In Indonesia most money laundering in the country is connected non-drug criminal activities

such as Corruption, Illegal Logging, Bank Fraud, Counterfeiting, etc. Indonesia also has a history of
law enforcement that is riddled with corruption. The proceeds of these money laundering activities
are sent to offshore accounts and only sent back to the country for personal or commercial needs.
Reporting on corruption submitted by Reporting on corruption submitted by the Financial Services
Providers are the Financial Services Providers are the dominant reports received by the dominant
reports received by INTRAC

In 2002, Indonesia established a Financial Intelligence Unit (FIU) called the Pusat Pelaporan
dan Analysis Transaksi Keuangan (PPATK), also known as the Indonesian Financial Transaction
Reports and Analysis Centre (INTRAC). The FIU was established by Law number 15 Year
2002 concerning the crime of Money Laundering. This has since been amended through Law of the
Republic of Indonesia Number 8 Year 2010.

Due to money laundering in Indonesia, an act called AML (Anti Money Laundering) is done
here in Indonesia. Practice guidance’s issued by public authorities regarding AML requirements over
the years:

1. Bank Indonesia Regulation No. 14/27/PBI/2012

2. Bank Indonesia Circular Letter No. 15/21/DPNP
3. Jasa Keuangan (Indonesian Financial Services Authority) No. 22/POJK.04/2014
4. PPATK (Centre for Financial Transaction Reporting and Analysis) No.
07/1.02/PPATK/12/10, Appendix 17

Links Between Corruption and Money Laundering Money Laundering

Corruption generates enormous Corruption generates enormous profits to be laundered; profits to

be laundered; „ Corruption facilitates ma Corruption facilitates many money laundering and ny
money laundering and terrorist financing methods and supports predicate terrorist financing
methods and supports predicate criminal activities; and criminal activities; and „ Systemic corruption
undermines the effectiveness of es the effectiveness of legislative, regulatory legislative, regulatory
and enforcement Anti and enforcement Anti-money laundering / combating the financing of
terrorism e financing of terrorism (AML/CFT) measures. (AML/CFT) measures.

Indonesia Efforts to Combat Corruption and Money Laundering

Indonesia has criminalized Indonesia has criminalized corruption under Law No. 31 corruption under
Law No. 31 of 1999 concerning the Eradicat of 1999 concerning the Eradication of Criminal Acts of
ion of Criminal Acts of Corruption, as amended Corruption, as amended by Law No. 20 of 2001. by
Law No. 20 of 2001. „ Indonesia has criminalized money laundering crime Indonesia has criminalized
money laundering crime under Law No.15 of 2002 concerning the Crime of ncerning the Crime of
Money Laundering, as amended by Law No.25 of 2003. ded by Law No.25 of 2003. „ Indonesia has
established the Corruption Eradication Indonesia has established the Corruption Eradication
Commission under Law No. 30 of 2002 „ Indonesia has ratified United Nations Convention Against
Nations Convention Against Corruption (UNCAC) by the Corruption (UNCAC) by the enactment of
Law No. 7 of enactment of Law No. 7 of 2006 concerning the Rati 2006 concerning the Ratification of
UNCAC

The existence of the application of regulation against money laundering in Indonesia is essentially a
transplant of international standards against money laundering that aims to prevent and eradicate
the crime. Indonesia and some other countries that join and become members of Financial Action
Task Force (FATF) have particularly applied transplants of international standards (legal transplants,
legal borrowing or legal adoption).