October 28, 2018 / 10:38 AM / 16 days ago

Indonesia arrests executives of palm firms in bribery probe

JAKARTA (Reuters) - Indonesia’s anti-graft agency has arrested seven people, including a senior executive of palm firm Sinar Mas Agro Resources and Technology, in connection with a bribery case, an official at the agency said on Sunday.

The Corruption Eradication Commission, known as KPK, named vice president director of Sinar Mas Agro, Edy Saputra Suradja, chief executive of PT Binasawit Abadi Pratama, Willy Agung Adipradhana, and some members of Central Kalimantan parliament as suspects in the case, KPK Deputy chief Saut Situmorang told Reuters.

Both Sinar Mas Agro and Binasawit are subsidiaries of Singapore-listed palm oil giant Golden Agri-Resources Ltd.

The people are accused of bribing parliamentarians to avoid an investigation into Binasawit’s plantation permits and palm processing waste near Sembuluh lake in the Borneo island, Situmorang said.

Golden Agri, in a statement following the arrest, said: “The company will cooperate fully with the ongoing investigation and hopes that the issues can be resolved as quickly as possible”.

It called the case “gravely concerning and regrettable” and stated that its Indonesian operations and subsidiaries must be managed in accordance to the law and regulations in the country.

A statement on behalf of both Sinar Mas Agro and Binasawit said all parties are fully cooperating with the investigation.

Reuters could not immediately reach Suradja, Adipradhana or their lawyers for comment.

Indonesia is the world’s top producer of palm oil. It has faced pressures from international buyers and environmentalists to make the industry more sustainable.

Central Kalimantan parliament had received complaints from residents that palm waste, allegedly from Binasawit’s plantation, had polluted Sembuluh lake, Situmorang said.

During a site visit to investigate the matter, parliament members found problems with Binasawit’s permit for use of forest areas, he said. He did not elaborate.

In the operation, KPK confiscated 240 million rupiah ($15,774) authorities suspect had been intended as bribe money, Situmorang said.

Reporting by Agustinus Beo Da Costa; Additional reporting by Cindy Silviana; Writing by Gayatri Suroyo; Editing by Christopher Cushing

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