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Acting Director of Litigation of the Ministry of Law and Human Rights, Imam Santoso, delivering Government\'s statement in the judicial review hearing of the Law on Prevention and Eradication of Money Laundering (TPPU Law), Monday (19/11) in the Plenary Courtroom of the Constitutional Court. Photo by Humas MK/Ganie.

Investigators of predicate offenses can investigate money laundering if there is sufficient preliminary evidence of money laundering when investigating a criminal offense according to its authority. This was stated by Acting Director of Litigation of the Ministry of Law and Human Rights, Imam Santoso, who represented the Government in a follow-up hearing of Law No. 8/2010 on the Prevention and Eradication of Money Laundering (TPPU Law) on Monday (19/11). 

Imam explained that Article 75 of the TPPU Law emphasized sufficient preliminary evidence, “In the event that the investigator find sufficient preliminary evidence on the presence of the criminal action of money laundering and the predicate offense, the investigator combines the criminal action of money laundering and the predicate offense and notifies the Center for Financial Transaction Reports and Analysis Center (INTRAC).”

"This is based on the Elucidation to Law Number 8 of 2010 that states that in its development, money laundering crimes are increasingly complex, crossing the boundaries of state jurisdictions, and using increasingly varied modes, utilizing institutions outside the financial system, and even expanding to various factors," explained Imam to the panel of justices led by Chief Justice of the Constitutional Court, Anwar Usman. 

Regarding the argument of the Petitioner that Articles 74 and 75 of the TPPU Law had led to non-optimal efforts to eradicate money laundering crimes, the Government explained that the modes of money laundering from time to time had been increasingly complex by using quite complicated technology and financial engineering. 

In simple terms, said Imam, money laundering can basically be grouped into various activity patterns, among others by way of placement, which is an effort to place funds generated from criminal activities into the financial system. Another method is layering, which is defined as separating the proceeds of crime from its source of related criminal activities through several stages of financial transactions. There is also integration, the attempt to establish a foundation as a legitimate explanation for the proceeds of a crime. 

"The proceeds of criminal acts through placement and layering are transferred to legitimate activities so that they did not appear to be related at all to the previous criminal activities that are the sources of money being laundered," Imam added. 

On the other hand, the Government was of the opinion that money laundering is a stand-alone crime. To process money laundering there is no need to wait for verdict for the predicate offense of assets known or reasonably suspected to have originated from criminal proceeds and those not originating from criminal proceeds. 

Meanwhile INTRAC\'s Director of Law Fithriadi Muslim asserted that the Elucidation to Article 74 of the TPPU Law have resulted in legal uncertainty for the community and stakeholders. In addition, the elucidation does not reflect effective legal efforts in countering money laundering. 

"In addition, the Elucidation to Article 74 of the TPPU Law does not fulfill the principle of an independent, simple, and fast judiciary and inhibits the implementation of the duties, functions and authorities of INTRAC," said Fithriadi on case No. 74/PUU-XVI/2018. 

Fithriadiexplained that Article 44 letter l of the a quo law reads, “In performing the function of analysis or examination of report and information as set forth in Article 40 letter d, INTRAC shall be authorized to forward the results of analysis or examination to the investigator.”

The Indonesian Anti-Money Laundering Institute (LAPI), Auriga Nusantara Foundation, Charles Simabura, Oce Madril, and Abdul Ficar Hadjar are Petitioners who had requested the judicial review of Article 2 paragraph (1) letter z and the Elucidation to Article 74 of the Prevention and Eradication of Money Laundering (PPTPPU Law). 

One article and one elucidation to Law No. 8, according to the Petitioners, contradict the 1945 Constitution for several reasons. First, the conflict arose because in Article 33 paragraph (4) of the 1945 Constitution, it is stated that the national economy is organized on the basis of economic democracy upholding the principles of togetherness, efficiency with fairness, sustainability, environmental insight, self-sufficiency, and by keeping balance in the progress and unity of national economy. 

The Petitioner claimed that actually money laundering based on the general elucidation to Law No. 8 is a criminal act that threatens the stability and integrity of the economic and financial systems. In this context, Article 2 paragraph (1) letter z and the elucidation to Article 74 cause the efforts to eradicate money laundering to not be optimal. (Nano Tresna Arfana/LA/Yuniar Widiastuti)

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