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Cablegate: Medan Mayor Busted On Corruption Charges, Vice Mayor

VZCZCXRO3778
PP RUEHCHI RUEHCN RUEHDT RUEHHM
DE RUEHJA #0016/01 0031003
ZNR UUUUU ZZH
P 031003Z JAN 08
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC PRIORITY 7550
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS
RUEHBY/AMEMBASSY CANBERRA 1838
RUEATRS/DEPT OF TREASURY WASHDC
RUEAWJB/DOJ WASHDC
RUEHLMC/MILLENNIUM CHALLENGE CORP WASHINGTON DC

UNCLAS SECTION 01 OF 02 JAKARTA 000016

SIPDIS

SENSITIVE

AIDAC

SIPDIS
DEPARTMENT FOR INL, EAP/IET, INR/EAP
DEPARTMENT PLEASE PASS AID
TREASURY FOR IA
USAID FOR ANE/EAA
MCC FOR MARIA LONGI

Medan Cable 001 for 2008

E.O. 12958: N/A
TAGS: PREL PGOV PINR ECON SOCI KCRM ID
SUBJECT: Medan Mayor Busted on Corruption Charges, Vice Mayor
Reportedly on the Run

Ref 07 Jak 3349

JAKARTA 00000016 001.2 OF 002


1. (SBU) Summary: Notoriously corrupt Medan Mayor Abdillah was
arrested in Jakarta on January 2 by the National Corruption
Eradication Commission (KPK) in a case which also implicated his
vice mayor and senior provincial legislators. The arrest was not
unexpected and the arrest of the Vice Mayor is reportedly imminent.
The implicated legislators appear to have escaped serious charges in
exchange for the return of more than USD 44,000 given to them by the
mayor and vice mayor. This case constitutes the first significant
arrest by the KPK since a controversial new Board of Commissioners
was installed in December. End Summary.

Mayor of Medan Arrested, Vice Mayor Sought
------------------------------------------
2. (SBU) Medan Mayor Abdillah was arrested in Jakarta on January 2
on corruption charges. Mayor Abdillah and Vice Mayor Ramli had been
named as suspects in a kickback scheme involving the purchase of
fire engines and other scams. The arrest came on January 2 after an
extensive and protracted investigation. According to KPK
Spokesperson Johan Budi, Abdillah will remain in detention for the
next 20 days while formal charges are prepared against him.

3. (SBU) After the arrest, Deputy KPK Chairman Chandra Hamzah
issued a public statement accusing Abdillah of enriching himself and
others through corrupt acts costing the government more than USD 3.2
million, including a USD 330,000 mark-up scheme on city-purchased
vehicles. Hamzah detailed additional allegations including budget
and contracting irregularities, awarding of lucrative contracts to
shell companies and firms linked to his family, and shady land deals
made for personal enrichment. This case is the first significant
arrest by the KPK since a controversial new Board of Commissioners
was installed in December. (reftel)

4. (SBU) The KPK has also issued an order for the arrest of Medan
Vice Mayor Ramli on similar charges. KPK officials have stated
publicly that they expect to arrest Ramli on January 3. According to
several reports, Ramli did not show up for questioning and may be on
the run.

5. (SBU) That Abdillah would be arrested on corruption charges has
been an open secret in Medan for more than a year. In July 2007,
after an anonymous official leaked details about the investigation
to the local press and the KPK announced that the mayor and vice
mayor were subject to a travel ban, Abdillah virtually disappeared
from the public sphere.

6. (U) Following a short period during which it appeared that the
investigation had stalled, Abdillah critic Leo Siagian, Coordinator
of Civil Society for the Democratic Party, told local media on
December 16 that he expected Abdillah to be behind bars before the
end of the year. A hastily arranged visit by President Yudhoyono to
Medan on December 19, reportedly made in part to assess the possible
effects this case might have on the North Sumatran provincial
elections coming up in April 2008, was considered the final step
clearing the way for Abdillah's arrest.

Legislators Cooperate with Investigators
--------------------------------------------- ----
7. (SBU) Several senior provincial legislators, including the
President of the North Sumatran legislature, Abdul Wahab Dalimunthe,
were also implicated in this case. The KPK questioned Dalimunthe
extensively, and he eventually agreed to turn over nearly USD 11,000
to the KPK on December 18. According to Dalimunthe, Vice Mayor Ramli
gave him the money for mosque construction, an explanation few find
credible. Another legislator, Yulisar Parlagutan Lubis, returned
USD 33,000 to the KPK. Contacts in Medan have said that Dalimunthe
and Lubis returned the money and promised to cooperate with
investigators in order to avoid serious charges. KPK officials have
told the press that the men's cooperation will mitigate possible
penalties but not absolve them from guilt.

Who's Minding the Store?
------------------------
8. (SBU) City Secretary (Medan's most senior civil servant)
Affifudin Lubis is currently acting mayor of Medan. On December 27,
Lubis told Consulate Medan that he had been designated acting mayor

JAKARTA 00000016 002.2 OF 002


until further notice. Lubis added that Abdillah had already been in
Jakarta for several weeks at the insistence of KPK investigators.
Lubis is considered to be a clean, competent administrator and was a
recipient of a U.S. International Visitor grant. He remains a close
contact of the Consulate.

9. (U) This cable has been coordinated with Embassy Jakarta.
HUME

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