Combatting Online Fraud

RECENTLY, the modus operandi of digital crimes (online) has become increasingly concerning, causing significant material and immaterial losses and psychological trauma for victims.

The forms are varied, ranging from investments promising fantastic returns, false job offers, fictitious stores, impersonating bank officials, to romantic relationships leading to investment fraud. 

Data from the Financial Services Authority (OJK) reveals a worrying scale of the issue. Since its inception in November 2024 up until July 31, 2026, the Indonesia Anti-Scam Centre (IASC) has received 637,055 reports.

As many as 1,179,881 accounts have been reported and verified, with 607,210 accounts blocked.

The funds related to successfully blocked scams amount to 724.1 billion rupiah, while 204.3 billion rupiah has been returned to victims.

What needs to be done to eliminate online fraud?

Online Crime Industry

Online fraud is no longer just a matter of individuals being deceived via phone or social media.

This crime has evolved into a transnational industry that trades in trust, exploits personal data, and drains people's savings within minutes.

By the time a victim realizes their money is gone, the perpetrator may have already transferred it through multiple layered accounts. This highlights the fundamental issue of law enforcement in Indonesia.

The data from OJK must be read carefully. Reports do not necessarily equate to unique victims, and accounts do not equate to the number of perpetrators.

However, the magnitude of these numbers indicates that fraud has created an ecosystem involving fake identities, money laundering accounts, psychological manipulation, and mass message distribution.

The recorded losses may not even cover all victims who do not report the crimes.

Online fraud operates by transforming technology into a machine that extorts trust. The modus operandi varies, including investments promising huge returns, fake job offers, fictitious stores, impersonation as bank officials, and romantic relationships leading to investment fraud.

Studies on the pig butchering scam in Indonesia illustrate how perpetrators build emotional closeness before draining victims' money through fake investment platforms.

Impact of Online Fraud

The impact goes beyond just losing money. Victims can get trapped in debt, lose education and retirement funds, experience psychological pressure, and even lose trust in digital transactions.

Worse still, some fraud operations in Southeast Asia are supported by human trafficking and forced labor.

Victims of fake recruitment can be forced to scam others in fraud centers.

They simultaneously become victims of exploitation, and in certain situations, risk being treated as perpetrators.

Indonesia actually has no shortage of legal instruments. Law Number 1 of 2024 concerning the Second Amendment to the Law on Electronic Information and Transactions regulates the dissemination of false or misleading information that harms consumers in electronic transactions, with a maximum prison sentence of six years and a fine of up to 1 billion rupiah.

The Personal Data Protection Law and the Anti-Trafficking in Persons Law are also relevant when crimes involve data theft, exploitation, or coercion.

However, problems and challenges in law enforcement in Indonesia face several complex issues that have yet to be addressed, such as forensic capacity, inter-agency coordination, perpetrator anonymity, and transnational networks.

Agenda to Combat Online Fraud

Therefore, Indonesia's first agenda must be to accelerate the recovery of funds, not just to increase reports. Banks, payment providers, police, OJK, and digital platforms need to have a joint response protocol that operates around the clock.

Verified reports must trigger immediate investigations into the flow of funds, the suspension of transactions in accordance with legal authority, and the blocking of related accounts. Any remaining funds should be prioritized for return to victims.

Second, law enforcement must pursue networks, not just stop at account holders. Authorities need to trace controllers, recruiters, infrastructure providers, and the flow of profits.

Collaboration with other countries is essential when perpetrators, servers, victims, and accounts are located across different jurisdictions.

Account holders who intentionally facilitate crimes must be carefully distinguished from those whose accounts are misused.

Third, digital platforms should not only measure success by the number of accounts deleted.

Multinational company Meta, for example, may shut down millions of accounts, but a more meaningful measurement is the reduction in victims, fraudulent ads, and stolen funds.

The government needs to promote transparency, rapid response to reports, and accountability from platforms that fail to meet their legal obligations.

Lastly, victim protection should be an integral part of the criminal process. Easy reporting, assistance, fund recovery, and restitution need to be strengthened.

Digital literacy is important, but it should not be a subtle way to blame victims.

While it may seem impossible to eradicate all risks associated with technology leading to crimes in the digital space, law enforcement must ensure that the speed of money transfers does not always outpace the speed at which the law operates.

Success in combating online fraud should not be measured by the number of perpetrators announced as captured, but rather by how many crimes are prevented, money is saved, and victims are rehabilitated.