Evolving Fraud Modes

Financial fraud and fraudulent investments still continue to haunt society. The mode changes with the development of digital technology. Get to know the various modes so you can avoid the trap.

The following article was translated using both Microsoft Azure Open AI and Google Translation AI. The original article can be found in Modus Penipuan yang Terus Berkembang

HUMAS POLRES METRO JAKARTA BARAT

The West Jakarta Metropolitan Police displayed evidence seized from a fraudulent investment case involving medical equipment claiming to be from the National Disaster Management Agency (BNPB), in Jakarta on Wednesday (8/6/2022).

Andreas Agung (31) almost became a digital financial crime victim. In mid-June 2023, in the middle of a meeting with his colleagues, the private employee in the automotive sector received an incoming message on his cell phone. The message was sent from an unknown number. The sender includes a link.

Due to boredom from a meeting and curiosity, Andreas immediately pressed the link. Suddenly, his phone automatically downloaded an application. Since then, he felt that something was not right.

"I am worried they want to take data from my phone. I immediately cancelled and forcefully turned off my phone," said Andreas when met in Tangerang Selatan, Banten, on Sunday (8/6/2023)."

Andreas is relieved, the mysterious application has failed to install. Because, after the .apk format application file is installed on the cellphone, the application will ask for access to retrieve personal data, such as photos, videos, SMS, and access its digital banking account .

Also read: Societal Losses due to Illegal Investment Reach IDR 112.2 Trillion

"If only the application had been installed perfectly, criminals could access Andreas' digital banking service and drain all of its contents. 'Almost fell victim to a crime,' he said."

In a webinar entitled "Beware of New Style Fraud Modes" organized by the Financial Services Authority, Thursday (3/8/2023), Head of the Department of Consumer Protection OJK Rudy Agus P Raharjo explained, the mode of crime and financial fraud continues to grow as communication technology and digitalization evolve.

The newest mode of financial crime that has recently been troubling the public is social engineering-sniffing. This is a mode of crime that is carried out to manipulate the victim into obeying the perpetrator. The trick, the perpetrator gives a lure that touches the victim's emotions, whether it's curiosity, joy, or fear so that the victim falls into a trap.

Executive Vice President of the Digital Center of BCA Wani Sabu said, based on data from Oxford University, 88 percent of banking cases in the digital era originate from social engineering modes. As for Indonesia, the figure is even greater, namely 99 percent.

Apart from that, illegal investment scams are still rife with the lure of large returns and the use of digital technology. The scams range from binary options trading (binary options), robot trading, and illegal crypto asset trading.

Also read: Recognizing the Characteristics of a Fraudulent Investment

Education

OJK's Chief Executive for the Supervision of Financial Services, Education and Consumer Protection, Friderica Widyasari Dewi, explained that one of the reasons for the continued prevalence of financial fraud and false investment is the low level of public financial literacy.

KOMPAS/WAWAN H PRABOWO

Banners inviting you to be aware of illegal online loan (pinjol) practices adorn the entrance to Muara Angke Market, Penjaringan, North Jakarta, Sunday (14/11/2021). Currently, there have been at least 19,700 complaints of illegal loans to the Financial Services Authority.

Quoting the National Survey on Literacy and Financial Inclusion 2022, financial literacy of Indonesian society is at a level of 49.68 percent, up from 38.03 percent in 2019. This means that only 49.68 percent of the Indonesian population is financially literate, or is consciously and fully aware of the workings, mechanisms, risks, and legal aspects of a financial service.

To avoid fraud, consumers must remember the concept of 2L before deciding to invest. "These 2L are legality and logic," said Friderica.

According to him, make sure the legality of the company or entity, whether it is already officially registered with OJK. If there is no related entity name on the OJK website, it can be ensured that it is a scam.

In addition, make sure that the offered value is logical. Offers that promise excessively large profits may be tempting, but they are not logical. This is a scammer's way of tricking consumers.

Also read: False Investment Cases Continue to Happen, Financial Literacy Needs to be Improved

ERIKA KURNIA

The North Jakarta Metro Police released the case of an illegal online (online) loan company at the North Jakarta Metro Police Headquarters, Monday (31/1/2022). Three workers at a company operating in the PIK area, Penjaringan, North Jakarta, have been named as suspects.

Not only prevention through education, but eradication efforts also continue to be carried out. The eradication of illegal financial activities is strengthened by the presence of Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector. In this Law, it is explicitly prohibited to collect funds from the public, manage them, and redistribute them to the public without the permission of the Financial Services Authority (OJK).

Based on data from the Task Force for the Eradication of Illegal Financial Activities, from 2017 to 2022, community losses due to the presence of illegal investment entities are estimated at IDR 137.84 trillion.

Meanwhile, from the enforcement aspect, from 2017 to 31 July 2023, the task force has suspended the operations of 6,894 illegal financial entities consisting of 1,193 illegal investment entities, 5,450 illegal online lending entities, and 251 illegal pawning entities.