THE EXISTENCE OF SHARIA SUPERVISORY BOARD IN MAINTAINING THE PURPOSE OF SHARIA PRINCIPLES IN SHARIA BANKING

National banking Activities are operationally carried out implementing both conventional and sharia principles. One important distinction between banking using conventional principles and Islamic principles is the existence of Sharia Supervisory Board (hereinafter is called DPS/Dewan Pengawas Syariah) in the institutional structure of sharia banking. Organizationally, DPS supervises sharia banking services as an effort of maintaining sharia principles. On the other hand, in the organizational structure of sharia banking (Limited Liability Company) there is commissioner as an organ of Limited Liability Company in addition to the General Meeting of Shareholders (GMS) and board of directors who perform the function of oversight. Besides, sharia banking are externally also supervised by Bank Indonesia as the central bank and FSA as an institution of the financial services authority. This paper is intended to determine the existence of DPS in maintaining the purity of sharia principles in sharia banking and the accountability of DPS in sharia banking institutions. Based on normative study, the existence of Sharia Supervisory Board in the operations of sharia banking is crucial in determining the implementation or failure of Islamic principles that have been set through the fatwa of National Sharia Council, among others by conducting operational analysis of sharia banking and undertaking an assessment of the activities and products of the bank. Ultimately, Sharia Supervisory Board can provide internal controls to ensure that sharia banking operations have been compliant with the fatwa issued by the National Sharia Council. In addition, the organizational accountability of the Sharia Supervisory Board on the implementation of supervisory tasks of sharia banking is reporting the results of monitoring of the implementation of sharia compliance of sharia banking to Bank Indonesia and reporting the results of sharia supervision at least every 6 months to the National Sharia Council-Indonesian Ulama Council.