JAKARTA: The North Sumatra Prosecutor’s Office has detained two executives from PT Indonesia Aluminium (Inalum) for alleged corruption in aluminum alloy sales to PT Prima Alloy Steel Universal (PASU) in 2019, which incurred an estimated US$8 million in state losses.
The two, who have been identified by their initials as DS, senior executive vice president of business development, and JS, head of sales and marketing, have been held at the Tanjung Gusta Penitentiary since Wednesday for a period of 20 days.
Indra Hasibuan, head of legal information at the prosecutor’s office, said the pair was detained over potential risks including flight, destruction of evidence and repeat offence
“They were detained after investigators declared them as suspects [...] based on two pieces of evidence” indicating that the payment scheme for the 2019 alloy sales had been changed, Indra said on Wednesday (Dec 17).
The original deal involved a cash payment with a domestic letter of credit (SKBDN), which was changed to a document against acceptance (D/A) with a time limit of 180 days. Under this scheme, PASU did not pay for the aluminum alloy that Inalum had shipped.
“The action caused state losses of an estimated US$8 million. The actual value is still being calculated,” Indra said. He added that both suspects were being charged under Law No. 31/1999 on corruption eradication and potentially faced a maximum sentence of 20 years in prison.
Earlier on Nov 13, investigators from the prosecutor’s office raided Inalum’s offices in Kuala Tanjung, Sei Suka district, Batu Bara regency, seeking any documents related to the 2019 sales deal.
Aside from the company archives, they particularly targeted the offices of company executives, including the managing director, the directors of finance, strategic services, production, business development and human capital as well as the logistics head.
Among the confiscated documents were Inalum’s financial reports, shipping and sales documents and other related sales records, from planning to payment. Mochamad Jeffry, special crimes assistant at the North Sumatra Prosecutor’s Office, said the case would be developed further to uncover all parties involved in the alleged corruption.
He added that investigators had questioned 10 witnesses in connection with the case. “If we find that other parties were involved, prosecutors will not hesitate to take actions in accordance with existing laws,” he said.
Inalum is a wholly owned subsidiary of state-owned holding company Mining Industry Indonesia (MIND ID), which is owned by state asset fund Danantara, launched in February 2025.
The other MIND ID subsidiaries are diversified miner PT Aneka Tambang (Antam), coal producer PT Bukit Asam (PTBA), tin producer PT Timah and nickel producer PT Vale Indonesia, all publicly listed, as well as gold and copper producer PT Freeport Indonesia, which is unlisted. - The Jakarta Post/ANN
