Alleged Deception Causes Trauma

KOMPAS/HERU SRI KUMORO

Suspects and evidence of online fraud cases were revealed by the Directorate of Cyber Crime at the National Police\'s Criminal and Investigation Agency at the National Police Headquarters, Jakarta, Wednesday (7/8/2019). The international syndicate managed to get around Rp. 113 billion from the victim.

Have you ever received an offer for a loan from an illegal financial technology (fintech) company? This seemingly attractive offer could turn into a nightmare if the borrower fails to return the funds according to the terms of the agreement.

And not just the borrower, but even their friends whose numbers are in the borrower’s cell phone can also become the targets of intimidation from the illegal fintech company.

Villy, a 24-year-old man from Semarang, Central Java, was derided on messages sent to his mobile phone, and was accused of cheating.

I did not know at that time, I knew nothing about OTPs

It all began in October 2019 when Villy, who was looking for a job, received an email from someone who claimed to be a human resources staffer at a company. That person told Villy that he had passed the selection test, and asked him to come to Jakarta to take additional tests.

Villy did not think it odd when he was also asked to open an account with an online fintech company and deposit Rp 500,000 (US$34). He was told the company would transfer money to his account to cover his accommodation.

Also read: Financial Inclusion Spurs Economy

He also did not think it strange when the same person called him later to ask for Villy’s username, password and one-time password (OTP), claiming that the data was needed to transfer the money.

However, shortly after he sent the requested information, Villy found out that he could no longer access his account. Whoever the person was, they had changed his mobile phone number, email address and password.

"I did not know at that time, I knew nothing about OTPs," he said last week.

KOMPAS/ADITYA DIVERANTA

The police confiscated a number of evidence of cellphone sim cards and employee identity cards from an illegal fintech company in Penjaringan, North Jakarta, Monday (23/12/2019).

A week later, Villy received a rude phone call from a stranger who accused him of being a cheater for not delivering the baby products he was allegedly selling. Villy was received similarly rude phone calls from 10 different people, all of whom accused him of cheating them. Some threatened to report him to the police for fraud.

Villy realized that the original email correspondent was a fraudster who had used his account to open a fake online store. He reported the incident to the police.

When the police asked him to close the account and open a checking account, Villy realized that the account that had been set up using his name had been used to a launder fraudulently gained money of nearly Rp 100 million in transaction value.

The point is, don’t be hasty, don\'t be careless.

It is now almost a year since the incident, but this bad experience still haunts Villy\'s mind. His name was spread on social media and reported to complaint centers for online crimes in association with the fraudulent account.

"The point is, don’t be hasty, don\'t be careless. Stay alert, even though you might feel happy like I was when I thought I had landed a job. I really don\'t understand banking. Yes, it\'s my fault,” he said.

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Because of his experience, Villy now avoids all fintech products. He is still disinclined to look into, let alone try, digital financial platforms offering convenience and practicality, especially in the middle of the Covid-19 health crisis.

Kompas/Priyombodo

Two children try the game at the launch of the agile internet program (#tangkasberinternet) at the Ministry of Education and Culture in Jakarta, Monday (10/2/2020). This activity was initiated by Google Indonesia in commemoration of the safe world internet day or "Safe Internet Day" which is held annually on 11 February.

Digital financial platforms

Fraud is difficult to prevent and manage in the fintech realm. Tita Mantovani, who managed a joint research project by the Center for Digital Society (CfDS) and the Gadjah Mada University Social and Political Sciences School, said that using fintech required two skills, namely digital literacy and financial literacy.

People must really understand the financial and economic steps involved in becoming a fintech customer. In terms of digital literacy, they must know how to use applications, as well as understand that they must provide their personal data to the fintech service provider.

According to Tita, a wide gap still existed between the government’s public awareness campaign for digital technology and general understanding among the public. For example, not everyone was aware that a list of legal fintech companies licensed by the Financial Services Authority (OJK) was available. In fact, people who urgently needed money were at risk of becoming easy targets for illegal fintech companies.

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"Issues about illegal fintech [companies] and personal data protection may be followed only by certain people," she said.

Tita expressed appreciation for the government’s literacy program. Another possibility, she suggested, was to include digital and financial literacy in the official curriculum.

Indonesia is promoting financial inclusion through Presidential Decree No. 82/2016 on National Strategy for Financial Inclusion. Financial inclusion is measured by three indicators: access, use, and liquidity.

The OJK’s surveys in 2013, 2016 and 2019 showed that financial inclusion in the country had increased from 59.74 percent to 67.8 percent, and then to 76.19 percent, while Indonesia’s financial literacy index increased from 21.84 percent in 2013 to 29.7 percent in 2016, and then to 38.03 percent in 2019.

ARSIP KOMPAS

The news that revealed Illegal Tekfin appeared on the front page of KOMPAS 17 June 2019.

However, financial literacy, which can be defined as an individual’s understanding of financial services and products, still remains below 50 percent. This indicates that customers that use financial services and products do not fully understand these products and services.

Tita expressed hope that the industry would continue to play a role in educating the public. This was important, because if a customer had a bad experience with fintech, it would eventually damage the image of fintech companies and the industry as a whole, even if their experience was not caused by a systemic flaw.

Vice President for Corporate Communications Denny Abidin of mobile network operator Telkomsel made assurances that the company would delete and block subscribers that used the short message service (SMS) for fraud or other criminal activities. In implementing the preventive measure, Telkomsel had installed SMS firewalls and blocked SIM boxes, a device that allows the use of multiple SIM cards from different providers.

Group Head of Corporate Communications Tri Wahyuningsih of XL Axiata also highlighted the company\'s commitment to reduce the spread of spam messages and fraud that used SMS.

"XL Axiata has implemented an automatic blocking mechanism for numbers that have been [flagged] for sending large numbers of SMS messages in a short period of time," she said.

She also urged customers and the public to report to the police if they experienced any incidences of fraud through certain mobile numbers.