Today, we are increasingly aware of the importance of the existence of Financial Services Institutions (“LJK”) to our society. This is because various aspects of people's lives currently rely on the services from LJK, ranging from banks, insurance, financial institutions, pension funds, pawnshops, and many others.

However, in carrying out its day-to-day business, LJK cannot escape the risk of criminal acts of money laundering, terrorism financing, as well as corruption, collusion, and nepotism (“TPPU, TPPT, and KKN"). Oftentimes, LJK becomes involved due to the perpetrators of such criminal acts using the LJK as a means to send, receive, and/or store wealth that comes from the criminal acts. In fact, LJK is considered to be the main supply in the chain of criminal acts of corruption handled by the Corruption Eradication Commission (Komisi Pemberantasan Korupsi or “KPK”) and its involvement can have fatal consequences in the loss of public trust.¹

Considering that TPPU, TPPT, and KKN are complex criminal acts and can have a major impact on the community, the government regulates them strictly through a series of laws and regulations. The state authorities also seem to be competing in drafting the laws and regulations or guidelines in relation to Anti-Money Laundering, Prevention of Terrorism Financing, and Anti-Corruption, Collusion, and Nepotism (Anti Pencucian Uang, Pencegahan Pendanaan Terorisme, and Anti Korupsi, Kolusi, dan Nepotisme or “APU PPT and Anti-KKN"). Some of the authorities involved including the Financial Services Authority (Otoritas Jasa Keuangan), the Financial Transaction Reports and Analysis Centre (Pusat Pelaporan dan Analisis Transaksi Keuangan), the Bank Indonesia, and the KPK. This of course has resulted in the existence of so many laws and regulations regarding the APU PPT and Anti-KKN which must be complied with.

The next difficulty arises because such laws and regulations that have been stipulated are often amended and/or revoked which puts the community at risk of implementing any provisions that are no longer valid and/or not knowing that there are any new provisions to be implemented. Therefore, LJK has its own challenges to identify, understand, and implement these laws and regulations and all of their amendments.

Furthermore, the risk of criminal acts of money laundering, terrorism funding, as well as corruption, collusion and nepotism in LJK may be incurred by any divisions that do not have any legal background. Even today, many persons or entities are considered to have difficulties in comprehending the boundaries of corruption criminal acts.²  For example, Article 12C of Law Number 31 of 1999 on Eradication of Corruption Crimes as amended by Law Number 20 of 2001 on Amendments to Law Number 31 of 1999 on Eradication of Corruption Crimes (“Corruption Law”) stipulates that a civil servant or state administrator can be freed from any criminal offence of gratification if the beneficiary reports the gratification to the KPK. If such report is not provided, as regulated in Article 12B paragraph (2) of the Corruption Law, the beneficiary may be subject to criminal sanctions in the form of life imprisonment or imprisonment for a minimum of 4 (four) years and a maximum of 20 (twenty) years and a minimum fine of IDR200,000,000.00 (two hundred million rupiah) and a maximum fine of IDR1,000,000,000.00 (one billion rupiah).

If the employee of an LJK is not provided with sufficient information, the relevant personnel may not know that he/she has received a prohibited gratification and/or does not know that if he/she receives the gratification, the relevant personnel must report it to the KPK. This of course is a very big risk and it pose the next challenge for LJK because the misunderstanding, ignorance, and/or misinterpretation of employees towards the laws and regulations regarding the APU, PPT and Anti-KKN can cause various risks for LJK, ranging from reputational, financial, compliance, to legal risks.

In response to the aforementioned concerns raised by LJK, Hukumonline comes with a Regulatory Compliance System (“RCS”) which shall make it easier for LJK to avoid TPPU, TPPT and KKN. Equipped with Hukumonline regulation database which have access to more than 150,000 (one hundred and fifty thousand) laws and regulations, the RCS can help LJK in identifying various obligations quickly and efficiently to avoid various risks, especially legal and non-compliance risks. By using an Artificial Intelligence and presenting curated results from law scholars, RCS is able to package these obligations by paying attention to user comfort and convenience so that the content is easy to understand even for any parties without any legal background. Therefore, RCS is able to mitigate the non-compliance and legal risks so that LJK can focus more on running their business.

Take a firsthand look at the benefits that you will be able to enjoy through the RCS by experiencing a free demo of our new Regulatory Compliance System here.

[1] Mochamad Januar Rizki. “Menyoroti Risiko Tipikor Pada Industri Jasa Keuangan”. Hukumonline. https://www.hukumonline.com/berita/a/menyoroti-risiko-tipikor-pada-industri-jasa-keuangan-lt61497 fc0d6607/?page=2. Access date September 20, 2022.

[2] Ibid.