2 – Mohamed Suharto
Mohamed Suharto is one of the most corrupt heads of state ever to have walked the earth. This former president of Indonesia was so crooked, in 2004 he even topped an “all-time corruption league table” by Transparency International. He became president of Indonesia in March 1968 and over the next three decades, his “New Order” regime imposed a strong, centralized and military-dominated government. For most of his tenure, Indonesia experienced economic prosperity and industrialization, which improved living standards in Indonesia. Unfortunately, Suharto also used corruption to amass a staggering personal wealth from his office.
During his 31 years as effective ruler of Indonesia, Suharto acquired between $15 to $35 billion. A carefully organized system of handing control of state-run monopolies to friends and family members enabled Suharto to make tribute payments of millions which frequently masqueraded as charitable donations to foundations which Suharto oversaw. While these entities – known as “yayasans” – were ostensibly intended to assist in improving various public services, they served as nothing more than cash conduits for Suharto’s personal enrichment. He used his presidential power to make it a requirement that payments to these yayasans became a standard cost of operating in Indonesia. Banks and other financial institutions, for example, had to pay a portion of their annual profits to a yayasan while high net-worth Indonesians were also obliged to contribute “tithes” from their salaries.
Suharto’s venality didn’t stop there. To be able to take advantage of Indonesia’s vast natural resources, businesses were made to obtain the assistance of a Suharto associate to be able to overcome the significant red tape purposefully placed in their way. In exchange, equity in the enterprise had to be surrendered. For example, when the Indonesian capital Jakarta’s water system was privatized, twenty percent of the venture’s shares had to be paid to Suharto’s son Sigit. Suharto also used service firms to extract cash from larger companies. The Indonesian state oil company, Pertamina was made to import and export its oil through two Suharto family-owned companies, each levying a fee of 35 cents a barrel for the service. Suharto companies also benefited from very lucrative contracts with the oil giant. An audit of Pertamina in July 1999 revealed that $6.1 billion had been stolen in this way.
Suharto made only token gestures toward reducing corruption. In 1977, he claimed to back a program called “Operation Orderliness” which aimed to combat cronyism. In reality, it focused on only minor civil servants and so did very little to deal with the real and growing problem of corruption at the top of the Indonesian government. Suharto was also supposed to stand trial in 2000, accused of embezzling around $571 million from the above-mentioned yayasans. Conveniently, doctors ruled him too ill to face proceedings. He was swept from office when mass demonstrations against the Indonesian government broke into rioting in May 1998. He lost the military’s support and resigned from office on May 21st. After a period of ill health, Suharto died in January 2008.