Indonesia's Corruption Eradication Commission (KPK) has charged Emirsyah Satar, the former head of state airline, Garuda, with money laundering and ordered his detention for 20 days. Emir Satar has been caught up in the KPK's two year investigation, a spin-off of the SFO's major investigation into Rolls-Royce. The SFO and Singapore's Corrupt Practices Investigation Bureau have assisted the KPK with its investigation.
This development highlights two related investigative trends: regulators ramping up cross-border co-operation to tackle bribery and financial crime, which in turn normalises multi-jurisdictional investigations. It is noteworthy that cross-border information sharing between authorities is often informal and does not always follow time-consuming mutual legal assistance treaties.
A tangled web of investigations
Rolls-Royce's alleged bribery of Garuda Airlines and other Indonesian officials was included in the £671 million settlement the British company reached with the UK SFO, US DOJ and Brazil's Federal Prosecution Service in January 2017. More information on the SFO's Deferred Prosecution Agreement (DPA) can be found in our bulletin here. Insights on DPAs can be found in our recent podcast here.
Since 2017, Indonesia's anti-graft body, the KPK, has been questioning individuals at Garuda, including Emir Satar, who stands accused of accepting several illicit payments totalling 1.2 million euros (US$1.5 million), and other items worth $2 million. On 9 August, he was charged with money laundering and detained. Satar denies money laundering on the basis that the money and gifts were demonstrations of gratitude and not bribes. The KPK also believes that a Singaporean intermediary, Soetikno Soedarjo, is guilty of money laundering after providing Satar and another officials with benefits in exchange for highly lucrative contracts with Rolls-Royce, Airbus, ATR and Bombardier. It is likely that the KPK will take forward prosecution of Satar and related individuals.
To date, only the US has charged individuals in the Rolls-Royce investigation, whilst the SFO has focused on Rolls-Royce itself, agreeing its largest DPA to date with the company.
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