Corporate Executives are Liable for Corporate Crime

Leo Wisnu Susapto, Robert Sidauruk

With broad definition of criminal punishment for corporations under Indonesian regulatory framework, company executives have endured massive apprehensions in their decision making, regardless whether the decision taking is within their authority.

Gandjar Laksamana Bonaputra, criminal law lecturer at Universitas Indonesia, stated that the consequence of having such broad definition caused the dilation on the scope of criminal liability. Now, not only the corporations are liable, their executives are also liable.

“Company executives are afraid to be criminalized for unlawful acts committed on behalf of the company,” he said during a seminar held by Universitas Indonesia Law FacuIty Alumni (ILUNI FHUI) in Jakarta (8/5).

Gandjar emphasized that it is not the criminalization issue that should be of concern, but the measure to call a business judgment without mens rea (guilty mind) as a criminal act that is far more important.

Duringthe same event, Alan Frederik, chief legal counsel at PT Pertamina (Persero), echoed the same tone.  To avoid fallacious criminalization, Alan asserted that the criminal investigation should be oriented on “state’s financial loss” as the main element.

In regards to state-owned enterprise (BUMN) losses, Alan explained that it is still considered as state losses. It is due to the current regulatory framework, namely Law No. 31 of 1999 on Corruption and Law No. 17 of 2003 on State Financial, which categorized BUMN’s funds as State’s funds.

“By this situation, it is not impossible to have business activity criminalized,” he added.

Alan asserted that BUMN losses must be considered as a business risk. Therefore, the enquiry should emphasize the relation between the losses and duty of care owned by company executives.

Meanwhile, Denny Indrayana, Deputy Minister of Law and Human Rights, took a simple measure on corporate crime. “Take it to the court. So we can see whether the corporate policy and discretion violated the prevailing laws and regulations,” he concluded.

(hot/jt)

Leo Wisnu Susapto, Robert Sidauruk

With broad definition of criminal punishment for corporations under Indonesian regulatory framework, company executives have endured massive apprehensions in their decision making, regardless whether the decision taking is within their authority.

Gandjar Laksamana Bonaputra, criminal law lecturer at Universitas Indonesia, stated that the consequence of having such broad definition caused the dilation on the scope of criminal liability. Now, not only the corporations are liable, their executives are also liable.

“Company executives are afraid to be criminalized for unlawful acts committed on behalf of the company,” he said during a seminar held by Universitas Indonesia Law FacuIty Alumni (ILUNI FHUI) in Jakarta (8/5).

Gandjar emphasized that it is not the criminalization issue that should be of concern, but the measure to call a business judgment without mens rea (guilty mind) as a criminal act that is far more important.

Duringthe same event, Alan Frederik, chief legal counsel at PT Pertamina (Persero), echoed the same tone.  To avoid fallacious criminalization, Alan asserted that the criminal investigation should be oriented on “state’s financial loss” as the main element.

In regards to state-owned enterprise (BUMN) losses, Alan explained that it is still considered as state losses. It is due to the current regulatory framework, namely Law No. 31 of 1999 on Corruption and Law No. 17 of 2003 on State Financial, which categorized BUMN’s funds as State’s funds.

“By this situation, it is not impossible to have business activity criminalized,” he added.

Alan asserted that BUMN losses must be considered as a business risk. Therefore, the enquiry should emphasize the relation between the losses and duty of care owned by company executives.

Meanwhile, Denny Indrayana, Deputy Minister of Law and Human Rights, took a simple measure on corporate crime. “Take it to the court. So we can see whether the corporate policy and discretion violated the prevailing laws and regulations,” he concluded.

(hot/jt)

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