When social media influencers Indra Kesuma and Doni Salmanan appeared on an Indonesian television program. To show off their wealth in January, the studio audience laughed and applauded hearing about their “flexing”.
In Indonesia, both men are known as ‘crazy rich’ Indonesians, a title given to wealthy young people. Who flaunt their possessions on social media.
Mr Kesuma, who goes by Indra Kenz, admitted to once buying an electric car for more than 1.9 billion rupiah ($180,000). He could not sleep, and stumping up $30,000 for a T-shirt, which he considered “very cheap”.
Mr Salmanan said he earned $3 million per month, and once gave $100,000 to an online gamer, just because he was bored.
Meanwhile, one of their alleged victims, Maru Nazara, watched on from home.
“I was very angry, but at the same time worried,” Mr Nazara said.
Victims file complaint to police
Mr Nazara was one of thousands of Indonesians who started binary options trading on a self-described “investment platform” app, called Binomo after watching Mr Kesuma’s YouTube videos.
He said he was convinced to give it a go after seeing what appeared to be Mr Kesuma, 25, making tens of millions of rupiahs in just minutes.
“I thought it must be the real deal,” he said.
“[Mr Kesuma’s] results [were] confirmed and validated by his social media posts with the luxury goods,” he alleges.
Binary options are financial products that are an all-or-nothing, usually short-term, bet on the movement of a stock.
They are described by the Australian government’s Moneysmart site as “a high risk, unpredictable investment that is really just a gamble”.
According to its website, the Binomo app is owned by a company based in St Vincent and the Grenadines, in the Caribbean, and available in more than 130 countries.
Mr Kesuma was a “mentor” for the app, and Mr Nazara signed up using his affiliate code.
Later, in his report to police, Mr Nazara said he noticed repeated irregularities, like the app freezing when he won, or his bid value automatically clicking five times. In six months, Mr Nazara alleges he lost around $50,000 and was left in debt to his relatives. “I felt ill due to stress and fell into depression for three months because I lost all my capital,” he said.
Mr Nazara, together with other users, decided to file a complaint to police.
Police say ‘flexing’ used to lure investors
In February, just a month after appearing on the television show, Mr Kesuma became the first binary options trading affiliate to be arrested by the Indonesian National Police.
He is facing multiple charges related to fraudulent activity on Binomo including online gambling. Sreading false news, fraud and money laundering.
The police allege Mr Kesuma’s confiscated assets amounted to $5.7 million. They were targeting hundreds of billions more rupiah in several of his bank accounts.
Doni Salmanan, the man who sat next to Mr Kesuma on the show, has also been arrested. Promoting another binary options app, Quotex.
Cybercrime and Criminal Investigation director Brigadier General Asep Edi Suheri alleged at a police press conference. That Mr Salmanan, 23, broke the law by fraudulently publishing YouTube videos claiming he had earned billions of rupiah from Quotex and “flexing” to convince people to use the app.
“In reality, DS [Doni Salmanan] does not trade on the website and is only an affiliate to benefit from the members,” Brigadier General Suheri alleged recently at a press conference, where Mr Salmanan’s confiscated assets were displayed.
The police claimed they confiscated $50 million from his frozen bank accounts, and nearly $5 million in luxury goods.
They said they were continuing to investigate others who were allegedly misrepresenting where. They obtained their wealth on social media to promote binary options platforms.
Cyber Crimes Division head Reinhard Hutagaol alleges the mentors received about 80 per cent. The money lost by the users who signed on with the mentor’s affiliate codes.
He alleged at a press conference that there were at least 25,000 active members in a Telegram group. For Quotex users affiliated with Mr Salmanan.
A Telegram group for Mr Kesuma’s Binomo users had more than 200,000 members.
In response to the alleged fraud, the daughter of one of Indonesia’s richest men, Grace Tahir.
Ms Tahir’s father, Dato Sri Tahir, and his family are listed as the seventh richest people in Indonesia. And occupy the position of 961 on a list of the richest people in the world, according to Forbes.
Ms Tahir told the ABC the point of the parody skit was to raise awareness with the Indonesian public. About the risks of social media posts about how to make money quickly.
“Everyone can post anything on social media, so the audience has to be careful,” she said.
University of Indonesia media and communication academic Whisnu Triwibowo said. The digital literacy of the Indonesian people was still low and more government intervention was needed.
“Even in Europe where the digital literacy is already high, they have internet laws,” Dr Triwibowo said.
Lawyer Finsensius Mendrofa, who is acting on behalf Mr Kesuma and Mr Salmanan’s alleged victims. Said he still had hundreds more complaints to verify and pass on to Indonesian police.
The police say they are now looking at charging 13 more affiliates in addition to Mr Kesuma and Mr Salmanan.