesia - particularly in the region of West Papua. Survival International claims the indigenous people of the resource rich area have been suppressed since 1963.

"The German tanks could be used against by the government against its own people," said Ebeling. "We want Germany to address the issue of responsibility and human rights with Indonesia."

The opposition in Jakarta is also unhappy. Indonesian parliament representative and member of the defense commission, Helmi Fauzi, explained to DW that the Leopard tanks were not appropriate for Indonesia, being too heavy for the country's road system. In addition, he claimed, the Indonesian navy did not have ships suitable for carrying the tanks.

"Indonesia needs many more light and small tanks," explained Fauzi, who is a member of the largest opposition party the PDI-P. But while the defense commission initially saw a heated debate about the tank deal, Fauzi said, the majority were eventually in favor.

Rheinmetall is due to exhibit its wares
at a military trade fair in Indonesia

He said they were persuaded by the obsolescence of the army's existing equipment.

'A matter of status'

According to security experts, the Indonesian army was keen to buy heavy battle tanks because neighboring countries such as Malaysia and Singapore already possessed such weapons. For the army, the possession of such weapons was important, even if only for prestige.

The Indonesian human rights organization Imparsial criticized the project. Poengky Indarti, the group's executive director, described it as a pure waste of money adding that any deal should be based on objective rather than political criteria. Transparency, said Indarti, remained paramount to prevent corruption.

Dutch rejection, change of plan

The deal is also for a number of
light German "Marder" tanks

Originally, Indonesia had planned to buy used Leopard tanks from the Dutch army. However, the Dutch parliament rejected the deal earlier this year over concerns about human rights abuses. An Indonesian army spokesperson said that there were other possibilities - namely Germany.

Opponents of the weapons deal are now relying on the German government.

"Even if the weapons deal is not negotiated directly with the German government, but with a company instead, the government still needs to give its permission," stressed Survival International's Ebeling, hoping the government would carefully consider the situation of human rights in Indonesia.

S&P loses landmark Australian derivatives case

Channel News Asia, AFP, 05 November 2012       

                  

(AFP/File - Eric Piermont)

SYDNEY: Standard & Poor's lost a landmark case in Australia on Monday over top-flight ratings given to financial products that collapsed in the build-up to the 2008 global economic crisis.

The Federal Court of Australia ruled that S&P's AAA rating of constant proportion debt obligation notes created by banking giant ABN AMRO and sold to the councils of 13 Australian towns, had been "misleading and deceptive".

It is the first time a ratings agency has faced trial over synthetic derivatives and the case could set an important precedent for future litigation.

Within months of the councils buying the CPDOs from Australian firm Local Government Financial Services (LGFS) in late 2006, assured they had a less than one per cent chance of failing, the notes defaulted.

The councils lost AU$16 million (US$16.5 million) on the so-called "Rembrandt notes", more than 90 per cent of the capital invested.

Judge Jayne Jagot said S&P's assessment of the products as "extremely strong" had been central to the loss.

"S&P's rating of AAA of the Rembrandt 2006-2 and 2006-3 CPDO notes was misleading and deceptive and involved the publication of information or statements false in material particulars, and otherwise involved negligent misrepresentations to the class of potential investors in Australia," Jagot said.

Jagot said S&P had claimed to have reached its opinion "based on reasonable grounds and as the result of an exercise of reasonable care when neither was true and S&P also knew not to be true at the time made".

The judge ruled that ABN AMRO had also been "knowingly concerned in S&P's contraventions of the various statutory provisions proscribing such misleading and deceptive conduct" and had engaged in such conduct itself.

She made a similar ruling on LGFS and rejected the financial agencies' arguments that the councils should bear a part of the blame due to to their "contributory negligence".

Jagot ordered S&P, ABN AMRO and LGFS to each pay one-third of the small mostly mining and farming councils' losses plus interest.

The sale of risky investments such as mortgage-backed securities contributed to the worldwide financial meltdown in late 2008.

- AFP/xq

Former Goldman Sachs board member jailed for two years

BBC News, 24 October 2012

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A former Goldman Sachs board member who was found guilty of four criminal counts of insider trading has sentenced to two years in jail.

Rajat Gupta, 63, had leaked boardroom secrets to Raj Rajaratnam, a former hedge fund manager now serving 11 years in prison.

US District Court Judge Jed Rakoff also ordered Gupta to pay a $5m (£3m) fine.

Gupta said he regretted the impact of the case on his family and friends.

Reading from a statement, he said: "The last 18 months have been the most challenging period of my life since I lost my parents as a teenager."

He added: I've lost my reputation I built for a lifetime. The verdict was devastating."

During the court case, which resulted in Gupta being found guilty in June, the jury heard secret recordings of conversations between him and Rajaratnam.

The trial focused on a phone call made to Rajaratnam on 23 September 2008, minutes after Gupta had listened to a private conference call discussing a $5bn (£3.2bn) investment in Goldman Sachs by Warren Buffett's company Berkshire Hathaway. The deal was due to be made public after stock markets closed that day.

According to phone records, Rajaratnam bought $40m in Goldman Sachs stock moments after the phone call, earning nearly $1m.

Gupta, who was born in India and educated at Harvard, also served on the boards of Procter & Gamble, the Rockefeller Foundation and the Bill and Melinda Gates Foundation.

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Taxpayers Still Footing the Bill For Sidoarjo Mud

Jakarta Globe, Markus Junianto Sihaloho, October 24, 2012

A Sidoarjo Mudflow Mitigation Agency (BPLS) officer at the mudflow
in 2011. (AFP Photo)

               

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The 2013 State Budget passed by the House of Representatives on Tuesday suggests that the government will continue to give money to victims of the 2006 mudflow in Sidoarjo, East Java, despite claims that it was the responsibility of private company Lapindo Brantas.

It is uncertain what the final figure is but the government earlier proposed that Rp 2.26 trillion ($235 million) from state coffers be earmarked to the Sidoarjo Mudflow Mitigation Agency (BPLS), an ad hoc agency created to contain the mudflow and handle the victims relocation scheme.

Some of the funds, the government proposal says, will be used to purchase land and buildings outside the areas immediately affected by the mudflow, located in the villages of Besuki, Kedungcangkring and Pejarakan, and nine communities spread around the wards of Siring, Jatirejo and Mindi.

The funds will also be used to relocate residents in 65 community units spread across nine wards and villages, which the government says are all outside of the affected zones.

Money is also earmarked to “rescue the economic and social life” of the community around the impacted area while some funds are directed at efforts to further contain the flow of mud.

The government has already spent Rp 3.26 trillion on the BPLS and this year earmarked another Rp 1.6 trillion.

While refusing to acknowledge that the mudflow was a direct result of its gas drilling activities, Lapindo has agreed to compensate and acquire the land immediately impacted by the disaster.

But Public Works Minister Djoko Kirmanto said in June that Lapindo, a resources company owned by the family of businessman and presidential hopeful Aburizal Bakrie, has only paid Rp 2.9 trillion in compensation out of the Rp 3.8 trillion it was ordered to pay.

House of Representatives Deputy Speaker Anis Matta, who led the plenary session at which the House approved next year’s state budget, refused to comment on why the state is earmarking more money to the disaster.

“Try asking related House commission leaders,” he said.

Opinions are split on the cause of the incident. Many say it was caused by the drilling activities of Lapindo. But the company blamed an earthquake in Yogyakarta, hundreds of kilometers to the east.

On Aug. 15, the National Commission on Human Rights (Komnas HAM) made three recommendations linked to the mud volcano.

Komnas HAM recommended the company complete the purchase of land and buildings now covered by the mudflow; the police find out where responsibility for the incident lies; and the government assist victims through revised regulations.

The incident destroyed hundreds of homes, swamped 720 hectares of land and displaced thousands of people.

Delays in compensation payments have damaged public support for Aburizal, who on July 1 announced his bid for presidency under the Golkar Party banner.

Lalu Mara Satriawangsa, a Bakrie family spokesman, said the Bakries had set aside a large sum of money for compensation. There is speculation that Aburizal will wait until just before the 2014 election to pay, in an effort to boost his electoral prospects.

Golkar Party chairman Aburizal
Bakrie. (Reuters Photo/File)

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Indonesia's mud volcano flows on

Satellite picture received from Ikonos Satellite Image on May 29, 2008 shows

the mud volcano and its surrounding area in Sidoarjo, East Java. (AFP/Ikonos

Satellite Image)

More pictures ....

Indonesia's new financial service watchdog gets operation budget

English.news.cn,   2012-10-18

              

JAKARTA, Oct. 18 (Xinhua) -- Indonesia's newly-established financial services supervisory agency, OJK, said on Thursday that the parliament had approved an allocation of 1.69 trillion rupiah (about 175.1 million U.S. dollars) to finance its initial operation.

"So there has been approved at 1.69 trillion rupiah to finance our operation. Further details about the budget would be discussed in the following meetings," said OJK Chairman Muliaman Hadad.

Muliaman added that meetings to discuss about the budget would be resumed next month.

The allocation, he said, would be used to finance the system setting up works in the new agency and its initial operation.

The OJK would take over the central bank's jobs in supervising the operation of banks and financial services firms in the country.

In the future the central bank would particularly be assigned to control the country's fiscal and monetary policies.

Sworn in in July this year, the OJK board of directors is expected to commence work early next year.

Editor: Fang Yang

Muliaman D. Hadad, 52, the chief of the Financial Services
 Supervisory Authority (OJK), Indonesia's financial regulatory
body. (Antara Photo)

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Indonesia second-most fraud-prone country

The Jakarta Post/Asia News Network, Thursday, Oct 18, 2012

Indonesia, often cited as the fastest-growing market in Asia, remains chronically plagued by fraud according to a global survey that found that 65 percent of companies in the country have been affected by fraudulent practices in the past year.

The percentage is above the global average of 61 percent, throwing Indonesia, alongside China, the region's economic behemoth, into second place among countries where businesses are most impacted by fraud.

First place went to India, where 68 percent of companies surveyed admitted that they had been affected by fraud.

The study, conducted with more than 800 senior executives worldwide, was commissioned by Kroll Advisory Solutions with the Economist Intelligence Unit, and the findings published in Kroll's Annual Global Fraud Report.

"Our ground-level experience reveals that the major developing economies in the Asia-Pacific region are as corrupt and as fraud-prone as ever," said Tadashi Kageyama, Kroll Advisory Solutions's senior managing director for Asia.

The survey listed information theft as one of the most common forms of fraud in Indonesia, with 35 percent of respondents - the highest figure globally - claiming losses in this area.

"Fraud perpetrated against Indonesian companies also tends to originate from vendors; 27 percent of companies reported that a vendor played a leading role in fraud, compared to 17 percent worldwide," the Kroll report noted.

Information theft has also become the bane of companies worldwide, its prevalence declining slightly to 21 percent this year from 23 percent in the last survey. The US and Europe follow at Indonesia's heels in terms of information theft, with rates reaching 26 percent for both countries.

"Surprisingly, it is employees, rather than hackers, who are more to blame for the loss of information," the report mentioned.

Information technology (IT) analysts have previously pointed out that the growing trend of bring-your-own-device (BYOD), where employees utilize their personal devices such as smartphones and laptops for work, had unleashed issues concerning the security of company information.

Tom Hartley, Kroll Advisory Solutions president and CEO, said that companies, however, had taken action "in response to the myriad of external threats, leading to the overall decrease in the prevalence of fraud".

The study shows that globally, fraud concerns have eased. The number of respondents answering that they were moderately or highly vulnerable to information theft decreased to 30 percent from 50 percent, even though only 2 percent of companies reported having suffered from this type of fraud.

The findings, the report concludes, suggest that companies have grown overconfident regarding their vulnerability to fraud, which actually increases their risks.