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A deeper look into Investment Management in Indonesia

Updated: Sep 15

By: Michael Demetrius

In recent times, the Financial Services Authority’s Investment Alert Task Force (“OJK’s Task Force”) issued an instruction for PT Jouska Finansial Indonesia (“Jouska ID”), who claims to be an independent financial advisor, as well as its affiliations, PT Amarta Investa Indonesia (AII) and PT Mahesa Strategis Indonesia (MSI), to cease operations over allegations of illegal stock brokerage and fund mismanagement. The cessation was decided following complaints made by its clients on social media, which led OJK’s Task Force to find that said companies do not hold the proper investment licenses.

Former clients and a number of current clients uploaded their portfolio revealing Jouska ID’s mismanagement of their funds. It later came to light that Jouska ID had invested the majority of the investor funds in a newly listed computer hardware-trading company, being PT Sentral Mitra Informatika, trading on the Indonesia’s Stock Exchange (IDX) under the code LUCK, causing their client’s investment value to plummet by more than 70% (seventy percent).

Moreover, a former client complained and even uploaded an offering letter and a contract he received from Jouska ID, which expressed that not only that Jouska ID would educate and assist the client in selecting the right investment instrument based on their profile, but also gave Jouska ID the right to manage the clients’ funds, as well as to buy and sell stocks on their behalf. Below are some of the regulation violations that may be charged against Jouska ID:


Lack of Investment Management Licenses

According to Article 1(11) of Law 8 of 1995 on Capital Market (“Law 8/1995”), an investment manager is defined as a person other than an insurance company, pension fund or bank with respect to its own lawful activities, that, as a business, manages securities portfolios or collective investment portfolios for clients or groups of clients. Further, Article 30(2) Law 8/1995 and Article 2(1) of OJK Regulation No. 10/POJK.04/2018 on the Implementation on the Governance of Investment Manager (“POJK 10/2018”) mandates that any person or entity that carries out business activities as an investment manager must firstly obtain a business license as an Investment Manager issued by OJK.

In the present case, Jouska ID did not only provide financial advice to its clients as it previously claimed, but it also managed its clients’ funds. The International Association of Registered Financial Consultants (IARFC) Indonesia also stressed that a financial advisor is prohibited from managing clients’ funds and trading stocks in their portfolios even with full discretion and consent from the clients. Such actions can only be carried out by a licensed Investment Manager.


In spite of the above, the OJK’s Task Force revealed that Jouska ID is only registered and licensed as an education-service company through the Online Single Submission (OSS). Such absence of the required license, approval or registration is subject to imprisonment for a maximum of 5 (five) years and/or a maximum fine of Rp5.000.000.000,00 (five billion Rupiah).

Fraudulent Act

Furthermore, not only did Jouska ID conduct activities as an Investment Manager without the proper licenses, their fraudulent claims and actions have also led the clients to experience severely great losses. Referring to Article 378 of the Indonesian Criminal Code, any person who with intent to unlawfully benefit himself or another, either by assuming a false name or a false capacity, or by crafty artifices, or by a web of fictions, induces someone to deliver any property or to negotiate a loan or to annul a debt, shall, being guilty of fraud, be punished by a maximum imprisonment of four years. Additionally, in relation to consumer losses in electronic transactions, as further regulated in Article 28 paragraph (1) and Article 45A paragraph (1) of Law No. 11 of 2008 as amended by Law No. 19 of 2016 on Electronic Information and Transactions (“EIT Law”), any person who knowingly and without authority disseminates false and misleading information resulting consumer loss in Electronic Transactions is subject to imprisonment for a maximum of 6 (six) years and/or a maximum fine of Rp1.000.000.000 (one billion Rupiah).

Consumer Protection

Aside from the above, Jouska ID has also failed to comply with provisions contained in the Law No. 8 of 1999 on Consumer Protection (“Law 8/1999”), as it failed to guarantee the security in protecting their clients. According to Article 7 letter (a) and letter (b) of Law 8/1999, entrepreneurs shall act in good faith in conducting the business activities and to provide correct, clear end honest information with regard to the condition and warranty of the goods and/or services and provide an explanation on the use, repair and maintenance. For such violation, Jouska ID is punishable by a maximum of 5 (five) years and/or a maximum fine of Rp2.000.000.000,00 (two billion Rupiah).


In light of the above, having licensed as an education-service company, Jouska ID does not have the authority to manage its clients’ funds, as well as to buy and sell stocks on their behalf, even with full discretion and consent from the clients. It should have firstly obtained all proper licenses to conduct its investment management and advisory activities as required by OJK.


LID Advisory is a publication prepared by Launcher.id. It is intended to inform in general topics covered only, and should not be treated as a legal advice or relied upon when making business activities or investment decisions. Should you have any inquiries on the matters contained in LID Advisory, or other comments generally, please contact us at contact@launcher.id.



All content presented herein is for informational purposes only. Nothing should be construed as legal advice. Transmission and receipt of this information is not intended to create and does not constitute, an attorney-client relationship with PT Sinergi Konsultasi Indonesia. There is no expectation of attorney-client privilege or confidentiality of anything you may communicate to us in this forum. Do not act upon any information presented without seeking professional counsel.

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