A senior Indonesian police source has told ABC News that they have arrested a Sri Lankan man called Akram.
The man, who is also known as Rosen, was arrested in Bogor, south of Jakarta, and police suspect he organised a boat which sank off Cidaun on the south-west coast of Java in July.
There were more than 210 people on board, and 189 people survived.
Police have also completed their case against another people-smuggling boss called Jawed Muhmud, or Bilu, who is thought to be linked to four boats, including one which sank in June last year killing about 100 people.
Meanwhile a Lieutenant commander of the Trincomalee Navy Camp and four foreign agents have been arrested by the Matara Police today over their alleged involvement in a large-scale human smuggling racket.
A senior advisor to the Australian Federal Police (AFP), Christopher Wood, responsible for conducting the investigations regarding the scam visited the Matara Police to see the suspects.
Police said the Australian Police officer was involved in investigations in Bangladesh and the Maldives as well.
The officer who was apparently serving in a boat belonging to the Navy, was asked to appear at the Special Investigation Unit of the Matara Police for questioning, where he was arrested, police said.
So far, 22 suspects have been arrested in connection with the racket and amongst them there are three sailors.
According to the police, the suspects have demanded a down payment of Rs 200,000 from prospective illegal migrants from Trincomalee and Jaffna and on the day they board the boat to Australia, each person had to pay Rs 800,000 to the smugglers.
ඉන්දුනේසියාවේදී ශ්රී ලාංකික සංග්රාමිකයන් අත්තඩංගුවට…..
ඉන්දුනේසියාවේදී ශ්රී ලාංකික සංග්රාමිකයන් අත්තඩංගුවට පත්වී තිබේ. සංග්රාමිකයන් 106 දෙනෙකු අත්තඩංගුවට පත්වී ඇති බවත් එහිදී ශ්රී ලාංකිකයන්ද සිටින බවද වාර්තාවේ. ඉන්දුනේසියාවෙහි නැගෙනහිර ජාවා හරහා ඔස්ට්රෙලියාවෙහි ක්රිස්මස් දූපතට යෑමට ශ්රී ලාංකිකයන් 7 දෙනෙකු උත්සහකර ඇතයි පැවැසේ. බෝට්ටු මඟින් ඔස්ට්රෙලියාවට යෑමට තැත් කිරීමේදී ඔවුන් අත්තඩංගුවට පත්වී තිබේ. අත්තඩංගුවට පත්වූ සංග්රාමිකයන් 106 දෙනාවම රඳවුම් කඳවුරකට යවා තිබේ. ශ්රී ලංකාව, සෝමාලියාව, සූඩානය, ඉරාකය, ඉරානය, මියන්මාරය, හා යෙමන් යන රටවල්හි පුද්ගලයන් මෙලෙස නීතිවිරෝධි ලෙස ඔස්ට්රෙලියාවට යෑමට තැත්කර තිබේ.