The increasing complexity of operations in Indonesia's financial institutions (Lembaga Jasa Keuangan, or LJK) has amplified their exposure to fraud risks. To mitigate these risks, the Otoritas Jasa Keuangan (OJK) has introduced Regulation Number 12 of 2024, focusing on the Implementation of Anti-Fraud Strategies for Financial Institutions (POJK SAF LJK). This regulation is crucial in addressing the significant financial losses caused by fraud, which affect not only the industry but also the government and society.

Fraud can encompass various actions, including corruption, asset misappropriation, financial statement manipulation, deception, and unauthorized information disclosure. The POJK aims to unify the approach to fraud prevention across all sectors of LJKs, including banking, insurance, and financing companies. This comprehensive framework replaces earlier regulations and ensures that all institutions adopt standardized anti-fraud measures.

Under the POJK, LJKs must develop and implement a robust anti-fraud strategy built on four key pillars:

Prevention: Establishing proactive measures to deter fraudulent activities.

Detection: Implementing systems to identify potential fraud promptly.

Investigation and Reporting: ensuring that any incidents of fraud are thoroughly investigated and reported.

Monitoring and Evaluation: Continuously assessing the effectiveness of fraud prevention strategies.

Additionally, LJKs are required to create a dedicated unit for managing anti-fraud initiatives, tailored to their operational complexities. This unit will oversee compliance with the regulation and respond to any fraud incidents. LJKs must also implement a fraud detection system and enhance understanding among internal and external stakeholders regarding fraud risks.

The regulation emphasizes the importance of reporting; LJKs must submit detailed reports to the OJK, including their anti-fraud strategies, corrective actions, and any significant fraud events. These reports must be comprehensive, accurate, and timely to ensure transparency and accountability within the financial sector.

Effective from October 31, 2024, this regulation underscores the OJK's commitment to fostering a safer financial environment in Indonesia, where institutions are better equipped to prevent and respond to fraud.