The row has raised questions over Indonesia's commitment to fighting chronic corruption and provoked a public outcry at the hardball tactics of the police, which is going toe-to-toe with the anticorruption agency.
Protesters in Jakarta rallied for the second day Tuesday over the arrest last week of two senior officials of the elite agency, known as the KPK, which has successfully prosecuted government officials and politicians for graft. The two men are accused by police of abusing their power during an investigation into a collapsed bank, and both deny the accusations. They were released Tuesday but still face charges.
Protesters say the case is spurious and motivated by revenge, part of an ongoing pushback against the KPK by police, politicians, and prosecutors. In September, the outgoing parliament passed a law to dilute the power of ad hoc judges – who are seen as cleaner than career judges – to try anticorruption cases brought by the KPK.
Graft busters have fought back: KPK wiretaps leaked to Indonesian media appear to show that the police officials and prosecutors plotted to entrap the two commissioners, Chandra Hamzah and Bibit Rianto.
Scandal taints president's clean image
The wiretaps have inflamed public opinion and caught Yudhoyono on the back foot after he insisted that the legal process must run its course.
Amid a storm of criticism, including a Facebook protest that attracted more than 300,000 users, President Yudhoyono switched course Monday and named a fact-finding committee to look into the wiretap revelations. The committee is packed with prominent reformers and is likely to come down hard on any misconduct by police and prosecutors.
That may provide a face-saving exit for Yudhoyono, who was reelected in July and styles himself as a clean pair of hands in a country awash in graft. Indonesia was ranked 126th out of 180 in a 2008 global index by Transparency International, up from past years but still below neighboring countries like Malaysia and Thailand.
Yudhoyono's reputation has already taken a hit, however, as he was slow to go to bat for the KPK, says Kevin O'Rourke, an independent political analyst in Jakarta. "The president has definitely suffered a severe blow to his credibility on clean governance. But clearly the chance exists for him to reverse the situation," he says.
Choppy progress against corruption
Opinion polls in Indonesia show ingrained cynicism over corruption in government agencies, including the police and legal system. Under dictator President Suharto, who was forced out in 1998, graft was centralized and brazen. Efforts to clean up the system initially floundered, despite widespread calls for reform.
That began to change after the KPK was set up in 2003. With a modest $18 million annual budget and around 600 employees, it used its extensive powers of wiretapping, arrest, and prosecution to target large-scale corruption.
Among those ensnared have been government officials, national lawmakers, public prosecutors, provincial governors, and central bankers. Last year, Aulian Pohan, a central bank official and a relative of Yudhoyono, was sentenced to jail. To many Indonesians, this underscored the president's willingness not to interfere in the course of justice.
But that stance isn't viable when the police are at loggerheads with the KPK and impeding its operations, says Mr. O'Rourke. It also reflects poorly on Yudhoyono's appointed police chief who was caught on the wiretaps. He may face pressure to step down if the fact-finding commission releases a critical report.
Agency's chief turned his senior officials in
The police investigation into the KPK is linked to the arrest earlier this year of the agency's chief commissioner, Antasari Azhar, who is on trial for allegedly murdering a man who tried to blackmail him over a love affair. Police claimed that Mr. Antasari had revealed bribe-taking by KPK officials in return for lifting travel bans on other suspects involved in carrying out the murder.
Analysts say that Antasari, a former prosecutor whom many anticorruption activists opposed as the KPK's head, has a motive to sully the reputation of colleagues who can testify against him. At least one witness who alleged that bribes were paid to KPK officials has already recanted his testimony, according to the Jakarta Post.
Under the KPK's internal rules, the two commissioners were suspended from duties after police named them as suspects. They were arrested on Oct. 29 after police said their frequent press briefings had "disturbed the investigation." Neither has been charged.
Media plays watchdog
Indonesia's news media has played a crucial role in ensuring that accusations against KPK officials are held up to the light, says Staffan Synnerstrom, an expert on governance at the World Bank's office in Jakarta. That has made it harder to roll back an anticorruption fight that is popular with the public, even if it steps on powerful toes.
"The old forces are still very much in place. There are attempts to swing the pendulum back, now and then, but these efforts are becoming weaker," he says.
The row has overshadowed Yudhoyono's plans to convene his cabinet and key government agencies this week in order to meet targets for his first 100 days in office, including spending on key infrastructure projects. Investors say corruption and red tape are among the biggest impediments to investing in such projects.