Corruption Eradication Commission deputy chairman Mohammad Jasin said investigators had found "indications of violations" of forestry rules by 470 companies, mainly miners, operating in Indonesian Borneo.

Deforestation and rampant illegal logging is the main reason Indonesia is the world's third-biggest emitter of greenhouse gas emissions, blamed for man-made global warming.

"They misused forest permits, chopped down trees for wood without replanting, destroyed forests for mining activities and avoided tax payments, among other breaches," Jasin said.

"These violations cost the state more than 1,000 trillion rupiah (110 billion dollars)," he added.

Corruption "permeates every level" of the forestry sector, he said.

"Those with power take advantage of the weak forestry regulations and local government officials who are supposed to supervise the forests take bribes from plantation companies," he said.

"It's hard to catch corruptors because supervision costs a lot of money. The forests are vast and we need helicopters and expensive equipment to check illegal practices on the ground."

Forestry ministry official Masyhud said a "big percentage" of companies granted permits to use forest resources had broken laws designed to limit damage to the environment and protect endangered species.

"Many of these permits were issued by local governments, not the ministry. The permit holders illegally cleared land for plantation and mining activities and carried out illegal logging," he said.

A report by a coalition including the BlueGreen Alliance and the Rainforest Action Network released in the United States this month found that 40 to 55 percent of Indonesia's timber is illegally harvested.

It warned that 98 percent of the archipelago's lowland forests could be gone by 2022.

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