DRAFT OF LAW OF THE REPUBLIK OF INDONESIA NUMBER... YEAR CONCERNING THE PREVENTION AND ERADICATION OF THE CRIME MONEY LAUNDERING

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1 Draft Final DRAFT OF LAW OF THE REPUBLIK OF INDONESIA NUMBER... YEAR CONCERNING THE PREVENTION AND ERADICATION OF THE CRIME MONEY LAUNDERING WITH THE BLESSING OF THE ONE ALMIGHTY GOD THE PRESIDENT OF THE REPUBLIC OF INDONESIA Considering : a. that the crime of money laundering shall not only threaten stability and integrity of economic and financial systems but also may endanger principles of society, the State and the Nation based on Pancasila and the 1945 Constitution of the Republic of Indonesia; b. that the prevention and eradication of the crime of money laundering shall need sound legal basis and shall be able to guarantee the effectiveness of law enforcement, the proceeds of crime tracing and recovery, so that it will decrease the criminality; c. that Law Number 15 Year 2002 concerning the Crime of Money Laundering as amended by Law Number 25 Year 2003 needs to be adjusted with the development of requirements of law enforcement, international practice and standards, so that it is deemed necessary to replace it with new Law; d. that the considerations referred to in paragraphs a, b and c require the formulation of a Law concerning the Prevention and Eradication of the Crime of Money Laundering; In view of : Article 5 ayat (1) and Article 20 of the 1945 Constitution of the Republic of Indonesia; With the joint approval of THE PEOPLE S REPRESENTATIVE ASSEMBLY

2 OF THE REPUBLIC OF INDONESIA and THE PRESIDENT OF THE REPUBLIC OF INDONESIA HAS RESOLVED: To enact : LAW CONCERNING THE PREVENTION AND ERADICATION OF THE CRIME OF MONEY LAUNDERING. CHAPTER I GENERAL PROVISIONS Article 1 In this Law the following definitions apply: 1. Transactions shall be all activities creating rights and/or obligations or causing the creation of a relationship based on law between two or more parties. 2. Suspicious Financial Transactions shall be: a. transactions deviating from the profile, characteristics, or the usual transaction patterns of the customer concerned; b. transactions by users of services, that are reasonably suspected to be conducted for the purpose of avoiding reporting of the transactions required of Reporting Parties, in accordance with this Law; or c. transactions, whether or not completed, using assets that are reasonably suspected to constitute the proceeds of crime; or d. transactions requested by the Financial Transaction Reports and Analysis Center to be reported by reporting parties because related with the Assets suspected to be the proceeds of crime. 3. Cash Financial Transactions shall be transactions conducted using bank notes and/or coins. 4. Preliminary Investigation shall be a series of acts by a junior investigator to seek and to find an event that is presumed to be the crime of money laundering in order to determine whether or not an investigation may be carried out. 2

3 5. A Junior Investigator shall be an official who is granted authority by this Law to perform a preliminary investigation. 6. The Financial Transaction Reports and Analysis Center hereinafter referred to as the PPATK shall be an independent government institution established for the prevention and eradication of the crime of money laundering. 7. A person shall be any individual or corporation. 8. Corporation shall be organized groups of people and/or assets, whether or not incorporated as legal entities. 9. A Reporting Party shall be any person who is obliged to submit report to the PPATK under this Law. 10. A User of Services shall be a party who uses services of a reporting party. 11. Assets shall be all movable or immovable assets, both tangible and intangible. 12. Personnel of Corporation Controller shall be any person having a position as a policy maker of the corporation or having lawful authority to carry out such act without authorization from his/her superior. 13. A Conspiracy shall be an act by two or more persons who agree to commit the crime of money laundering 14. Documents shall be data, recordings or information that can be seen, read and/or heard, with or without the assistance of an instrumentality on paper or any physical material other than paper, or electronically, including and not limited to: a. writings, voice, or images; b. maps, designs, photographs, or the like; c. letters, signs, numbers, symbols, or perforations which have meaning or are understandable by those able to read or understand them. Article 2 (1) The proceeds of crime shall be Assets derived from the following criminal acts: a. corruption; b. bribery; c. narcotics; d. psychotropic substances; e. smuggling of workers; f. smuggling of immigrants; g. in the banking field; 3

4 h. in the capital market field; i. in the insurance field; j. in the excise field; k. in customs field; l. trade in people; m. illegal trade in arms; n. terrorism; o. kidnapping; p. theft; q. embezzlement; r. fraud; s. currency counterfeiting; t. gambling; u. prostitution; v. in the tax field; w. in the forestry field; x. in the environmental field; y. in the maritime field; or z. other offences for which the prescribed penalty is 4 years imprisonment or more; committed in the territory of The Republic of Indonesia, or outside the territory of The Republic of Indonesia and where the offence is considered a crime according to Indonesian law. (2) Criminal acts as referred to in paragraph (1) shall be the predicate crimes (3) Assets employed directly or indirectly for terrorist activities shall be deemed to be proceeds of crime referred to in Paragraph (1) sub-paragraph n. CHAPTER II THE CRIME OF MONEY LAUNDERING Article 3 Any person who moves, places, transfers, disburses, spends, donates, entrusts, takes out of the country, transforms, exchanges for currency or other negotiable instruments, or otherwise employs for Assets known or reasonably suspected to constitute the proceeds of crime as 4

5 referred to in Article 2 paragraph (1), with the purpose of concealing or disguising the origins of Assets, shall be punished for the crime of money laundering by imprisonment for a minimum of 5 (five) years and a maximum of 20 (twenty) years and a minimum fine of Rp.1,000,000, (one billion rupiah) and a maximum fine of Rp.20,000,000, (twenty billion rupiah) Article 4 Any person who conceals or disguises the origins, sources, location, allocation, transfer of factual rights or ownership of Assets known or reasonably suspected to constitute the proceeds of crime as referred to in Article 2 paragraph (1), shall be punished for the crime of money laundering by imprisonment for a minimum of 4 (four) years and a maximum of 15 (fifteen) years and a minimum fine of Rp. 500,000, (five hundred million rupiah) and a maximum fine of Rp.10,000,000, (ten billion rupiah). Article 5 (1) Any person who obtains, controls, possess or uses Assets known or reasonably suspected to constitute the proceeds of crime, shall be punished for the crime of money laundering by imprisonment for a minimum of 5 (five) years and a maximum of 20 (twenty) years and a minimum fine of Rp. 1,000,000, (one billion rupiah) and a maximum fine of Rp. 20,000,000, (twenty billion rupiah). (2) The provision as referred to in paragraph (1) shall not be applicable to a Reporting Party who performs the reporting obligation as refereed to in Article 21, Article 22 or Article 23. Article 6 (1) If the crime of money laundering referred to in Article 3, Article 4 and Article 5 is conducted by a Corporation, the punishment shall be imposed against a Corporation and/or Personnel of Corporation Controller. (2) A punishment shall be imposed against a Corporation if the crime of money laundering: a. is conducted or mandated by Personnel of Corporation Controller; b. is conducted in respect to meet purposes and intended nature of a Corporation; 5

6 c. is conducted in accordance with duties and functions of an executor or a person who gives orders; and d. is conducted with the purpose of providing advantages to a Corporation. Article 7 (1) A primary punishment imposed against a Corporation shall be a fine for a minimum of Rp. 1,000,000, (one billion rupiah) and a maximum of Rp. 100,000,000, (one hundred billion rupiah). (2) Besides a fine penalty as referred to in Article (1), a corporation may also be imposed by additional punishment in a form of: a. an announcement of the judge s decision; b. freezing businesses of a corporation both partly and entirely; c. a revocation of business licensing; d. a termination and prohibition of a Corporation; e. a corporation s assets forfeiture for the State; and/or f. taking over a Corporation by the State. Article 8 If the defendant is unable to pay a fine as referred to in Article 3, Article 4 and Article 5, said fine shall be replaced by light imprisonment for a maximum of 8 (eight) months. Article 9 (1) In the event that a corporation is unable to pay a main fine as referred to in Article 7 paragraph (1), said fine shall be replaced by a forfeiture against Assets of a corporation or the personnel of corporation controller that are equavalent with a fine imposed in a decision. (2) If an auction of forfeited Assets of a Corporation as referred to in paragraph (1) is insufficient, a light imprisonment substituting a fine shall be imposed against the Personnel of Corporation Controller by considering a fine has been paid. Article 10 Any Person inside or outside the territory of the Republic of Indonesia participating, attempting, assisting or conspiring in the commission of the crime of money laundering shall be subject to the same punishment referred to in Article 3, Article 4 and Article 5. 6

7 CHAPTER III OTHER CRIMINAL ACTS RELATED TO THE CRIME OF MONEY LAUNDERING Article 11 In the event that PPATK, investigators, public prosecutors, or judges who litigate cases of money laundering crime which are under investigation violate the provisions as referred to in Article 91 paragraph (1) and Article 93 paragraph (1), shall be imprisoned for a minimum of 5 (five) years and a maximum of 10 (ten) years. Article 12 (1) Any person shall be obliged to keep information/documents and/or other statement related with Suspicious Transaction Reports known or obtained by him/her secret. (2) Any person who violates the provisions of paragraph (1) shall be imprisoned for a minimum of 1 (one) year and a maximum of 3 (three) years. (3) The provisions as referred to in paragraph (1) shall not be applicable to PPATK, investigators, public prosecutors, and judges if it is carried out in order to meet obligations under prevailing Law or for the public interest. Article 13 (1) Directors, Board of Directors, management or employees of Reporting Parties shall not disclose to their users of financial services or other person, either directly or indirectly, by any manner, that it is contemplating making or has reported a Suspicious Financial Transaction to the PPATK. (2) The provision on prohibition as referred to in paragrah (1) shall not be subject to the referral of information to the supervisory agency and/or the regulatory agency of Reporting Parties. (3) The officials or employees of PPATK, and junior investigators/investigators shall not disclose to users of financial services in any manner, either directly or indirectly, Suspicious Transactions Reports submitted to the PPATK. (4) Violations of provisions as referred to in paragraph (1) and/or paragraph (3) shall be imprisoned for a minimum of 3 (three) years and a maximum of 5 (five) years and shall be fined a minimum of Rp. 100,000, (one hundred million rupiah) and a maximum of Rp. 1,000,000, (one billion rupiah) 7

8 Article 14 In the event that a convicted person is unable to pay a fine as referred to in Article 13 paragraph (4), said fine shall be replaced by light imprisonment for not more than 8 (eight) months. CHAPTER IV REPORTING AND COMPLIANCE SUPERVISION Part One Reporting Parties Article 15 (1) Reporting Parties shall include: a. Providers of Financial Services: 1) banks; 2) Financial Institiutions; 3) Insurance companies, reinsurance companies; and insurance/ reinsurance brokers companies; 4) Pension funds institutions; 5) Securities companies; 6) Mutual Fund Managers; 7) Custodians; 8) Trust Agents; 9) Depository and Settlement Agencies; 10) Post Offices acting as providers of current account services; 11) Foreign Exchange Traders; 12) Providers of credit cards and/or debit cards; 13) Providers of E-money and/or E-Wallet; 14) Saving and loan cooperatives; 15) Pawnshops; 16) companies dealing with comodities index 17) money remittance businesses b. Profession: 8

9 Advocates, notary, public accountant, liquidators, land Deed Registration Officials (Pejabat Pembuat Akta Tanah) and financial consultants when preparing or engaging transactions on behalf of their client. c. Other providers of goods and services: 1) property companies/agents, 2) car dealers, 3) jewelry traders, 4) arts and antiques traders, or 5) auctioneers, (2) The PPATK shall be authorized to determine other reporting parties as referred to in article (1). Part Two Know Your Customer Principles Article 16 (1) The supervisory agency and regulatory agency of Reporting Parties shall determine the provision concerning Know Your Customers principles. (2) Reporting parties shall be obliged to implement know your customer principles determined by each supervisory agency and regulatory agency of reporting parties referred to in paragraph (1). (3) The supervisor agency and regulatory agency of reporting parties shall be obliged to implement supervision over compliance of reporting parties in applying know your customer principles. (4) Know your customer principles shall at least include: a. Identification of customers; b. Monitoring transactions of customers; c. Capacity building; d. Internal control; and e. Internal and external audits conducted independently. (5) In the event that there is no supervisory agency or regulatory agency of Reporting parties, the provision on know your customer principles shall be determined by the Head of PPATK. 9

10 Article 17 (1) Any person engaging a transaction with the Reporting Party shall be obligated to provide accurate identity and information required by the Reporting Party at least on his/herself identity, sources of funds and purpose of transactions, by completing the forms provided by the Reporting Party and attaching its supporting documents. (2) In the event that a transaction engaged for another person, any person referred to in paragraph (1) shall be obliged to give information on identity, sources of fund and purpose of transactions of another person concerned. Article 18 (1) A Reporting Party shall be obliged to recognize a User of services engaging in a transaction with a Reporting Party, either acting on his/her own behalf or for and on behalf of other person. (2) In the event that a transaction with a Reporting Party is conducted for and on behalf of another person, a Reporting Party shall be obliged to request for information on identity and its supporting documents from a User of services and another person concerned. (3) In the event that the identity and/or supporting documents provided as referred to in paragraph (2) is incomplete, a Reporting Party shall be obliged to refuse a transaction of the person concerned. Article 19 (1) The identity and supporting documents required by a Reporting Party must be in accordance with prevailing laws and regulations determined by each supervisory agency and regulatory agency f Reporting Parties. (2) A Reporting Party must maintain records and documents on the identity of a person engaging in a transaction for 5 (five) years from the time the business relationship with the user of services concerned ends. Article 20 Reporting Parties referred to in Article 15 paragraph (1) sub-paragraph a, may postpone a transaction no later than 5 (five) business days or shall terminate a business relationship with the user of services that: 10

11 a. is suspected to use Assets or shall be an account to collect Assets derived from the crime; b. shall be used other than reasons of the opening of said account; or c. is known to employ false documents. Part Three Reporting Obligation Article 21 (1) Reporting Parties as referred to in Article 15 paragraph (1) sub-paragraph a shall be obligated to submit reports to the PPATK, in respect of the following matters: a. Suspicious Financial Transactions; b. Cash Financial Transactions to a cumulative total of Rp. 500,000, (five hundred million rupiah) or more, or an equivalent amount in another currency, made either in one transaction, or in several transactions within 1 (one) business day; c. Wire transfer from and to other countries. (2) The modification of total Cash Financial Transactions as referred to in paragraph (1) sub-paragraph b shall be stipulated in a Decree of the Head of the PPATK. (3) Total amount of wire transfer from and to other countries referred to in paragraph (1) sub-paragraph c, shall be stipulated in a Decree of the Head of the PPATK. (4) Transactions exempted as referred to in paragraph (1) sub-paragraph b shall include: a. transactions conducted between a provider of financial services and government and the Central Bank; b. transactions for payments of salaries or pension; and c. other transactions. (5) The Head of the PPATK shall be authorized to determine transactions exempted from reporting requirements as referred to in paragraph (4) sub-paragraph c. (6) Reports on Suspicious Financial Transactions referred to in paragraph 1 subparagraph b shall be submitted no later than 3 (three) business days after the Provider of Financial Services knows that there is an element of a Suspicious Financial Transaction. 11

12 (7) Reports on Cash Financial Transactions referred to in paragraph 1 sub-paragraph b shall be submitted immediately and no later than 14 (fourteen) business days as from the date on which the transaction concerned was conducted. (8) Reports on Wire Transfers from and to other countries referred to in paragraph 1 sub-paragraph c shall be submitted immediately and no later than 14 (fourteen) business days from the date on which the transaction concerned was conducted. (9) The reporting obligation referred to in paragraph 1 sub-paragraph b shall not be applicable to exempt transactions. (10) Reporting parties shall be obligated to prepare and maintain a list of exempt transactions referred to in paragraph (3). (11) Provisions concerning the form, type and procedure for submitting reports referred to in paragraph (1) shall be further stipulated in a Regulation of the Head of the PPATK. (12) Reporting Parties who shall not submit reports to the PPATK as referred to in paragraph (1), shall be subject to administrative sanctions. Article 22 (1) Reporting parties as referred to in Article 15 paragraph (1) sub-paragraph b shall be obliged to submit transaction reports conducted for and/or on behalf of their clients in total amount of Rp. 500,000, (five hundred million rupiah) or more or an equivalent amount in another currency to the PPATK. (2) If Reporting Parties as referred to in Article 15 paragraph (1) sub-paragraph b found a suspicious financial transaction in implementing their work as referred to in Article 1 point 2, they are obliged to submit said suspicious transaction report to the PPATK. (3) Transaction reports as referred to in paragraph (1) and paragraph (2) shall be submitted immediately and no later than 14 (fourteen) business days from the date on which the transaction concerned was conducted. (4) Reporting Parties who do not submit reports to the PPATK as referred to in paragraph (1) and paragraph (2), shall be subject to administrative sanctions. Article 23 (1) Reporting Parties as referred to in Article 15 paragraph (1) sub-paragraph c shall be obligated to submit transaction reports conducted by the User of services with total 12

13 amount of Rp. 500,000, (five hundred million rupiah) or more or an equivalent amount in another currency to the PPATK. (2) Transaction reports as referred to in paragraph (1) shall be submitted immediately and no later than 14 (fourteen) business days from the date on which the transaction concerned was conducted. (3) Reporting Parties who intentionally do not submit reports to the PPATK as referred to in paragraph (1) shall be subject to administrative sanctions. Article 24 A reporting party as referred to in Article 15 paragraph (1) who does not provide information required in respect to a compliance audit against reporting obligation under this Law, shall be subject to administrative sanctions. Article 25 (1) Administrative sanctions as referred to in Article 21, Article 22, Article 23 and Article 24 may be: a. a caution; b. a written warning; c. an announcement to public on actions or sanctions imposed by the PPATK; d. administrative fine; e. a recommendation on business activity restriction to the authroized agency; and/or f. a recommendation on revocation of a business lisence to the authorized agency. (2) The result of acceptance of administrative fine as referred to in Article 21, Article 22, Article 23 and Article 24 shall be posted as Non-Tax State Revenue based on prevailing laws and regulation. (3) Provisions on procedure for sentencing administrative sanctions shall be further governed in a Regulation of the Head of PPATK. Article 26 The implementation of reporting obligations by Reporting Parties shall be exempted from secrecy provisions subject to reporting parties concerned. 13

14 Article 27 No civil or criminal action can be brought against Reporting Parties, their officials and their employees for carrying out of reporting obligations referred to in Article 21, Article 22, or Article 23. Part Four Compliance Supervision Article 28 Compliance Supervision over Reporting Parties on reporting obligation shall be conducted by the PPATK. Article 29 In the event that a supervisory agency and a regulatory agency of Reporting Parties found a financial transaction that is satisfying criteria of a suspicious financial transaction and is not reported by a Reporting Party to the PPATK then a supervisory agency and/or regulatory agency of Reporting Parties shall submit said findings to the PPATK.. Article 30 Agencies that have authorities under the law to perform supervision or regulatory against any party who is subject to reporting obligation shall immediately inform the PPATK any activity or transaction of a Reporting Party known or reasonably suspected by him/her is engaged both directly and indirectly for the purpose of money laundering. CHAPTER V CASH CARRYING INTO AND OUT OF CUSTOMS TERRITORY OF INDONESIA Article 31 (1) Any person taking cash into or out of the customs territory of Indonesia in Rupiah and/or other currency equivalent with the amount of Rp. 100,000, (one hundred million rupiah) or more must inform to the Directorate General of Customs and Excise. (2) The Directorate General of Customs and Excise must prepare a report on cash carrying in accordance with paragraph (1) and shall report it to the PPATK no later than 5 (five) business days as from information was obtained. 14

15 (3) The PPATK may request for additional information from the Directorate General of Customs and Excise regarding cash carrying as referred to in paragraph (1). Article 32 (1) Any person who is not declaring a cash carrying report as referred to in Articlce 31 paragraph (1) shall be subject to administrative sanction of fine in the amount of 10% (ten percent) of total cash carried, maximum of Rp. 300,000, (three hundred million rupiah). (2) Any person who has made a declaration on cash carrying as referred to in Article 31 paragraph (1) but total cash carried is more than total amount reported, shall be subject to administrative sanction of fine in the amount of 10% (ten percent) of the difference of total cash carried, maximum of Rp. 300,000, (three hundred million rupiah). (3) An administrative sanction as referred to in paragraph (1) and paragraph (2) shall be taken directly from cash carried and shall be deposited to an account of the State Treasury by the Directorate General of Customs and Excise. (4) the Directorate General of Customs and Excise shall be obliged to prepare a report on administrative saction as referred to in paragraph (2) and shall send it to the PPATK wihin no later than 5 (five) working days as from an administrative was imposed. Article 33 Further provisions on the procedures for declaring cash carrying into and out of customs territory of Indonesia, sentencing administrative sanctions, and depositing to the state treasury as referred to in Article 31 and Article 32 shall be governed in the Ministerial Decree of the Minister of Finance. CHAPTER VI THE FINANCIAL TRANSACTION REPORTS AND ANALYSIS CENTER Part One Position Article 34 In implementing this Law, the PPATK shall be established. 15

16 Article 35 (1) The PPATK shall be an institution that is independent and free from any intervention and influence of any party whatsoever in implementing its duties and authorities. (2) The PPATK shall be responsible to the President (3) Any party shall be prohibited to conduct any intervention whatsoever against the implementation of duties and authorities of the PPATK. Article 36 (1) The PPATK shall be domiciled in the Capital City of the State of the Republic of Indonesia. (2) As necessary, the PPATK may open regional representative offices. Part Two Functions, Duties and Authorities Article 37 The PPATK shall have function to implement prevention and eradication measures of the crime of money laundering. Article 38 In implementing its function as referred to in Article 37, the PPATK shall have the following duties : a. to perform the prevention measures of the crime of money laundering; b. to manage data and information obtained by the PPATK; c. to conduct supervision over compliance of Reporting Parties d. to conduct analysis on reports and information and to submit the results of analysis on financial transactions which have indications of the crime of money laundering and or other crimes to investigators; and e. to conduct a preliminary investigation on the crime of money laundering. Article 39 In performing its duty in the prevention and eradication of the crime of money laundering referred to in Article 38 sub-paragraph a, the PPATK shall be authorized: 16

17 a. to coordinate the prevention measures of the crime of money laundering with relevant institutions; b. to provide recommendations to the Government concerning the prevention measures the crime of money laundering; c. to represent the Government of the Republic of Indonesia in international organizations and forums in relation to the prevention and eradication of the crime of money laundering; d. to organize training and education programs on anti-money laundering; and e. to conduct a socialization on the prevention and eradication of the crime of money laundering. Article 40 In performing its duty to manage data and information as referred to in Article 38 subparagraph b, the PPATK shall be authorized to implement the information system. Article 41 In performing its duty of supervision over compliance of Reporting Parties, as referred to in Article 38 sub-paragraph c, the PPATK shall be authorized: a. to determine provisions and guidelines on reporting procedures for reporting parties; b. to determine category of Users of services potentially to conduct the crime of money laundering; c. to conduct compliance audit over reporting parties; d. to submit information from the results of audits to agencies authorized to supervise reporting parties; e. to provide warnings to Reporting Parties that violate the reporting requirement; f. to recommend to the authorized institutions to revoke a business lisence of a Reporting Party; and g. to issue implementing provisions on know your customer principles for reporting parties that have no supervisory and regulatory agencies. Article 42 In performing its duty to analyze reports and information as referred to in Article 38 subparagraph d, the PPATK shall be authorized: a. to request for and obtain reports and information from Reporting Parties; b. to request for information to relevant institutions or other parties; 17

18 c. to request for information from Reporting Parties based on the progress of the results of analysis of the PPATK; d. to request for information from Reporting Parties based on a request from law enforcement agencies or international counterparts; e. to deliver information and/or the result of analysis to the requesting institution, both domestic and international; and f. to order reporting parties to suspend transactions. Article 43 In performing its duty of preliminary investigation on the crime of money laundering, as referred to in Article 38 sub-paragraph e, the PPATK shall be authorized: a. to obtain reports and/or information from public on any suspicion of the crime of money laundering; b. to request for information from Reporting Parties and other parties relation with a suspicion of the crime of money laundering; c. to look for information and physical evidence; d. to conduct a tape recording on communcations performed in order to conduct an analysis on financial transactions obtained from media; e. to stop temporarily the whole or part of transaction activities on Assets known or suspected to constitute the proceeds of crime; f. to stop transactions temporarily on the burden of an account known or suspected to collect the proceeds of the crime of money laundering; g. to freeze Assets suspected to constitute the proceeds of crime; h. to request for information on the progress of investigation conducted by investigators who investigate the predicate crime; i. to notify the result of preliminary investigation to an invesgitaor; and j. to perform other actions under the law. Article 44 In the event that in implementing its authority as stipulated in this Law, the PPATK shall not be subject to the provisions of laws and code of ethics pertaining the secrecy. Article 45 18

19 In the event there are new international conventions or recommendations in the prevention and eradication of the crime of money laundering, the PPATK may issue its implementing regulation based on this Law. Article 46 The provisions on the procedure for implementing authorities of the PPATK shall be further governed in a Regulation of the Head of PPATK. Part Three Organizational Structure Article 47 Organizational Sturcture of the PPATK shall consist of: a. Head; b. Vice Head; c. Deputies; d. Other structural position; and e. Functional position. Article 48 The Head and Vice Head of the PPATK as referred to in Article 47 sub-paragraphs a and b shall be a Government Official. Article 49 (1) The Head as referred to in Article 47 sub-paragraph a, shall represent the PPATK either inside or outside the Court. (2) The Head of PPATK may mandate the authority to represent as referred to in paragraph (1) to the Vice Head of the PPATK and/or any or some Deputies, and/or any or some employees of PPATK and/or other party specially appointed for that purpose. Article 50 19

20 The Head of the PPATK shall be responsible to lead and control the implementation of duties and authorities of the PPATK. Article 51 In order to be appointed as the Head and the Vice Head of the PPATK, a candidate must meet the following requirements: a. be an Indonesian Citizen; b. be not less than 35 (thirty-five) years of age and not more than 60 (sixty) years of age at the time of appointment; c. be mentally and physically healthy; d. be devout, honest, just and have good personal integrity; e. possess expertise and experience in fields of economy, finance or law at minimum 10 years; f. shall not be a manager in a political party; g. shall announce his/her properties based on prevailing laws and regulations; h. shall not hold other positions or employments concurrently; and i. never have been sentenced to a term of criminal imprisonment. Article 52 (1) The Vice Head of the PPATK shall have a duty to provide assistance to the Head of the PPATK in coordinating activities of entire deputies. (2) The Vice Head of the PPATK, as referred to in paragraph (1), shall be responsible to the Head of PPATK. (3) In the event that the Head of the PPATK is not available, the Vice Head of the PPATK shall carry out duties as the Head of the PPATK. Article 53 (1) The Head and the Vice Head of the PPATK as referred to in Article 47 sub-paragraphs a and b shall be appointed and dismissed by the President of the Republic of Indonesia. (2) The Head and the Vice Head of the PPATK as referred to in Article 47 sub-paragraphs a and b shall be appointed by the President based on a recommendation of the Minister of Finance and Governor of Bank Indonesia. Article 54 20

21 (1) The Head and the Vice Head of the PPATK, prior to assuming his/her position, shall be obligated to swear an oath, or make an affirmation, according to their religion or belief, before the President. (2) The oath or affirmation referred to in paragraph (1) and paragraph (2) shall be as follows: "I swear/affirm that, in order to become the Head/Deputy of the PPATK, I have neither directly or indirectly given or promised anything to anyone in any name or for any pretext whatsoever." "I swear/affirm that, in performing or not performing any action in this position, I shall not receive, either directly or indirectly, any promise or gift from anyone in any form whatsoever." "I swear/affirm that I will keep secret, from any party, matters that must be kept secret in accordance with prevailing laws and regulations". "I swear/affirm that I shall perform the duties and authorities as the Head/Deputy to the best of my abilities and with full responsibility." "I swear/affirm that I shall be loyal to the state, the Constitution, and prevailing laws and regulations. Article 55 The term of office of the Head and the Vice Head of the PPATK shall be 4 (four) years and shall be eligible for re-election for only one subsequent term of office. Article 56 The Head or the Vice Head of the PPATK shall be quit for the following reasons: a. death; b. resignation; or c. expiration of the term of office. Article 57 (1) The Head and the Vice Head of the PPATK shall be dismissed for the following reasons: a. residing outside the territory of the state of the Republic of Indonesia; b. losing citizenship as a citizen of the Republic of Indonesia; 21

22 c. suffering from a continuous illness, recovery from which requires more than 3 (three) months, so that he/she is unable to perform their duties; d. becoming a defendant in a criminal case subject to imprisonment of 4 (four) years or more; e. being sentenced to imprisonment; f. holding other positions or employment concurrently; g. being declared bankrupt by a court; or, h. violating the oath/affirmation of office. (2) In the event that the Head and/or the Vice Head of the PPATK becomes a defendant in a criminal case in relation to misconduct of their position, they shall be dismissed temporarily from their position. (3) A dismissal as referred to in paragraph (1) and paragraph (2), shall be determined by the President of the Republic of Indonesia. Article 58 The provisions regarding the salary system, bonuses, allowances, pensions, income and facility for the Head and Vice Head of the PPATK shall be governed in a Presidential Regulation. Article 59 The Head of the PPATK may appoint to provide advices regarding certain matters based on their expertise if required. Article 60 (1) Deputies as referred to in Article 47 sub-paragraph c shall be appointed and dismissed by the President based on a recommendation of the Head of the PPATK. (2) Deputies as referred to in paragraph (1) shall implement functions of the prevention of the crime of money laundering, data and information management, compliance supervision, research and analysis, preliminary investigation and internal management. Article 61 Provisions on organizational structure and working procedures of the PPATK shall be further governed in the Presidential Regulation. 22

23 Part Four Human Resources Management Article 62 The Head of the PPATK shall be an employment advisor within the PPATK. Article 63 (1) The Head of the PPATK as an employment advisor shall organize human resources management of PPATK that consists of planning, procurement, capacity building, dismissal, and remuneration facility. (2) Human resources management of the PPATK as referred to in paragraph (1) shall be prepared and implemented based on the merit system. (3) The provisions on human resources management of the PPATK as referred to in paragraph (2) shall be governed in a Government Regulation. Part Five Finance Article 64 Expenditures for implementing duties of the PPATK shall come from the State Budget. CHAPTER VI ASSETS RECOVERY Article 65 (1) The PPATK may freeze Assets based on the authority under Article 43 sub-paragraph g. (2) The freezing as referred to in paragraph (1) shall be performed if the PPATK finds out that said Assets may not be explained by the owner or the controlling party, has no clarity on its owner or are obtained illegally. (3) The freezing as referred to in paragraph (2) shall be conducted within no later than 90 (ninty) days. (4) During freezing as referred to in paragraph (3), the PPATK shall announce said Asset at minimum in an official annoucement for public or electonic media (internet) in 23

24 order to provide an appportunity to the party entitled to or the third party who has good faith to file an objection. (5) An annoucement as referred to in paragraph (4) shall be conducted 3 (three) times within 15 (fifteen) days. Article 66 (1) In the event that there is a party entitiled to or the third party filing an objection to the PPATK on Assets frozen, it shall be conducted by attaching documents or supporting evidence. (2) The PPATK shall be obliged to examine and assess the accuracy of documents or supporting evidence as referred to in paragraph (1). Article 67 (1) If the result of examination and assessment as referred to in Article 66 paragraph (2) shows that documents and supporting evidence are considered accurate, the PPATK shall be obliged to revoke a decision on freezing. (2) If the result of examination and assessment as referred to in Article 66 paragraph (2) shows that documents and supporting evidence are considered inaccurate, the PPATK shall be obliged to proceed a decision on freezing. Article 68 (1) If the PPATK shall consider to proceed a decision on termination as referred to in Article 67 paragraph (2), then a party entitled to or the third pary may file a defense. (2) A defense as referred to in paragrahp (1) shall be proposed by a party entitled and/or the third party to the District Court within no later than 14 (forteen) days as from an announcement was ended. (3) The examination shall be conducted thru a civil action by requiring the party filing a defense to prove that said Assets are his/hers or possessed legally and not derived from the crime. (4) The examination process of a defense as referred to in paragraph (3) shall be conducted immediately and within no later than 30 (thirty) day Judges must have issued a judgment. Article 69 24

25 (1) In the event that Judges consider that said Assets shall be possessed by or legitimately controlled by the party who files a defense and are not related with the crime, the Judges shall issue a judgment to revoke a freezing and shall order the PPATK to send back Assets to the party entitled. (2) In the event that Judges consider that the party who files a defense may not prove said Assets are his/hers and legitimately possessed by the party concerned and are not related with the crime, the Judges shall issue a judgment that said Assets shall be forfeited by the State. (3) A judgment as referred to in paragraphs (1) and (2) shall be final. Article 70 In the event that there is no party entitled and/or the third party filing an objection, the PPATK shall request to the District Court to stipulate that said Assets shall be the State Assets. CHAPTER VIII PRELIMINARY INVESTIGATION, INVESTIGATION, PROSECUTION AND EXAMINATION BEFORE THE COURTS Part One General Article 71 The preliminary investigation, investigation, prosecution and examination before the court and the execution of a judgment that has final legal binding of the crime referred to in this Law will be based on the provisions set forth in the Criminal Procedure Law (KUHAP), unless stipulated otherwise herein. Article 72 (1) An investigator, public prosecutor or Judge shall be authorized to order Reporting Parties to freeze and/or postpone a transaction of Assets known or reasonably suspected to constitute the proceeds of crime from: a. Any person who has been reported by the PPATK to investigators; b. The suspect; or c. The defendant. 25

26 (2) The orders of an investigator, prosecutor, or Judge referred to in paragraph (1) must be implemented in writing clearly indicating the following: a. name and position of the investigator, prosecutor, or Judge; b. the identity of any person reported by the PPATK to the investigator, the suspect or the defendant; c. reasons for freezing and or postponing a transaction; d. the crime which is alleged or being prosecuted; and e. the location of Assets (3) Transaction freezing and/or postpone referred to in paragraph (1), shall be carried out within no later than 14 (fourteen) business days. (4) On receipt of the order of the investigator, public prosecutor or judge referred to in paragraph (1), a Reporting Party shall obliged to freeze and or postpone a transaction immediately as from said order was obtained. (5) Reporting Parties shall be obliged to submit a memorandum concerning the freezing and or postponing of transactions to the investigator, public prosecutor, or Judge no later than 1 (one) business day from the date of the carrying out of the freezing. (6) Frozen Assets must remain with the Reporting Parties concerned. Article 73 Legal evidence for purposes of the crime of money laundering shall be as follows: a. legal evidence under the Criminal Procedure Law (KUHAP); b. other legal evidence in the form of information uttered, sent, received, or saved in electronic form using optical devices or the like; and documents referred to in Article 1 paragraph 14. Article 74 To be able to perform investigation, prosecution and examination in the court of justice on the crime of money laundering, there is no need to first prove its predicate crime. Article 75 (1) In cases of money laundering, investigators, public prosecutors, of Judges shall be authorized to request information from Reporting Parties regarding Asset of: a. any person reported by PPATK to investigators; 26

27 b. the suspect; or c. the defendant (2) When they are requesting information referred to in paragraph (1), the provisions of laws stipulating bank secrecy and the secrecy of other financial transactions shall not be applicable to investigators, public prosecutors or judges. (3) Requests for information shall be submitted in writing clearly indicating the following: a. name and position of the investigator, public prosecutor or judge concerned; b. the identity of the person reported by the PPATK to the investigator, the suspect or defendant; c. the crime which is alleged or being prosecuted; and d. the location of Assets (4) The letter requesting information referred to in paragraph (1) and paragraph (2) shall be signed by: a. the Chief of the Indonesian National Police or a Regional Chief of Police in the event that the request is made by an investigator; b. the Director of an institution in the event that a request is proposed by investigators who are not investigators of Polri; c. the Attorney General or the Head of a Provincial Prosecutor's Office in the event that the request is made by a public prosecutor; d. the Head of the Panel of Judges hearing the case concerned. (5) A request referred to in paragraph (4) shall be sent to the PPATK for its copy carbon. Part Two Preliminary Investigation Article 76 (1) Junior investigators shall include: a. junior investigators of the PPATK appointed and dismissed by the Head of the PPATK; and b. the junior investigators of the predicate crime. (2) Junior investigators referred to in paragraph (1) shall perform a preliminary investigation function of money laundering crime stipulated in this Law. 27

28 Article 77 (1) When junior investigators referred to in Article 76 paragraph (1) sub-paragraph a found sufficient preliminary evidence in performing preliminary investigation, junior investigators shall submit a report to the Head of the PPATK no later than 7 (seven) business days from the date of said sufficient preliminary evidence was found. (2) The Head of the PPATK shall submit the result of preliminary investigation referred to in paragraph (1) to the investigators of the predicate crime to be investigated. (3) The investigators of the predicate crime referred to in paragraph (1) shall be obliged to perform investigation and coordination with the PPATK. Article 78 (1) Temporary freezing or blocking of mutation of Assets referred to in Article 43 subparagraphs f and g shall be carried out as from a Suspicious Financial Transaction Report was obtained from a Reporting Party. (2) The temporary freezing or blocking of mutation of Assets referred to in paragraph (2) shall be carried out no later than 14 (forteen) business days as from a Suspicious Financial Transaction Report was obtained. Part Three Penyidikan Article 79 The investigation of the crime of money laundering shall be performed by investigators of the predicate crime based on the provisions set forth in the Criminal Procedure Law (KUHAP), unless stipulated otherwise herein. Article 80 In the event that investigators conducting an investigation of the predicate crime found an indication of the crime of money laundering, investigators shall accumulate said investigation of the crime of money laundering and shall inform to the PPATK. Article 81 28

29 For the purpose of investigation, a suspect of the crime of money laundering shall be authorized to provide information to the investigators regarding his/her entire wealth and the wealth of his/her spouse, children and any person or corporation known and/or suspected to have relation with the crime of money laundering suspected to him/her. Article 82 (1) In order to enhance efficiency and effectiveness in investigating the crime of money laundering, the PPATK may recommend to the investigators of the predicate crime to establish a task force participated by the PPATK, investigators, and public prosecutors. (2) The establishment of a task force referred to in paragraph (1), shall be determined in a Decree of the head of the institution of investigators of the predicate crime. Part Four Prosecution Article 83 (1) The public prosecutors shall be obliged to submit the dossier of the money laundering case to the District Court no later than 30 (thirty) business days from the date said dossier of the case that has been declared complete was obtained. (1) In the event that Public Prosecutors have submitted the dossier of the case to the District Court referred to in paragraph (1), the Chairman of the District Court shall be authorized to establish the Panel of Judges no later than 3 (three) business days from the date said dossier of the case was obtained. Part Five Examination before the Court Article 84 In court proceedings, the defendant shall have the burden of proving that their Assets are not the proceeds of crime. Article 85 For the purpose of the court proceedings referred to in Article 84, then: 29

30 a. the Judges shall order that the defendants shall have the burden of proving that their Assets related with this case are not the proceeds of crime referred to in Article 2; b. The defendants shall have the burden of proving on Assets referred to in subparagraph a by presenting sufficient legal evidence. Article 86 (1) In the event that the defendant has been duly and reasonably summoned does not appear in court without any lawful reason, a case may be examined and passed judgment in the absence of the defendant. (2) In the event that the defendant attends a subsequent hearing prior to the verdict being rendered, the defendant must be examined and all witness statements and documents read out in previous sessions shall be considered to be read out in current sessions. (3) Judgment rendered in a defendant s absence shall be announced by the public prosecutor on the announcement board of the court, the office of Regional Government, or shall be announced to his/her proxy. (4) In the event that the defendant dies prior to the rendition of judgment and there is sufficient evidence that the defendant committed the crime of money laundering, the Judges based on an indictment prepared by the public prosecutor shall determine a decision on forfeiture of seized Assets. (5) A decision on forfeiture referred to in paragraph (5) may not be requested for an appeal. (6) Any person having an interest may request for a claim to the court that has rendered a decision referred to in paragraph (5) no later than 30 (thirty) days from the date of an announcement referred to in paragraph (3). Article 87 (1) In the event that the Judges shall decide referred to in Article 86 paragraph (3), the inabsentia convicted person may request for an appeal. (2) A period of time to request for an appeal referred to in paragraph (1) shall be conducted within no later than 7 (seven) days as from the third announcement was published. Article 88 30

31 In the event that sufficient evidence is obtained that there are still Assets which have not already been confiscated, the Judge shall order the public prosecutor to conduct the confiscation of said Assets. Article 89 In the event that the crime is committed by a corporation, the summons shall be delivered to the managers at their residences or office. Article 90 (1) In the event that the Judges shall decide that Assets is forfeited for the state, and said judgment has become final and binding, 25% (twenty five percentages) of total Assets shall be given to the law enforcement institution and other relevant institution. (2) Further provisions on Assets sharing referred to in paragraph (1) shall be stipulated in a Presidential Regulation. CHAPTER VIII PROTECTION FOR REPORTING PARTIES AND WITNESSES Article 91 (1) The PPATK, investigators, public prosecutors and judges shall keep the identity of a reporting party secret. (2) Violation of the provision of paragraph (1) shall entitle the reporting party concerned or their heirs to claim damages through the courts.. Article 92 (1) Any person reporting a suspicion that the crime of money laundering may have occurred shall be provided with special protection by the state against possible threats endangering the person, their life, their family and/or their assets. (2) The procedure for providing special protection referred to in paragraph (1) shall be further stipulated by Government Regulation. Article 93 31