14-5-2024 (JAKARTA) A staggering 2.7 million Indonesians have fallen prey to the vice of online gambling, fueling a massive 327 trillion rupiah (S$27.6 billion) circulation of funds in 2023. Alarmed by this burgeoning crisis, the Indonesian government has declared an all-out war, characterizing the industry as a nefarious “scam” that must be eradicated.
The Ministry of Communications and Informatics (Kominfo) has taken a decisive stance, taking down a staggering 800,000 gambling websites in the latter half of 2023 alone – a number equal to the total number of sites removed in the previous five years combined. However, this digital whack-a-mole approach has proven futile, as new gambling sites continue to emerge with relentless frequency, their computer servers strategically located overseas, beyond the government’s reach in countries like the Philippines and Cambodia.
Budi Arie Setiadi, the communications and information minister, conveyed the gravity of the situation in a text message to The Straits Times on May 13. “Nobody could win by betting their money against a machine that is designed to always be in profit. We are doing public campaigns to convey this message,” he asserted, underscoring the government’s determination to raise awareness about the inherent risks of online gambling.
In a bid to stem the tide, the Indonesian government is now seeking assistance from Interpol and is keen to engage with authorities in neighboring ASEAN countries to facilitate the shutdown of these online platforms.
Exacerbating the crisis is the alarming trend of gamblers falling into debt traps, fueled by the ease of obtaining high-interest loans from popular online lending platforms, known locally as pinjol, which typically approve loans within minutes.
The government estimates that a staggering 78 percent of the 2.7 million online gamblers, drawn from Indonesia’s total population of 280 million, are young people, many aged between 17 and 20 and hailing from low-income families.
Under Indonesian law, gambling is a criminal offense punishable by up to six years in prison and a fine of up to one billion rupiah. However, the government recognizes the need for a multifaceted approach, combining legal measures with educational campaigns to dissuade people from falling victim to this insidious vice.
Officials are determined to shatter the illusion perpetuated by online gambling platforms, which use sophisticated algorithms to lure players with initial wins, only to drain their resources once they become addicted. The message is clear: once ensnared, many find themselves unable to break free until their financial resources are depleted, leaving them indebted and destitute.
The cautionary tale of Mr. Nofrianto, a 32-year-old resident of Lampung province in Sumatra, serves as a harrowing example. In an interview with Jakarta-based news portal Okezone.com in October 2023, the father of two, who works in the oil and gas industry, recounted how online gambling cost him his house and two cars.
“At first, I only wanted to try it out with 1.5 million rupiah and managed to win a total of 31 million rupiah. This was the start of me getting trapped,” Nofrianto, who goes by one name, confessed. Continuously topping up his gambling account in a futile attempt to recoup his losses, he found himself spiraling deeper into financial ruin.
In late April, Kominfo’s director-general for public information, Usman Kasong, underscored President Joko Widodo’s commitment to resolving this gambling crisis, with various ministries and agencies mobilized to combat the online menace that has reached alarming levels.
“Kominfo cannot take down (websites operating from) servers located overseas, while the OJK (Financial Services Authority) cannot block accounts with banks overseas,” Usman said, emphasizing the need for government-to-government cooperation to overcome these jurisdictional limitations.
The OJK, however, has the authority to order banks to suspend or block accounts implicated in criminal activities. In the last three months of 2023 alone, it ordered private banks to block 4,000 accounts suspected of being used for online gambling.
Under the government’s plan, Indonesia’s Financial Transaction Reports and Analysis Centre (PPATK) will trace the money trail of everyone implicated in the online gambling scourge, while the police will conduct investigations and make arrests.
Major private banks, including Bank Central Asia, the country’s largest lender by value of savings accounts, and Bank Jago, the largest digital bank, have pledged their support in this crackdown.
“We never facilitate online gambling in any form and will block any account used for online gambling based on the existing regulations,” stated Hera F. Haryn, a Bank Central Asia spokeswoman.
Echoing this sentiment, Bank Jago CEO Arief Harris Tandjung acknowledged the gravity of the issue, saying, “Online gambling is a concern faced not only by the regulator but also by the banking industry.”
“Accounts with unusual behavior, such as those that had thousands of transfers a month, would go into our screening. We regularly monitor and request explanation when transactions get suspicious,” Arief explained. “We will block the account as soon as possible if it is found to be linked to online gambling.”
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