Critical Reflections on the Draft of State Secrecy Bill

Critical Reflections on the Draft of State Secrecy Bill

By David Raja Marpaung S.IP M.Def

Critical Reflection

          In a democracy, a state secret is public information for the time being kept secret to the public. State secrets is a limitation or exclusion of the right to information as human rights. Then the principle must not be defeated in a democracy is that all public information, including information owned by the state, is publicly owned. As an exception, setting its state secrets should be limited, limitatif and applies to only a certain period

           Attempts to institutionalize the principles of state secrecy or confidentiality information depart from the assumption that disclosure will lead to excessive number of adverse impacts to the national interest. The publication documents a particular country may threaten the safety of the state, interfere with state efforts to maintain national security. The government then implemented the system of classification of information: penyembuanyian or information storage system based on the confidentiality of certain confidentiality considerations. Some signs were created to determine the information that is not publicly accessible, the following sanctions for violations of law.

        On the other side of the confidentiality classification of information is a necessity for every country and every government. The problem of experience in many countries showing that  the application of information classification system is more influenced by the subjectivity of the organizers of the government. 

      Status of state secrets is often intended to protect the reputation of the government, bureaucratic interests, and not really to protect the interests of the state. Government's credibility and reputation are considered more important than the public's right to obtain information about government performance. Steven Aftergood (1996) distinguish between a pure state secrets (genuine national secrecy) on the one hand, and state secrets that are political (political secrecy) and a secret bureaucracy (bureaucratic secrecy).This distinction is relevant because not all claims of state secrets refers to information that can actually harm the interests and national security. In other words, in practice the political and bureaucratic secrecy secrecy is much more dominant than genuine national secrecy.

          If you browse the trip a bill the State Secrets from initial planning done on the New Order era that followed after the reform (2006), until the final draft in 2010 showed some good shifts from the quantity number (article, paragraph, and grains), and in terms of substance. However, that becomes interesting when reformulated State Secrets Bill back in 2010 to the needs of the national legislation program 2010-2014. Despite the shift, but there are some subjects which vulnerability to the emergence of a regime of secrecy. For that, the next description will be presented some important points that become critical reflection

First, the problem frame in an effort to categorization or scope to be secret. When putting state secrets in the national security of the poles need to be strengthened some of the scope associated with the instrument. The design that is just shifting a few points that there are exceptions to the Law No.14 of 2008. This condition shows that no major foothold or big frame underlying the categorization of state secrets, especially when the state secrets mengkaiatkan elements in space slices with national security.

Secondly, concerning the next to be important for dipermasalahakan in the draft State Secrets, which is related to the categorization or the scope of the secret. In the case of objects dirahasikan detail, this design has provided a description of what a secret. Misalanya in the defense category of the country where things like plan a degree troop strength in a state of war or in operations or intelligence data gathering intelligence within the scope of the state. This is understandable as a secret object.However, there are some details that give intrepetasi ketidakperluan even an object to be secret. For example, the scope of national defense, the details of the plan allocation and expenditure related to the mission and duties of defense. This is a strange and raises the opportunity for fraud or gaps when the object is dirahasikan, especially related to budget planning.

Two things that then becomes a separate problem in which vagueness frame state secrecy which was followed by some details about the objects concealed by multii-interpretation creates an increase in insecurity and mistrust towards the implementation of this bill will be.

Third reflection, namely the mechanism (how) to determine the secrecy in which the design has incorporated its own discussion related to the classification and declassification of a state secret.However, explicit discussion is merely an administrative process in which the state agency designated as the executor / determinant of state secrets provide a written consideration of the impact when the object is not kept secret and considerations were presented to the president. Exposure to only provide an understanding of the administrative state, not a clear and specific mechanism.Associated with the classification and declassification, the relational design is not found between the type of state secret (so secret, secret, restricted secret) with the impact in case of abuse of state secrets. This becomes important in classifying and pendeklasifikasian a state secret.

Fourth, related to the retention period that is exposed in the draft where there are three levels, namely the very secret of 30 years, the secrets of 15 years, and a limited 5-year secret. The period of retention is important, but not always an information, objects, and activities that have implications for the integrity of the nation and the state (very secret) given 30 years. There is some information, objects, and activities that have a high content of vulnerability, but vulnerability can be completed in less than 30 years. For the discussion of declassification is not diuraiakan exposure associated with the termination of a state secret when the threat and vulnerability were completed in less than the retention period.

Description of classification, declassification, and the retention period to be important for the third to be reflected as a node in the establishment and termination of an object that has been and will be a state secret.

Fifth, the problems associated with the actor penyelengaara, determining, managing and protecting state secrets. In the design of which rolled out now, there is no clearly who will conduct such efforts. Which president served only as the holder of the highest authority who may delegate such authority to state institutions, ministries and institutions both non-ministerial institutions. Not clearly regulated and detailed who is entitled and responsible in menanganan perahasian secret object. This vulnerability memunuculkan democracy where the president as the highest authority in the governance of the state (government) is giving a blank check on the state agency to perform pelaksnanaan perahasian based on a breakdown of the state without chapter or verse in the design.

The six settings of anyone associated state officials because of the position and interests can use the state secrets. In this design has not been described in detail related to the description. Which later appeared in this State Secrets Bill, which every state officials when it will access and have the information, objects, and activities that require dirahasikan "right to know" based on the level or type of state secrets. Especially troubling is very related to the standard procedure in the process of ownership or access to the secret object which is not explained what the standard procedure detailed ownership or merely a "right to know" which became the basis of the process.

Seventh, critical reflection focused on the lack of discussion on the bill concerning the State Secrets about public access to the concealed object. Which then appear in the text of this bill is the only state officials who can access and have a secret object. This shows that this bill is very exclusive to the state apparatus (Stata apparatus). Ordinary people are not placed in an effort to control the risk of passing state secrets. There are only ordinary people can have access and when conditions are not done intentionally and unlawfully. It is very ironic, when passing this bill is still very strong efforts to re-establishment of the closure regime if meliha Seran has not given the role of the community to be able to obtain what is called secret.

Eighth, namely regarding the budget required in order perahasian an object that dirahasian. In this design has not provided a proposal related to how the funding or budget allocation in the management of a mechanism perahasian, there are only funds that are allocated to the state officials who work in the organization, designation, management, and protection of state secrets. This becomes important when looking at the tiers retention period that require fees in the system of handling state secrets. Not only that, the use of technology in the management of state secrets certainly require a large fee. For that, very surprisingly, when the budget or the allocation of funds perahasian not included, because it will raise suspicion about the origin of the high costs incurred when the design is implemented in the operational level.

Ninth, which is associated with the absence of a discussion of exceptions to confidentiality when confronted with the object of democratic principles. This becomes important because the state secrets are placed not only at the poles (the interests of national security), but context is important for democracy to be put forward in the draft. Moreover, when related to the investigation, prosecution, and examination at trial, an object of state secrets can not be placed as evidence in a public trial. It makes its own weaknesses, how when it collided in the implementation of state secrets or related to cases of criminal law.

Tenth, related to the dimensions of the supervision provided for in this draft has been presented concerning the supervision of two directions, namely the executive (past president), and the legislature (through sub-committees or special committees). This discussion does not make enough of an ideal dimension of supervision. Especially in the principles of democracy that puts the subject of checks and balances that demands for oversight of layered and tiered from the three pillars of the state (executive, judicial, and legislative), to the efforts of the supervision carried out by civil society or the actor who has the properties independent.

Tenth exposure associated with peramasalahan contained in the substance indicates that the State Secrets Bill was still in the level of substance terkai debate with democratic principles with the interests of national security. If you look at the draft to be fair when the civil society need to reflect critically on subjects that would create a vulnerability to the system and the atmoshpere of democracy that have been built about a decade.

Recommendations Reflective

First, the Secrets Bill should be placed in destination countries and the interests of national security as the main frame. This is expected not to create a closure regime is trying to shut down all access to information within the community. The implication is clear who will then be arranged in chapters, verses, and the grain on this draft will always be limited and only on the security interests nationally. 

Secondly, that is associated with a breakdown by category or scope set forth in this draft where when details are needed then the implication is clear, that such details do not cause mulit-interpretation that would lead to a sharp debate between state actors and civil society.

The third recommendation, which is related to the mechanism (how) to determine the secrecy. When the bill was needed in risk management (risk control), then clearly the details of how a way to determine the necessity of secrecy in the description ditampilan State Secrets Bill. Reformulation of the mechanisms determining which then linked to the classification and declassification effort is important and should dipaparakan in this bill.

 Fourth, the use of the retention level is where this bill should be formulated on the retention period associated with this type of state secrets. And how it ends when the retention period has been completed and does not pose a threat to the integrity of the nation and state and sebulum time specified. This needs to set a quick look at the context of the threat of escalation and handling. It is also necessary to avoid the omission of an object that has no strategic value in the period of time.

The fifth recommendation, namely the determination of explicit, clear, and detailed description of state actors (government) to the organizers, determining, managing, and protecting objects dirahasikan. This can be done by showing directly with one or more state agencies that either the ministry or non-ministry with competence and instruments in the implementation of state secrets. Or can form a new committee or agency of the state apparatus diakomdasi the organizers, determining, managing, and protecting objects dirahasikan. Sixth, which is on the standard procedures required when state officials based on title and its interests require and have a concealed object. Not only through the "right to know", but the standard procedure is to be important for itemized and clarified bagiamana way or the governance and refers also to the impact and needs when there is alienation in the possession of an object that dirahasian.

Seventh, the sehaursnya are ideal and meet the principles of democracy, namely the active participation of society, the space for the public (civilian) to access and have become important objects dirahasikan for granted. This can be done by using a security clearance to become a bridge for people to access confidential objects. This right also to look at the impact and implications associated with the goals and interests of national security. The next recommendation, the eighth, which is related to the fulfillment of the budget on the implementation of state secrets. Fulfillment may be obtained through official sources and legally owned by the state. To that end, the recommendations require to provide a discussion on Implementation of the budget in state secrets.

Ninth, which is associated with a discussion of exceptions where the points of the object dirahasikan can fade or fall along with the cases, such as human rights and corruption inherent in efforts perahasian state. It becomes important to provide an exception clause of the efforts that are confronted with the principles of democracy. Tenth recommendation, which is on the layered control where in this bill only provides two-way has not been enough supervision, required supervision layered, like the executive (the president and ranks), legislative (special committee) and judicial (national police, prosecutors, the judiciary), which was added by KPK as in the spirit of anti-corruption watchdog, Komnas HAM (in violation of basic rights pencegahaan society), and independent institutions (civil society) for external control of the state perahasian.

Standing Point

In looking and reflect on a bill that rolled back the Prolegnas 2010-2014, there are two important points in the placement of positions in response to the draft. First, this design has become the essence of a risk control tool against the threat to the integrity of the nation (especially in the vulnerability to interference, which would damage the physical). This becomes important in the context of the purpose and the interests of national security. Secondly, but when the national security context does not meet the principles of democracy enshrined in the bill this secret (especially in the substance), then the tendency to return to the culture of secrecy (closure regime) and misappropriation of authority has a strong potential and high. To that end, when national security goals and interests as outlined in the State Secrecy Bill still has a substantive problem which allows for the fraud, then the resistance becomes an important effort to put forward.

Paper Presentation as Keynote Speaker at Forum with Indonesia Police and TNI, also Related Stakeholder 

Analysis of National Security Bill Proposal

Analysis of National Security Bill Proposal

By David Raja Marpaung S.IP M.Def

The urgency National Security  primarily driven by inter-agency coordination in the handling of the threat (armed forces, police, another stakeholder), the security risk threat that increasing recently, and also to answer the clarity  of authority and responsibilities of agencies in the gray area.

Nonetheless, one of the biggest challenges in Indonesia are often the main area of ​​responsibility is gray (gray areas) so as to bring the two attitudes. First , the two parties or institutions feel that an issue is part of its responsibilities. This affects the handling is not comprehensive due to the different forms of treatment against a threat. Second,  the two parties or even parties who have a slice of responsibility to a problem just ignore the necessity to overcome the threats because he felt that the threat was not part of the relevant institutions. This is one of the challenges of security management that not only suffered by the Police and TNI, and other security actors, but also experienced by many actors other government institutions. This is like trying bridged by the National Security Bill. 

There are two main things that need to be a concern in drafting the National Security Bill. The first is the National Security Bill should incorporate the principles of democracy and human rights. As a result of termuatnya both these principles, then it should include the National Security bill on transparency, accountability, and reporting.National Security Bill to be transparent and accountable in the sense that the community should know what is happening in organizing security in Indonesia. It deals with activities such as policy implementation of what is spent, what, where made, what purpose, how the process is, how much budget is used, and what the outcome. This is to cover up a secret mission that made the device or instrument of the state and intended to injure his own people and to avoid misuse or distortion of the use of the budget.Nevertheless, not necessarily all of which must be done at a time when executed. This is because related to the type of mission, and the need for speed in responding to threats. However, the important point is to open space to public accessibility terdahap an activity involving governance, in this case the implementation of national security, in a stage of time. So this can provide supervision by the assurance process. Then, it is important in the application of the principles of democracy and human rights to ensure a reporting mechanism, investigation, and recovery in a centralized agency that specialized security-related operation. This mechanism is to ensure that there is an institution devoted to the care of the problem of abuse of authority or the state in relation to or connection with the rights of citizens. Starting from receiving reports, conducting investigations and inquiries, until the administration's decision to, for example provision of recovery, or compensation if it is true there is a violation of the rights of citizens during the process of national security. And it is important to emphasize that the safety of the complainant to obtain a guarantee from the state.

The second thing to consider in drafting the National Security Bill which also emphasizes the importance of a mechanism that can ensure a process of reporting, investigation, and restoration of human rights or democratic principles is still a past trauma. The biggest clash in the process of drafting Kamnas resistance is related to society caused by trauma on the occurrence of many human rights violations and lack of clarity to the process of investigation into human rights violations. Trauma is probably not going to continue to haunt if the process of investigation into human rights violations that occurred throughout the history of New Order and the closest is the event in May 1998, and the assassination of human rights activist, Munir, can be solved and revealed. However, because it is the opposite happens, then the range of conversation, discourse, or discourse relating to national security and centralization of governmental authority and powers of the security sector terhdap will always be regarded with suspicion, however well a development of the national security system, or a bill National Security prepared.

Although some of the things that become the background preparation of the National Security Bill are the things that are experienced by the organizers of the government and state security actors, but there are some things that can be a misinterpretation when not straightened out.

First, the preparation of the National Security Bill that has a tendency to explore the many sectors and fields, prejudice and suspicion that there is a willingness to re-open the gap to the control of the state by the "security regime". Prejudice was raised when the approach used in any security threat is its militaristic approach. This concern is justified when it is associated with a past history where "the military regime" coloring almost all aspects or areas of government. And although the reforms have been floated and the historical record, the fear of re-mastering effort by an authoritarian state is still strong. This is because the absence of a complete settlement of past human rights violations and lack of seriousness towards the completion of various violations. So that a very large resistance created when there are many businesses that feared the government to restore the pre-reform conditions. So it is necessary, for example, that the approach used in the completion of a variety of potential threats is no longer a militaristic, but rather emphasize the role of relevant institutions in some respects the authority of the institution and the community involvement in the handling of the threat, especially in the handling of threats stages do not need armed forces. And also it is important to resolve various human rights violations in the past as a form of understanding of reform and the importance of democratic values ​​and human rights in Indonesia to walk. So when the National Security Bill is sought to be run and well received, the first phase to be completed is not on the substance of the bill, but the necessity of settlement of various things which the bill is acceptable, as the investigation into the events of human rights violations that occurred in Indonesia . So that the various debates relating to the National Security Bill before entering into the substance, must be completed prior various problems of the condition which the bill was made.

Second, the various problems inherent in the management practices in specific institutions that must be completed first.Especially relating to the capacity of each state institution as has been mandated. At this level, the capacity of each institution is maximized sectorally. It also includes the ability to coordinate inter-departmental working. Which path itself can be reached without going through legislation, such as limited only by the direction of the president. So not all the things listed and charged through the National Security Bill. Thus, the National Security Bill can be directed to things that are special and urgent, and applies when there is a determination of the state. So every institution can specify what specific things that need to be handled in coordination relating to national security. This is to eliminate the suspicion of the possibility of securitization of various things which declared a national security threat and consequently able to exert coercive state devices. Thus, the bill directed to the handling of national security threats that are urgent and can not be resolved in the normal institutions. Thus, rules of engagement or SOP can be prepared, not to address the threat of a general nature, but the threats that are specific and urgent.

Last, preparing a National Security bill which is intended to respond to various forms of threats that could harm the integrity of Indonesia is an important country. But even more important to consider the various political background, history, resources and the various contexts in which the bill was drawn up. Develop a National Security bill which might be expected to be able to provide the legal foundation for the establishment of settlement schemes or the creation of various forms of threats in the future, should not be a misnomer as the source of the threat. Fear appears to be a misuse of legal substances from the National Security bill would be good if resolved not only with the socialization of the importance of National Security Bill, the background needs, as well as an overview of substance. Rather, it must be clarified before a commitment to respect democratic values ​​and human rights through the completion of various actions that violate these principles along with the openness and accessibility of the implementation of security which has been running. So many parties can be assured that the National Security Bill is built on the basis of both principle and not just include them in the form of chapters to obtain approval and convince the various parties.

Paper Presentation at FGD with Indonesia Police and TNI, also Related Stakeholder 

Problem of Protecting Indonesian Migrant Labor

Problem of Protecting Indonesian Migrant Labor 

By David Raja Marpaung S.Ip M.Def

            Indonesia has a complex and fragmented labor market.  It has a low-wage economy with significant disparities between the wages paid to expatriates and high-skilled local professionals employed by multi-national corporations and agencies and those paid to civil servants and employees of  local companies. There are also considerable discrepancies between the wages of managerial staff and low level employees within companies.

            Economic reasons drive the majority of Indonesian labor migrants to migrate abroad, to improve\ the economic status of themselves and their families. High levels of unemployment and underemployment in Indonesia push many individuals to look for jobs outside their area of origin and many may decide to go abroad after hearing about the availability of jobs from recruitment agents and social networks and the higher salaries on offer abroad.

            According to the Ministry of Manpower and Transmigration in 2006 there were 2.7 million Indonesian citizens working legally abroad, these workers constitute approximately 2.8 percent of the Indonesian workforce. The majority of these labour migrants are women working in the domestic or service sectors. They are concentrated in Southeast and East Asia and the Middle East, in particular Malaysia, Singapore, Hong Kong SAR (Hong Kong Special Administrative Region), Taiwan Province of China, Saudi Arabia, Kuwait and the United Arab Emirates

            One of the main problems identified in the report is a lack of cooperation amongst government agencies in the implementation of Law No 39/2004. As Law No. 39/2004 does not explicitly state the responsibilities of each ministry or department throughout the migration process, confusion and power struggles within the Government of Indonesia have followed, especially between the Ministry of Manpower and Transmigration and the newly established National Authority for the Placement and Protection of Indonesian Overseas Workers (BNP2TKI). Regulations have now been put in place in an attempt to establish a division of jurisdiction between these two authorities, however, to date, these regulations have not had the intended effects.

            There are about 11.000 cases of violence was experienced by Indonesian migrant workers due to the weakness of government's protection. Malaysia and Middle East Countries were unfriendly countries for migrant workers from Indonesia[1].

Seven Problems of Indonesian Migrant Worker

            The examination by BPK and analysis by another expert found seven main issues of one of the largest foreign exchange contributors. The seven main issues that cause the ineffectiveness of Indonesian migrant worker placement and protection are[2]:
First, the recruitment has not yet been backed by valid and transparent processes. So the certainty, justice and protection for the workers are not guaranteed,
Second, the preparation of healthy and skilled workers has not been based on strict policy, integrated training and examination system, or periodic and consistent supervision.
Third, the procedural preparation of lawful worker has not been supported by integrated system, or good and consistent law enforcement.
Forth, the implementation of insurance for the workers has not yet given just, guaranteed and transparent protection.
Fifth, the data of the worker placement is not accurate, so it is not in accordance with the efforts of protection for the workers abroad.
Sixth, the handle and solution of troublesome migrant workers abroad are partial.
Seventh, the simultaneous evaluation into the data and information of migrant worker issues has not been carried out comprehensively.

Building Protection to Indonesian Migrant Labor

            There is a big disaster at this month to Indonesia, Indonesian government failed to give adequate diplomatic support to Ruyati binti Satubi, who was executed in Mecca this June for killing her employer’s wife with a machete. The Saudi interior ministry said Ruyati confessed to her crime and that the death sentence was upheld by the country’s Court of Cassation (court of appeal) and Supreme Court. The execution was the result of the government’s negligence and showed its lack of diplomatic clout. 

            Beside Ruyati, there about 200 migrants’ labor that potential get dead punishment abroad[3]. About 70 Percent labor related with drug cases and 20 percent of the crime of murder.

            According to these fact there are several policy that must be implemented by Indonesia government and another stakeholder related with Migrant Labor:

1.    Provide special legal protection to Indonesian migrant workers and establish special body temporarily to solve recent condition problem

2.    Establish  Special Commission to investigate the murder of Indonesian migrant workers and tortures committed by the employers of Indonesian migrant workers and placement agencies

3.    Ratify the International Convention on the Protection of the Rights of All Migrant Workers and the Members of their Families

4.    Establish a system and mechanism for the process of the placement of work that will guarantee the protection of migrant workers and the members of their families.

5.    Formulate a MoU in the placement of Indonesian Migrant Workers between Indonesia as the Country that sends Indonesian migrant workers and the Countries that hire Indonesian migrant workers to guarantee the protection of Migrant Workers and the Members of their Families.

           

---

[1] http://www.ejobz.com/DetailArticles.asp?offset=66&NewsSubject=11.000%20Indonesian%20Migrant%20Violance%20Cases

[2] http://en.vivanews.com/news/read/229075-bpk-finds-seven-issues-of-migrant-workers

[3] http://www.detiknews.com/read/2011/07/01/134831/1672593/10/sby-200-tki-terancam-hukuman-mati-20-persen-karena-kasus-pembunuhan?n990102mainnews

Discourse Analysis On Intelligence Bill

Discourse Analysis On Intelligence Bill
By David Raja Marpaung S.Ip M.Def

             Intelligence is an integral part of the national security system. In the context of national security as a function of the provision of public goods, intelligence became the first line in the national security system. This becomes important because the sustainability of the state cannot inevitable and depends on the capacity and ability to execute its national security functions in order to face various forms of threats are increasingly complex and multidimensional in the era of globalization. 

          To build an integrated national security system and institutionalized to ensure sustainability, the fulfillment of national security functions in an effective and accountable. Therefore, reforms in defense and security (security sector reforms) are challenges that must be faced by Indonesia as a nation are in a period of democratic transition. Thus, reforms in the state intelligence are the differential of the security sector reform today.
        Intelligence, in addition to military and police, are an essential instrument of implementation of the national security system. Intelligence, according to its place in the national security system, has a role to strengthen early warning systems, information management systems and strategic analysis system. Seeing a very vital role in national security, the urgency of the Law on State Intelligence becomes inevitable and the fundamental need for Indonesia to meet the strengthening of the national security system.

          Therefore, the Act should mention the crucial issue of intelligence reform, among other things, the intelligence community are also associated with differentiation and coordination of intelligence functions between intelligence bodies, the intelligence product that also intersect with state secrets and confidential intelligence, and intelligence activities are also associated with functions, duties and authority of the intelligence services, oversight of the intelligence community and accountability of intelligence services.
          On the other hand, security sector reform through which a country's transition to democracy implies the existence of cohesiveness between the principles of security, democracy and human rights. The third cohesion of this structure will provide a mode of realization of the improvement agenda of security sector, especially in incorporating the principles of democratic accountability within the framework of the national security system, including increasing the capacity of state intelligence agencies.
        Meanwhile, intelligence agencies have the institutional paradox characterization. On the one hand, they are mandated to be able to work effectively and professionally with certain inherent authority-to ensure the presence of national security, along with other things that surrounded him. Intelligence agencies are generally given the special authority that is highly diverse, ranging from the authority for intercepting communications, electronic information dismantle personal, intervening rights of a person's privacy, until the authority to inspect, arrest / detention.

          Under the condition of the intelligence agencies in Indonesia, and the ideal concepts of intelligence institutions, it can be said that Indonesia need the Law on State Intelligence for the future of Indonesia is very urgent. In particular the intelligence system and national security systems in general. The law is expected to be reinforcing the legitimacy of the existence of political intelligence services in Indonesia. 

        Moreover, the political regulation can strengthen the coordination and performance between bodies of intelligence, and, able to overcome the partial ego between them. However, it is important also worth noting that the national intelligence reform must also be running in the corridors of democracy, protection of human rights and the rule of law.
          In addition, the Law on State Intelligence should be able to guarantee the national intelligence reform relating to management attempts to introduce effective national intelligence system to support the creation of the intelligence services are professional, tough, and the order of a democratic political system. 

          It is important to note again that the national intelligence reform agenda in Indonesia consists of five terms,   first, the political formulation of regulations to regulate the intelligence agencies are expected to be professional and accountable 

          second, the establishment of coordination mechanisms between intelligence bodies ; third, setting authority between the intelligence services; fourth, the allocation of national resources to strengthen early warning systems, management information and strategic analysis, and the fifth, the adaptation of democratic values ​​and human rights principles and good governance within the intelligence community.

Hawala System a Financing Strategy of Global Terrorism

Hawala System a Financing Strategy of Global Terrorism

by Ir. Ade Muhammad, M.Han

Introduction
“For money is the oxygen of terrorism. Without the means to raise and move money around the world terrorists cannot function” ( Collin Powell, US. Secretary of State)[1].

On May 1st 2011, secret operation named Operation Neptune Spear of elite US Navy Seal Team VI (and some sources report also with Delta Force) has conducted to take the Geronimo or known as no 1 Terrorist Osama Bin Laden in Bilal Town, Abotabad, in Pakistan territory. this Operation were noted as a major success of Global War on Terror since 9/11. 

Even so, the Al Qaeda still exist and still having controlled of their financial resources network. 

The focuses of this paper are trying to study and analyze the financial strategy of terrorist in Southeast Asia.

Money, we all needs money including the terrorist groups to fund its organization as well their operation.  We are focusing the study of Al Qaeda correlating to Jemaah Islamiyah in Southeast Asia in funding aspect.

And this vital study are very imminent because the nature and the difficulties of tracking it. For instances, United States under Executive Order 13244 in January 2003, as of September 2003, only $136.7 million in Al Qaeda-linked assets had been frozen[2]. Meanwhile estimated “total transaction” in Al Qaeda network US$ 30,000,000 per year[3].

We trying coverage about system of funding, the correlation between hierarchy of the group with the spending, overall system of raising fund, the subsystem of the raising fund, the discipline of storing and flowing the funding, the conclusion and in the end our recommendation. We present this paper with graphics and will be presented also in graphic based presentation. We hope that makes us easier to comprehend this issue.

Why they need money ?

They need funding to run the organization and the operation or mission. The needs for money could be categorized in the cost pyramid.

The organizational cost are include to finance; (see figure 1) maintain cells/enlarge cells, maintain infrastructure, training & travel, build false identities & procure false documentation, settle the safe houses, provide job/salaries (social cost), support families / relatives of prisoners (shahids).

the operational cost include; planning, preparation of the operation (making bomb, IED etc) and the operation.

But there are other hypotheses, from the comprehensive understanding that the terror funding not only used in “the terror domain” but also used in the 3 overlap domain. The Political Domain, Education Domain (such as suspected rouged pesantren) and “Military Operation”Domain (Terror Ops). This hypothesis is known as “Integrated Teamwork of Islamic Fundamentalist” (see figure 2).[4]

The hierarchy of the group correlated with spending/asset

On the tip of the pyramid of terror has shown the great of “cost” and asset. Estimated by the CIA about US $ 30 million per year to sustain all its operation before 9/11[1].  The operation it self not contribute a lot’s of money, for instance for 9/11 “show” the cost of plan and conducting, only between US $ 400,000- 500,000 (see figure 3).

Meanwhile the cost needed related to lower hierarchy such as Jema’ah Islamiyah getting cheaper. Hambali the head of JI operation, known possessed about US $ 500,000 and JI in Indonesia received some Rp1.35 billion from Al Qaeda since 1996[2]. And to running the Bomb Bali the JI only require no more than US $ 50,000.[3]

The lower group who inspired by Al Qaeda, are lower than that. Even though there was no report so far on their action, but the scholar, intelligences community and the international strongly believe their exist. As matter of time and opportunity for the Al Qaeda wannabe to show their fangs.

The System of Raising Fund

Mainly there are 4 entry point for the raising fund into the islamic terrorist group (see figure 4).

The sponsor. The state such as Iran, Syria, Sudan, North Korea or used to be Libya[1]. In the middle east, many organization got their funding from country through out the history. From Black September, Fatah to present HAMAS and Hezbollah had been received huge amount of fund from these sponsor countries. But now in the Southeast Asian case, this could be rare for Islamic Terrorist Group.   

The charity. This is correlated to Islamic tradition and law. Muslims are expected to donate 2.5 per cent of their net revenue to charity, known as zakat and the other charity from the member to the organization known as infaq.

 "In many communities, the zakat is often provided in cash to prominent, trusted community leaders or institutions, who then commingle and disperse the donated moneys to persons and charities they determine to be worthy." This practice is unregulated, unaudited, and thus leads to terrible abuse by groups such as Al Qaeda. There are some 300 private charities in Saudi Arabia alone, including 20 established by Saudi intelligence to fund the Afghan Mujiheddin that send upwards of US$6 billion a year to Islamic causes abroad. It is estimated that US$1.6 million per day is donated by wealthy Saudis alone. The four most important Saudi charities are the Islamic International Relief Organization (IIRO), which is part of the Muslim World League, a fully Saudi state-funded organization whose assets were frozen by the U.S. Treasury; the Al Haramain Islamic Foundation, also based in Saudi Arabia; Medical Emergency Relief Charity (MERC); and the World Assembly of Muslim Youth. The President of the World Assembly of Muslim Youth is Sheikh Saleh al-Sheikh, the Saudi Minister of Islamic Affairs. More disturbing, a Canadian intelligence report concluded that Saudi charities alone were funnelling between US$1--2 million annually to Al Qaeda's coffers[2]. 

The contribution. Specially, in the case of Middle East in the era before ‘90, the fund used to be received by the various company contribution (company not own by them, based on the symphaty for the cause). But now it is very difficult for one legitimate company to openly contribute the terrorist organization. But the contribution by individual remain active under zakat and infaq system. In Indonesian case of JI related to the religious conflict of Ambon, the contribution from Chinesse company were successfully collected through their fund raising campaign (Chinesse community in Indonesia, fear Radical Islam groups)[3], in various big city in Indonesia. Eventhough not clear about the amount they managed to collect.

The business. There are two ways, legal or illegal business. For legal business, not only expected to become the legal “cash engine”, but also to be able to purchase material needed for the organization and their operation. The good example of that company start by Konsojaya. Established in 1994, was a trading company that ostensibly exported Malaysian palm oil to Afghanistan and imported honey from Sudan and Yemen. The firm was capitalized with 100,000 ringgit, and 5,998 of its 6,000 shares were controlled by Wali Khan Amin Shah and Medhat Abdul Salam Shabana. Konsojaya’s original board of directors also included Hambali and his wife, Noralwizah Lee Binti Abdullah (a subsequent five-member board did not include Hambali or his wife). The company played an important role in Ramzi Yousef and Khalid Sheikh Mohammed’s Oplan Bojinka as a front for moving money and purchasing chemicals and equipment for bomb-making. Ramzi Yousef and Wali Khan Amin  Shah established another shell company, the Bermuda Trading Company, in 1994 as a cover to import chemicals for bomb-making. Then also Infocus Technology was established in July 1995, also by Yazid Sufaat. The company was partially owned by his wife. Infocus Technology hired Zacarias Moussaoui, alleged to be the 20^th September 11 hijacker, as a marketing consultant and was able to get him a visa to the United States. Infocus was to have paid Moussaoui a lump sum of $35,000 and a monthly stipend of $2,500 to cover his flight training in the United States. Sufaat has told Malaysian investigators that the money was never actually paid, but there is no evidence that this is the case.

Another front company was Secure Valley, established in October 1996. Little is known about the purpose or operations of this general trading company, but it had many of the same boards of directors as the other three JI-linked firms.

In addition to these, there were several other JI-linked front companies. Zulkifli (Zulkepli) Marzuki, according to Canadian intelligence, owned a security company in Kuala Lumpur called MNZ Associates (sometimes referred to as MNZ Management Services) in which many key meetings took place.104 Zulkifli co-owned MNZ with Mohamad Nasir Ismail, who was arrested in January 2002 under Malaysia’s Internal Security Act. Marzuki was a trained accountant, and MNZ Associates did the auditing for most JI/Al Qaeda front companies in Malaysia, including Infocus Technology and Green Laboratory Medicine. (MNZ Associates changed hands in January 2003 and is now named Wan Ali Jaafar Associates.) [4].

The illegal business of Islamic Terrorist Group including ; Opium farm in the Opium Belt at Afghanistan,  correlated with arm trading and smugglings (Narco-Terrorism), Hawala System (Informal Value Transfer System/ Alternative Remittance System) and  Internet Scams.

Works of Hawala System: basically an underground banking system and personal couriers (carrying cash, gold, or gems) to transfer funds across borders almost without trace. Like the principle if we transfer money through Money Gram to for instances our friend in US. We give our money to Money Gram Indonesia, then Money Gram US will pay our friend with their money first. Later on MG US will charge MG Indonesia with bill, and MG Indonesia will settle the payment through payment. The differences is in the Hawala system all payment made in cash through money man or courier. Other modus operandi is for using the fake transaction. In the diagram shown very clearly about this modus operandi[5].

The advantage of Hawala system are :

·                     Faster and cheaper than conventional banking system.

·                     Function at all level of money laundering – placement, layering and integration.

·                     No need to open bank account – no paper trail

·                     Serves remote location in Asia

·                     Reliable and secure – receipts usually no names.

That’s the basic system and to operate to transfer fund they follow the next procedure.

In the figure 6. Hawala System – Under pricing shown that, if Al Qaeda in Afganistan would like to send the money to JI network in Indonesia let say US$ 100,000.

1. Al Qaeda give the money to Hawalar in Pakistan US$ 100,000
2. Hawalar Pakistan will purchase a saleable goods such as Computer, valued US$ 150,000
3. After purchased, Hawalar Pakistan will export this Computer to Indonesia with the Declared invoice US$ 50,000
4. Hawalar Indonesia will received this Computer package and sells it for normal price US $ 150,000

after that Hawalar Indonesia split the Money, first give Indonesian JI US$ 100,000 and then send back “payment” to Pakistan of US$ 50,000.

Then the figure 7. Hawala System – overvoicing is if the situation other wise. If the JI would like to send Al Qaeda money, let say US $ 100,000 but the Hawalar Pakistan still need to export to Indonesia (to maintain the consistency of cover business).

1. First JI give Hawalar Indonesia the money US $ 100,000.
2. Then Hawalar Indonesia request to Hawalar Pakistan to import “Computer” to Indonesia. Hawalar Pakistan will purchase Computer in the value of US$ 50,000
3. Then Computer will be shipped to Indonesia and Declared invoice of US$ 150,000
4. Hawala Indonesia receives the Computer and sells it for US$ 50,000. then send the money US$ 150,000 to Hawala Pakistan.

After received the money, Hawala split the money, US$ 50,000 as their original money and US$ 100,000 to Al Qaeda.

Fund discipline of the terrorist group

Basically they used two method first using money laundry techniques and second they always flow by cash. To hide from the authority’s detection in the financial system.

Money Laundry and Reverse Money Laundry. When they got the profit from the illegal business sources such as opium or smuggling, they have to make that money innocent in the eyes of financial system. They have to laundry that “dirty money” to become “clean money”.

The techniques of laundry money start from the placement to the fund manager. Then the fund manager will do the layering process (example : store money in the bank and borrow the money from the bank, and do it again the process or playing in the stock market with several different names etc) after the layering process, then the integration. To integrate the money that already has been clean by the process. Then the money in that new place are the clean money ready to use. This could be done in the opposite way.

Flow by cash not transfer. According to regional intelligence officials, that year, the JI received Rp250 million, Rp400 million in 1997 and Rp700 million in 2000 (roughly US$40,000 and US$70,000 respectively). Omar al-Faruq testified to transferring US$200,000 to the JI's Indonesian cell after 2000.

Sheik Abu Abdullah al-Emarati, an alias of Osama bin Laden, was also involved in funding JI operations. He purportedly gave US$74,000 to Omar al-Faruq to purchase three tons of explosives for JI operations. The Bali attack likewise was funded by US$35,000 transferred by Wan Min Wan Mat, believed to be an important JI treasurer in Malaysia, to Mukhlas and Imam Samudra, the leading perpetrators in the Bali bombings.
A Jordanian man, Hadi Yousef al-Ghoul was arrested in his home west of Manila, Philippines, on 27 December 2001. Police officials contended that "Al-Ghoul is a member of one of the terrorist cells in the Philippines assigned to carry out a string of bombings in Metro Manila", but more importantly, he was seen as a mid-level Al Qaeda money man, who provided cash to locally-based Jemaah Islamiya operatives to whom he was believed to be financially supporting.

Mohammed Mansour Jabarah, a Canadian-Kuwaiti Al Qaeda operative, was dispatched to Southeast Asia in 2001 with some US$10,000 in seed money provided by Khalid Sheikh Mohammed, Al Qaeda's chief of operations. To conduct operations against U.S. targets in Singapore and Manila, Jabarah was given US$30,000 in three US$10,000 instalments in November 2001 from a man he identified as Al Qaeda's main money man in Malaysia. Jabarah was the primary conduit for Al Qaeda funds to Fathur Rohman al-Ghozi, the head of JI operations in the Philippines, who was responsible for purchasing TNT for operations in Manila and Singapore. When Jabarah left Singapore for Kuala Lumpur and later Thailand when he was on the run, the Canadian Security and Intelligence Service interrogation report states that he relied on infusions of cash from Al Qaeda operatives based in the region.

Conclusion of the analysis

This task could be the hardest part in Counterterrorism. Because the logistic and money supply still flowing until now, with few little success to freeze those money. So far it is very difficult to detect and most likely impossible to shut down.

This black funding phenomenon grows very good in the corrupt country such as Indonesia. Another challenge also in the weak linkage between the interagency network in Indonesia (not integrated) and other agency in Southeast Asia. 

Recomendation

“The sun is the best disinfectant” (Winston Churchill)

“Unity makes us strong, disintegrate makes us weak” (Indonesian credo on United in Difference).

Those two philosophies would be the best answer available to this critical phenomenon.

We need more transparency; every thing in “black” and “dark” area should be open to public. Any suspicious action will be emerged easily with the transparency principle.

Counterterrorism would need integrated work, strong interagency coordination from the intelligence unit to the custom. The close relationship between states in Southeast Asia would be the best manner to deal with this clear and present danger.

Only with two principles, the threat would be likely detect earlier and easier to counter or maybe if we lucky enough, to launch preemptive-strike against the network of terror. 

---

[1] State Sponsor of Terrorism, US Departement of State, released by the office of the Coordinator for Counterterrorism, April 26^th 2006

[2] Funding terrorism in Southeast Asia: the financial network of Al Qaeda and Jemaah Islamiya. http://goliath.ecnext.com/coms2/gi_0199-3159694/Funding-terrorism-in-Southeast-Asia.html

[3] Personal communication, Ade Muhammad by the various source of Indonesian Chinesse businessmen 2005.

[4] Pg 36, VOLUME 14, NUMBER 5, December 2003, NBR Analysis Funding Terrorism in Southeast Asia: The Financial Network of Al Qaeda and Jemaah Islamiyah Zachary Abuza

[5] Pg.19, 20 Terrorism and its Financial Background, Cranfield University, Tom Maley

---

[1] Pg 7, Source : 9/11 Comission Report, Terrorism and its Financial Background, Cranfield University, Tom Maley

[2] According to Malaysian and Singaporean intelligence reports, Funding terrorism in Southeast Asia: the financial network of Al Qaeda and Jemaah Islamiya. http://goliath.ecnext.com/coms2/gi_0199-3159694/Funding-terrorism-in-Southeast-Asia.html

[3] Pg. 4, VOLUME 14, NUMBER 5, December 2003, NBR Analysis Funding Terrorism in Southeast Asia: The Financial Network of Al Qaeda and Jemaah Islamiyah Zachary Abuza

---

[1] Terrorism and its Financial Background, Cranfield University, Tom Maley

[2] VOLUME 14, NUMBER 5, December 2003, NBR Analysis Funding Terrorism in Southeast Asia: The Financial Network of Al Qaeda and Jemaah Islamiyah Zachary Abuza

[3] Terrorism and its Financial Background, Cranfield University, Tom Maley

[4] Hendarmin Ranadireksa, Gema Pesan Bangsa, Bandung, 2007 – Hypothesis on discussion on Forum Rektor