Losses from Illegal Investments in Indonesia Reach Rp117 Trillion

The Indonesian public has suffered losses totaling Rp117.4 trillion (approximately US$7.8 billion) due to illegal investments over the past decade. The peak losses occurred in 2011, reaching Rp68.62 trillion (approximately US$4.6 billion). This figure subsequently decreased by 88.4% to Rp7.92 trillion (approximately US$0.5 billion) in 2012. The Financial Services Authority (OJK) attributes this decline to the efforts of the Investment Watch Task Force (Satgas Waspada Investasi).

Since the establishment of the Task Force, losses from illegal investments during the 2012-2021 period have generally decreased.

According to the OJK, illegal investment cases are spread across almost all regions of Indonesia, with the highest number of cases occurring on Java Island.

The OJK has handled 1,053 illegal investment entities in the last five years. In 2017, 79 illegal investment entities were handled. This number increased to 106 in 2018 and 442 in 2019. In 2020, the number decreased to 347 entities, and to 79 in 2021.

According to OJK records, the characteristics of illegal investments are as follows:

1. Promising unreasonably high returns in a short period.
2. Offering bonuses for recruiting new members.
3. Utilizing community/religious/public figures to attract investment interest.
4. Claiming to be risk-free.
5. Unclear legality, such as lacking a business license, possessing an institutional license but lacking a business license, or engaging in activities that do not align with the possessed business license.

The OJK also notes two main factors contributing to illegal investment cases.

*First*, from the perpetrator's perspective: Technological advancements make it easy for perpetrators to create applications, websites, and offers through social media. They can also conduct digital promotions from foreign servers, making them difficult to track.

*Second*, from the public's perspective: Many people lack investment knowledge, making them susceptible to offers of high-return investments.