-Caveat Lector-

Indonesian government calls off Suharto corruption investigation


By Seth Mydans and Philip Shenon
NEW YORK TIMES NEWS SERVICE

October 12, 1999


JAKARTA, Indonesia -- The government of President B.J. Habibie yesterday
announced that it was dropping an investigation of possible corruption by
former President Suharto, defying public sentiment days before an assembly is
to choose the next president.

In a statement that drew an angry response, Attorney General Ismudjoko said
that a yearlong investigation had failed to find enough evidence to proceed
with a case against Suharto, 78.

Ismudjoko's inquiry centered on what had seemed the most accessible area of
investigation, a complex of seven charitable foundations. Critics said
Suharto had laundered huge payoffs through those foundations as part of a
corrupt regime that earned him many billions of dollars.

Habibie did not comment Monday. But the announcement appears to reflect his
continuing allegiance to his longtime mentor. Habibie succeeded Suharto when
he was forced to resign in May 1998.

Some analysts said the move also reflected worries among Habibie and other
veterans of Suharto's government that they could be tarred by a genuine and
wide-ranging investigation into corruption.

"We expected this," said Tenten Masduki, who heads Indonesian Corruption
Watch. "No one in this country is brave enough to put Suharto on trial."

But the announcement also sharpened what will be one of Habibie's crucial
liabilities as an electoral assembly makes its endorsement next week for the
next president -- his closeness to Suharto.

Most assembly members were elected in a nationwide vote in June. Habibie's
party came in second to the party of Megawati Sukarnoputri. But both
candidates remain strong contenders for the presidency, which the 700-member
assembly is to decide Oct. 20.

A deputy chairman of Megawati's party, Kwik Kian Gie, criticized the
announcement and the entire investigation.

"It is very clear that all of this is just a mockery," he said. He promised
that Megawati would reopen the inquiry if she won the presidency.

A number of assembly members also voiced criticism, including the
parliamentary representative of the powerful military bloc.

Even the party that Habibie inherited from Suharto, Golkar, saw a backlash on
the day before it is to announce whether it will continue to back Habibie as
its candidate.

"Politically, this is a major factor," said Marzuki Darusman, who heads an
anti-Habibie faction in Golkar. "It could damage Habibie's candidacy."

Meanwhile, in Dili, East Timor, the U.N.-backed peacekeeping force in East
Timor accused the Indonesian army of providing support to an
anti-independence militia that fired on peacekeepers over the weekend,
raising fears that the army has decided to try to sabotage the peacekeeping
operation.

Australian Maj. Gen. Peter Cosgrove expressed suspicions that Indonesian
soldiers and police officers joined the militia members in firing on the
Australian peacekeepers with assault rifles Sunday.





Copyright 1999 Union-Tribune Publishing Co.

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