October 16, 2018 / 11:53 AM / a month ago

Indonesia arrests nine in bribery probe linked to $21 billion Lippo Group project

JAKARTA (Reuters) - Indonesia’s anti-corruption agency has arrested nine people, including a top district government official and a company director, in a bribery investigation linked to the Lippo Group’s $21 billion Meikarta real estate project near Jakarta.

A worker rides a bicycle in the Meikarta development in Cikarang, Bekasi, east of Jakarta, Indonesia, October 15, 2018 in this photo taken by Antara Foto. Antara Foto/Risky Andrianto/ via REUTERS

In a sting operation on Sunday, the Corruption Eradication Commission (KPK) arrested two Lippo Group consultants and an employee accused of trying to pay off city officials to obtain property permits for Meikarta, KPK chairman Laode Muhammad Syarif told a news conference late on Monday.

Costing $21 billion and billed as the “Shenzhen of Indonesia”, after the booming Chinese city, Meikarta is Lippo’s largest project to date and is meant to be a center for the automotive and electronic industries, while including five-star hotels, shopping malls and universities.

Shares in Lippo Group’s Lippo Cikarang, a parent company for Meikarta, dropped almost 15 percent after the news and ended down 13.36 percent on Tuesday.

Syarif told reporters that Lippo director Billy Sindoro was arrested and named as the prime suspect in the case after detained Lippo employees said they had been acting on his instructions to bribe a top district government official.

Syarif identified that official as Neneng Hasanah Yasin, who is the regent for West Java’s Bekasi area where the Meikarta project is located, saying he was also arrested.

Through the sting operation, investigators had confiscated 513 million rupiah ($33,772) and S$90,000 ($65,378) that had been intended as bribe money, Syarif said.

Neither Sindoro nor Yasin could immediately be reached for comment through their lawyers.

A lawyer for Meikarta said there was no tolerance for corruption and pledged to collaborate with KPK investigators. Meikarta would also conduct its own internal investigation.

“In the event we find that there was deviation from our anti-corruption principles, we will not hesitate to strictly sanction anyone found guilty according to employment law,” counsel Denny Indrayana said in Tuesday’s statement.

The anti-graft agency has given limited details of the others arrested in connection with the investigation but four of them are civil servants, the agency said.

The complexity of the Meikarta project, involving numerous government agencies in the issuance of its permits, made it more vulnerable to corruption and the KPK suspected there have been other instances of bribery, Syarif said.

Sindoro was convicted in 2009 for bribing an official at the anti-monopoly agency to obtain broadcasting rights for the English Premier League.

He was then president of First Media, another unit of the Lippo Group.

Reporting by Agustinus Beo Da Costa; Writing by Fanny Potkin; Editing by Ed Davies and Robert Birsel

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