A Lobbying Bonanza

Indonesia hired well-connected firms to restore U.S. funding cut off after 1991 massacre

By Andreas Harsono
International Consortium of Investigative Journalists

A long string of human rights abuses had put Indonesia in a deep hole with the United States, but then the September 11 terrorists struck. Suddenly the hole got shallower.

No country has more Muslims than Indonesia, and it is the world’s fourth most populous country after China, India and the United States, with almost twice as many people as Japan. So in the emerging post-9/11 world of Islamist terrorism, Indonesia’s importance to the U.S. suddenly increased.

The island nation had inaugurated a new president just months before the 9/11 attacks and, by chance, the White House had issued an invitation for her to visit on September 19. As it turned out, the new president, Megawati Sukarnoputri, was one of the first state visitors to the White House after the terrorists struck — and the timing couldn’t have been more propitious.

For President Bush, it was an occasion to make friendly overtures to a huge nation that could be a crucial ally in dealing with terrorists.

For President Megawati, it was an opportunity to advance a public relations campaign so relentless that private sources politically connected to the Indonesian government spent more than $1 million to hire a team of Washington lobbyists led by Bob Dole, the former Senate Republican leader and 1996 presidential nominee. Indonesia’s lobbying goals included the resumption of controversial military aid that had been cut off after its troops massacred more than 100 demonstrators in East Timor in 1991.

The relentlessness paid off:

• In the three years after the 9/11 attacks, Indonesian forces benefited from training in counterterrorism techniques and skills worth more than $5 million under the Pentagon’s new post-9/11 Regional Defense Counterterrorism Fellowship Program (CTFP) — even though for much of that time other similar U.S. military assistance was embargoed because of Indonesia’s human rights record. An analysis of foreign military training and assistance conducted by the International Consortium of Investigative Journalists (ICIJ) found that Indonesia received more CTFP training than any other country — twice as much as the second-place nation, the Philippines.

• In February 2005 U.S. Secretary of State Condoleezza Rice declared the Indonesian military sufficiently reformed to warrant resumption of aid under the International Military Education and Training (IMET) program, despite skepticism from Congress and human rights organizations about the extent of reform.

• In November 2005, just over four years after Megawati visited the White House, the last restriction on U.S. military aid was lifted. The State Department announced that aid would resume under the Foreign Military Financing program (FMF) with the goals of modernizing Indonesia’s military and supporting U.S.-Indonesia counterterrorism cooperation. The program provides funds for foreign militaries’ purchases of U.S. military goods, services and training.

• In March 2006 Rice visited Jakarta and announced that the U.S. would increase military cooperation and boost the training budget. “A reformed and effective Indonesian military is in the interest of everyone in this region, because threats to our common security have not disappeared,” she said. “We look for continued progress toward greater accountability and complete reform.”

Indonesia was out of its hole, and U.S. military aid was flowing again. Around the time of the FMF announcement, according to lobbying records, the country ended its relationship with Richard L. Collins & Co., which had succeeded Dole’s team as one of Indonesia’s primary lobbyists in Washington. But questions remain over who exactly paid for the lobbying.

President’s supporters steered contract to Dole

Indonesia spreads over five major islands and more than 17,000 smaller ones in archipelagoes between Malaysia and Singapore. It stretches almost to Australia and across such exotic locations as Bali, Borneo, Java, New Guinea and Sumatra as well as the ancient Spice Islands (now called the Moluccas), where nutmeg originated. Its government is struggling to establish itself as a democracy after the brutal and corrupt 32-year dictatorship of Suharto, who, like many Javanese, uses only one name. During Suharto’s reign, the military was reported to have killed as many as 3 million Communists and other dissidents on the outer islands; estimates of Suharto’s reportedly embezzled fortune start at $15 billion.

The nation’s politics in the decade since Suharto stepped down in 1998 have been tangled and shadowy, with almost continuous insurgencies on the country’s different islands and the military still playing a powerful role in politics. So perhaps it is little wonder that Indonesia’s three Washington lobbying contracts were signed, successively and respectively, by a politically connected Indonesian businessman, a man claiming to be authorized to sign on behalf of a foundation started by a former president who is a moderate Muslim cleric, and the government’s intelligence agency.

Indonesia held its first direct presidential election in 2004, and international monitors declared it well run. In it, Megawati — the daughter of Sukarno, Indonesia’s first president after independence following World War II — was defeated by Susilo Bambang Yudhoyono, a retired three-star general who had been her chief security minister and ran as a reformer. Foreign Agents Registration Act (FARA) records on file with the Department of Justice in Washington show that the lobbying contract with Dole’s firm, Alston & Bird, was terminated immediately after Yudhoyono was inaugurated.

The Alston & Bird contract had been negotiated by a powerful group of Megawati supporters after she became president, and it was signed by one of them, Yohannes Hardian Widjonarko, then the treasurer of the Kawula Alit Nusantara Foundation, an organization led by Megawati’s husband Taufik Kiemas. Taufik is also a leader of Megawati’s Indonesian Democratic Party of Struggle. Its executive director is Tjahjo Kumolo, who heads the party’s faction in the Parliament.

The one-year contract was signed on December 1, 2003, by Frank (Rusty) Conner III, the partner in charge at Alston & Bird LLP, and Widjonarko. The contract was also signed by Dole and specifically indicated that he would coordinate Alston & Bird’s lobbying efforts for Widjonarko and his “designated representatives.” The contract called for payment of $200,000 per month and laid out 12 lobbying objectives including increasing trade between America and Indonesia; seeking a resumption of the military assistance; and providing counsel to the Indonesian government regarding business, legal and financial issues. In addition to the retainer, the contract allowed the firm to charge up to $2,500 per month for travel, meals and administrative costs such as photocopying and computerized research.

The engagement specified that Dole was to “actively participate in and supervise our day-to-day work under this agreement. All work will be coordinated from his office.” And there was much to supervise: the work of nine other Alston & Bird lobbyists assigned to work on Indonesia’s behalf, including two other partners, Jonathan Winer, a former deputy assistant secretary of state for international law enforcement, and Thomas Boyd, who headed the Office of Policy Development in the Department of Justice under President George H.W. Bush. Others working on the account (some of whom have since left the firm) included Michael Marshall, a former spokesman for Dole; John Schall, a former policy adviser to the senior Bush; Cameron Lynch, a former aide to Sen. John Ashcroft; plus Atiqua Hashem, a lawyer then working out of Alston & Bird’s Atlanta office .

The agreement had a follow-up detail three weeks later that brought Indonesia’s government directly into the arrangement, through a December 18, 2003, letter from Laksamana Sukardi, Indonesia’s minister for state enterprises. Records show that Sukardi, whose office controlled more than 150 companies ranging from oil exploration to shipping to telecommunications , asked Dole to advocate personally for the state-owned oil company Pertamina in a multimillion-dollar legal case.

FARA records show that the Dole team called and met with then-Homeland Security Secretary Tom Ridge as well as Karen Brooks, then the Asian affairs director for the National Security Council. They also met with U.S. Agency for International Development officials, including its Jakarta director, William Frej, and lobbied officials of the United States-Indonesia Society.

Those records further show that they made contact with the offices of then-National Security Advisor Condoleezza Rice; Richard Armitage, deputy secretary of state; and Cofer Black, the State Department’s counterterrorism coordinator and former head of the CIA’s counterterrorism center. The records show that the lobbyists called or met with State Department officials 12 times, including Ralph Boyce, the U.S. ambassador to Indonesia.

According to listings of the firm’s expense accounts filed with its Department of Justice FARA papers, Dole and Atiqua Hashem traveled to Jakarta in December 2003 and again in March 2004 (a trip on which Winer joined them). The same records show Hashem traveled extensively between Atlanta and Washington to work with Dole.

On Capitol Hill, Dole’s team made contact with the offices of Sens. Patrick Leahy, D-Vt., and John Kerry, D-Mass., and with many other members of Congress and their staffs, promoting not only the resumption of military aid but also Indonesia’s status as the biggest Muslim democracy and an ally in the Bush administration’s war on terror.

The total cost for all this, according to FARA records, was $1,044,147. From November 1, 2003, to April 30, 2004, Alston & Bird reported $846,163 in income from Widjonarko. From May 1, 2004, until October 20, 2004, the reported income was $197,984.

Where did all the money come from? It depends on whom you ask.

Alston & Bird’s Jonathan Winer wrote in a FARA document that Widjonarko “is responsible for financing and controlling this engagement. … Although this engagement may from time to time also be directed by individuals in the government of Indonesia, to my best knowledge, Mr. Widjonarko is not supervised, owned, controlled, financed, or subsidized by a foreign government, foreign political party, or other foreign principal.”

In an interview with ICIJ, Muhamad S. Zulkarnaen, another member of the group of Megawati supporters who coalesced around her husband, declined to comment about who contributed to the Alston & Bird payments. He denied that Sukardi’s ministry of state enterprises funded the lobbying campaign, directly or indirectly, instead characterizing the funding as “political donations.” When asked by ICIJ who contributed those “political donations,” he responded that, “Well, you don’t keep that kind of list.”

The FARA documents, however, mentioned the name of “P. Sondakh,” an apparent reference to Peter Sondakh, a powerful businessman who controls the Rajawali Group, whose interests range from cigarette to cement productions. Winer sent Sondakh a package in June 2004, according to the firm’s FARA filings that year and two other sources, a Rajawali Group executive and an Indonesian diplomat in Washington, D.C., speaking with ICIJ on condition of anonymity, confirmed that Taufik, Megawati’s husband, had asked the Rajawali Group for financial contributions.

So what did all of this lobbying accomplish? When the contract was terminated after Yudhoyono became president in October 2004, the U.S. embargo on IMET and FMF funds was still in place and the Pertamina case had not been resolved. In a phone call with ICIJ, Winer said that the firm has a policy of not commenting on its work for clients unless authorized by the client; Widjonarko did not respond to repeated requests for an interview by an ICIJ reporter in Indonesia. Zulkarnaen told ICIJ that the lobbying accomplished almost nothing.

After the Dole team had left the field, in February 2005, Condoleezza Rice, who had become secretary of state a month earlier, announced that reform of Indonesia’s military was sufficient to justify resumption of IMET funding.

Military, intelligence agency linked to abuses

Military reform in Indonesia is a major challenge. Suharto’s military conducted massacres on an all but unimaginable scale. Today many of the officers of that era are still serving in the military or are retired but engaged in politics.

Indonesia’s military has long operated with unusual independence; the International Relations Center quotes experts who estimate that only 25 to 30 percent of the military’s funding comes from the government’s budget, “with the rest coming from ‘taxes’ on natural resource extraction, bribes, and other forms of ‘informal’ financing.”

Further, Indonesia’s military is deeply engaged in the country’s various conflicts. Suharto had used the military to force outlying parts of the islands to become part of Indonesia against their will and, as a result, troops were routinely engaged with separatist insurgencies, notably in East Timor, Papua and Aceh provinces.

East Timor, which is predominantly Catholic and Portuguese-speaking, became an autonomous nation after a United Nations-supervised referendum in 1999, but even after the referendum Indonesian troops and militia groups launched attacks there. At other far reaches of the archipelago, the special region of Aceh and province of Papua have achieved ceasefires and negotiated greater autonomy. Charges of repression and gross human rights violations, once common, continue at lesser volume in both Aceh and the predominantly Christian Papua.

In November 2001, Papua leader Theys Eluai was assassinated. An investigative commission concluded that a unit of Koppasus, the army’s special forces, was involved in planning and executing the murder.

In August 2002, gunmen attacked cars passing on a mountainous road to a copper mine in Papua that’s operated by Freeport-McMoRan, now the world’s largest publicly traded copper company. Two American teachers and one Indonesian teacher at Freeport’s school were killed in the ambush. The attack alarmed Washington.

John Otto Ondawame, spokesman for the Free Papua Movement, which is known by the initials OPM, issued a statement alleging that the attack may have been “orchestrated by the Indonesian military.” The Papua police and Elsham Papua, a human rights group, also said they suspected the military. Indonesia’s Foreign Ministry spokesman Marty Natalegawa countered that “there are indications the act was committed by elements of OPM.” In November 2006, a Papuan guerilla fighter, Antonius Wamang, was convicted and sentenced to life in prison, and six other defendants received lesser sentences. But human rights advocates insist that Kopassus officers played a part and that a police officer supplied the bullets Wamang used.

Indonesia’s intelligence agency, Badan Intelijen Negara (BIN), has also long been linked to human rights violations, including the 2004 assassination of human rights campaigner Munir Thalib.

According to Central Jakarta district court documents, Munir was poisoned with arsenic sprayed on his fried noodles during a Garuda Indonesia flight from Jakarta to Amsterdam on September 7, 2004. In December 2005, the court sentenced a Garuda pilot, Pollycarpus Budihari Priyanto, to 14 years in prison for poisoning Munir and for carrying forged travel documents. His conviction was overturned by Indonesia’s Supreme Court, and in April 2007 two new suspects were named by Indonesia authorities.

The court documents note that Pollycarpus had no personal motive to kill Munir; the proceedings also brought to light 41 telephone conversations between Pollycarpus and a mobile phone number, 0811-900978, before and after Munir’s assassination. The mobile phone was registered to Maj. Gen. Muchdi Purwopranjono, a deputy director at BIN and a friend of Widjonarko, the businessman who signed the Alston & Bird lobbying contract.

In his court testimony, Purwopranjono confirmed that 0811-900978 was his mobile phone number but he said it was frequently used by his driver and aides. He denied ordering Munir’s assassination or having ever met Pollycarpus. Purwopranjono, who was the commander of the notorious Koppasus special forces in the Suharto era and retired from the military in 1999, confirmed that Widjonarko is his friend. BIN didn’t respond when contacted several times for comment.

Second lobbying effort pays off

Indonesia’s lobbying campaign in Washington resumed in May 2005 with the hiring of Richard L. Collins & Co., a smaller boutique firm. This time, BIN, the Indonesian intelligence agency implicated in the Munir assassination, was paying the bills.

Its selection of the firm was no coincidence: Collins & Co. didn’t have a Bob Dole on its roster, but its vice president for international business at the time, Eric Newsom, was a former assistant secretary of state for political-military affairs in charge of running the IMET and FMF military aid programs — the very programs Indonesia wanted restored. He was also a former top aide to Sen. Patrick Leahy, D-Vt., a key figure in the Senate on human rights issues and U.S.-Indonesia policy.

BIN initially lobbied from the shadows, hiding behind a former Indonesian president’s charitable foundation. But the connection between BIN and the charitable foundation, the Gus Dur Foundation, is documented in papers Collins & Co. filed in compliance with FARA. The foundation was established by former Indonesian President Abdurrahman Wahid, who goes by the nickname Gus Dur and is known for his moderate politics and support for human rights.

Gus Dur retained Collins & Co. for $30,000 a month to lobby to “remove legislative and policy restrictions on security cooperation with Indonesia,” according to a copy of a signed initial contract. But in FARA forms that accompany the contract the firm noted, “For the purposes of this contract, the Gus Dur Foundation’s activities are directed and funded by the [BIN]. The nature of the activities carried out under this contract were defined in consultation with representatives from the [BIN] and the [BIN] provides the funding. . . .”

The FARA documents show that on July 31, 2005, the contract between Collins & Co. and the Gus Dur Foundation was terminated and, effective September 1, a new contract for the same monthly amount was executed directly between Collins & Co. and BIN. Collins & Co. lobbyists did not return repeated calls requesting comment.

The initial contract defines Collins & Co.’s mission in the context of Indonesia’s “obstacles to a more cooperative relationship with the United States, particularly in the area of military cooperation . . . the image of Indonesia, especially in the United States Congress, remains highly negative and colored by events in East Timor and other disturbed areas like Papua and Aceh.”

The FARA filings also reflect the fact that part of Collins & Co.’s charge was to assuage congressional concerns over the in-flight assassination of Munir, the Indonesian human rights campaigner. In the U.S. Foreign Operations Appropriations Bill for fiscal year 2000, Congress made the resumption of military aid contingent on reform of the Indonesian military and prosecution of major human rights offenders.

The FARA records show that between June and October of 2005, Collins & Co. lobbyists, sometimes accompanied by BIN officials, met with several key members of Congress and their staffs. Among them were Sen. Leahy, and Sen. Chuck Hagel, R-Neb., and Sen. Lisa Murkowski, R-Alaska, as well Rep. Jesse Jackson Jr., D-Ill. and an aide to Sen. Barack Obama, D-Ill..

Newsom accompanied BIN officials As’ad Said Ali and Burhan Mohammed to a meeting with Sen. Leahy and a key aide just off the Senate floor on July 21, 2005.

According to Tim Reiser, Sen. Leahy’s top aide on the Senate Appropriations Committee’s Subcommittee for State, Foreign Operations, and Related Programs (whose annual funding bill finances the IMET and FMF programs), Sen. Leahy agreed to the 15-minute meeting so he could express his opposition to the resumption of full military assistance to Indonesia. Sen. Leahy told As’ad that he didn’t think sufficient reform had taken place.

The lobbyists from Collins & Co. also met with American Samoa’s representative, Eni Faleomavaega, to discuss West Papua. Faleomavaega, a Democrat, is the most important, if not the only, champion of the Papuan cause on Capitol Hill. He has spoken about Indonesia “slaughtering” 100,000 people since its takeover of West Papua in 1969.

The lobbying campaign was certainly not the only reason military assistance was eventually resumed; in fact, the push for reinstating IMET and FMF for Indonesia began shortly after the Bush administration took office in 2001. The administration and Republican allies in Congress say the previous policy of punishing Indonesia for human rights violations had not paid dividends; the much-hoped-for reform of the Indonesian military and security apparatus had not occurred.

In November 2005, the FMF restriction was lifted — and, the FARA records show, Indonesia’s contract with Collins & Co. came to an end.

In an interview with the Inter Press Service news agency, Sen. Leahy called the decision “premature and unfortunate,” saying resumption of a military training program for Jakarta “will be seen by the Indonesian military authorities who have tried to obstruct justice as a friendly pat on the back.”

Sen. Leahy inserted a provision in the Senate version of the fiscal 2007 Foreign Operations Appropriations Bill (not yet passed by Congress ) that would require the Secretary of State to submit a report to the Senate and House Appropriations committees detailing “the status of the investigation of the murder of Munir Said Thalib, including efforts by the Government of Indonesia to arrest any individuals who ordered or carried out that crime and any other actions taken by the Government of Indonesia (including the Indonesian judiciary, police and the State Intelligence Agency [BIN]), to bring the individuals responsible to justice.”

How did Gus Dur find his name attached to lobbying paid for by BIN? Muhyiddin Aruhusman, a close associate of Gus Dur’s, signed the original Collins & Co. contract on behalf of the Gus Dur Foundation. Ikhsan Abdullah, the foundation’s secretary, told ICIJ that Aruhusman, a member of Parliament, had no official position at the foundation. Asked whether he was authorized to sign on behalf of the foundation or whether Gus Dur himself knew about the contract, Aruhusman said, “I can’t discuss more. I have to bear in mind Gus Dur’s good name. He didn’t know.”

In a September 2006 news conference, following inquiries by ICIJ on the matter, Gus Dur acknowledged letting BIN use his foundation, saying that it was done “for the sake of the nation.”

“Neither the Gus Dur Foundation nor I have ever made any deal with BIN nor hired a U.S. company to seek resumption of the military training program,” Gus Dur told the media. He told reporters in Jakarta that BIN deputy chief As’ad Said Ali and several other intelligence agents had met with him one day in 2004, asking him if it was okay to make use of his name for the national interest. “Upon hearing the words ‘for the sake of the nation,’ I replied: ‘Please do.’ And I had no idea this conditional permission would be misused to lobby for the lifting of the military embargo,” he said.

Counterterrorism efforts offset by tensions

What did the United States get in return for opening the military aid spigot to Indonesia?

The island nation became an early, if somewhat reluctant, partner in U.S. counterterrorism efforts. After 9/11, President Megawati was careful about cracking down on suspected militants for fear of inflaming the country’s vast Muslim majority. The U.S., well aware of this dynamic, also took an early kid-glove approach, declining initially to include Indonesian extremist groups such as Laskar Jihad and Jemaah Islamiyah (JI) on its list of terrorist organizations, despite the fact that JI’s founder, Riduan Isamuddin, an Indonesian national better known as Hambali, was a known associate of Al Qaeda.

But over the years, the Indonesian government quietly stepped up its pressure on homegrown militants, arresting and prosecuting hundreds of terrorist suspects, many of them in connection with the 2002 Bali nightclub bombings , which killed 202 people and injured 209, largely Australian tourists. A steady drumbeat of attacks has continued since: a 2003 Marriott Hotel bombing that killed 12; a 2004 bombing of the Australian Embassy in Jakarta, which killed 10; and 2005 suicide bombings in Bali that killed 19.

In late 2006, in a visit with Pakistani President Pervez Musharraf, President Yudhoyono pledged to increase anti-terrorism cooperation with Pakistan, signaling the convergence of two of America’s key counterterrorism allies. Indonesia is also now part of the State Department’s Regional Strategic Initiative, an effort to link key governments in a particular area — in this case, Indonesia, Malaysia and the Philippines — to combat terrorism. All three countries are combating local insurgencies that at times have been linked to Islamist extremists.

But tension continues over whether BIN, which hired the lobbyists who helped push a resumption of military aid, was responsible for the assassination of a human rights advocate. Tension also exists over whether the Indonesian military, which benefits from the military aid, was behind the Freeport mine ambush that killed two Americans.