Indonesia

1. Does Indonesia have legislation making it a criminal offence to engage in money laundering and/or terrorist financing?

Yes. Money laundering and terrorist financing are criminal offences in Indonesia under Law No. 8 of 2010 on Prevention and Eradication of Money Laundering Crime (“Law 8/2010”). Terrorist financing is more specifically legislated under Law No. 9 of 2013 on Prevention and Eradication of Terrorism Financing Crime.

2. To whom does the legislation apply?

The legislation applies to all individuals and/or corporations (a “Subject”). A corporation is defined as a collection of organised people and/or wealth, both in a form of legal entity or a non-legal entity.

3. What does the legislation prohibit?

Law 8/2010 prohibits every activity relating to the implementation of money laundering and its supporting actions, including the non-reporting of suspicious financial transactions.

4. How is money laundering defined? Does underlying criminal activity have to be proven?

Pursuant to Law 8/2010, money laundering is defined as:

• the act of hiding and disguising assets resulting from crime;
• the act of hiding and disguising transactions of assets resulting from crime;
• conspiracy in relation to hiding and disguising assets resulting from crime or transactions of assets resulting from crime;
• receiving, keeping, using or transferring assets resulting from crime; and
• hindering the investigation of a suspicion of money laundering.

The underlying criminal activity does not need to be proven first.

5. What level of intent or knowledge is required to establish a violation?

To establish the criminal offence of money laundering, Law 8/2010 uses both subjective and objective factors as follows:

• Subjective factor: The knowledge of the assets that should be known or suspected to be the proceeds of an underlying crime; and
• Objective factor: Transaction done by Subjects to hide or disguise assets that are known or suspected to be the proceeds of an underlying crime, as if those assets were obtained in a valid manner.

6. What are the potential penalties for infringing the legislation?

The penalties under Law 8/2010 are imprisonment and/or a fine. The length of imprisonment and the amount of penalty vary based on the criminal act and its perpetrator (individuals/corporation). The maximum penalty is Rp10,000,000,000 (ten billion Rupiah) and the maximum imprisonment is 20 years.

7. Does the legislation have extra-territorial reach?

Law 8/2010 does not explicitly mention any extra-territorial reach, however, the legislation applies to any underlying criminal activity and money laundering committed outside of Indonesia, as well as in respect of assets resulting from criminal activity outside of Indonesia.

8. Are there additional anti-money laundering or counter terrorist financing regulations or obligations, such as registration or reporting obligations, for businesses or individuals that operate in particular sectors or undertake particular activities?

Services Provider:

• A third party who provides financial or other goods and/or services (“Services Provider”) to its customer (“Customer”) has the obligation to report any suspicious financial transactions undertaken by the Customer, transaction in the amount of at least Rp500,000,000 (five hundred million Rupiah) or in foreign currency of equivalent value in one or several transactions in one business day, or financial transaction in the form of transfer of funds to and from foreign countries.
• The report referred to in the point above shall be submitted to Financial Transaction Reports and Analysis Centre (Pusat Pelaporan dan Analisis Transaksi Keuangan or “PPATK”) to be subsequently investigated by PPATK.
• Before or during the investigation process the Services Provider and any of its related individuals (e.g. BOD, BOC, or employees) may not disclose any information related to the Suspicious Financial Transaction to the Customer.
• In addition to the reporting and confidentiality obligations, the Service Provider shall implement the ‘Know Your Customer’ principle in a form of data registration, verification and supervision of the transactions of the Customer.
• The Supervisory and Regulatory Agency of a Service Provider shall report any suspicious financial transaction undertaken by a Customer that has not been reported by the Service Provider to the PPATK.

Any Individuals:

• Any individual has the obligation to report any suspicious amount of cash or any other payment instrument, starting from Rp100,000,000 (one hundred million Rupiah), brought into and outside of Indonesian custom area to the Directorate General of Customs and Excise (Direktorat Jenderal Bea dan Cukai or “DJBC”) which will subsequently be reported to the PPKAT by DJBC.

9. What are the potential penalties for failing to comply with these obligations?

A Services Provider would be imposed with an administrative sanction by its Supervisory and Regulatory Agency. In the event that such agency has not been established, the sanctions would be enforced by PPKAT in a form of warning, written warning, public announcement regarding the non-reporting/non-compliance or sanction, or administrative fine.

Any individual would incur an administrative fine in the amount of 10% of the total amount of the cash or payment instrument brought into and outside of the Indonesian custom area for a maximum penalty of Rp300,000,000 (three hundred million Rupiah).

10. Who are the relevant enforcement authorities in Indonesia and what are their contact details?

Relevant enforcement authority related to money laundering is PPATK with contact detail as follows:

Financial Transaction Reports and Analysis Centre (Pusat Pelaporan dan Analisis Transaksi Keuangan or PPATK)

address: Jalan Ir. Haji Juanda No. 35, Kebon Kelapa, Gambir, Central Jakarta, Indonesia

T: +62 211 952 8484; +62 215 092 8484

F: +62 213 856 809; +62 213 856 826

contact-us@ppatk.go.id

ppatk.go.id