For a few weeks, it was the talk of Indonesian social media. Binary option “influencers” Indra Kenz and Doni Salmanan had had their assets confiscated by the authorities.

Both were affiliated with Binomo, a binary options trading platform that had run into significant legal trouble for allegedly being closer to gambling than investment. The two influencers had been dubbed “crazy rich Indonesians”, a reference to the Hollywood film Crazy Rich Asians, which depicts a world of wealth and excess. 

According to the Financial Services Authority (OJK), the Indonesian public has lost Rp 117.5 trillion (US$8.3 billion) through investment products in the last 10 years.  

“We’re really hoping that we can get our money back,” said Maru Nazara, a victim of a predatory binary options scheme by Binomo. Maru lost Rp 500 million ($34,836.75) in 2021. 

“I thought it was real trading because the influencers showed how they traded and showed off their bank accounts. The quick profit seemed really lucrative,” he added. “I was brave enough to report the issue to the police, because there are a lot of other victims.”

Binary options trading is illegal in Indonesia, as authorities consider the system akin to gambling. Relying on the outcome of a "yes or no" proposition, traders profit if their choice is correct and lose if it is not. 

Lavish lifestyle

Ichal Muhammad, 30, is an influencer with 500,000 followers on Instagram. He became a Binomo affiliate in 2021. “I don’t remember the exact timeframe, but it was sometime in the first quarter of 2021. I became a binary options affiliate for 32 to 33 days,” he said.

Ichal said a friend who was an affiliate had introduced him to the investment platform.

“He told me that he was going to teach me about investment.” 

His friend’s apparent success intrigued him.

“If you look at the affiliates’ lifestyles, they have such a lavish way of life. And especially during the pandemic, who doesn’t want to have instant success? So I actually tried investing before I tried being an affiliate,” Ichal said. “I lost at least Rp 30 million [$2,090.97].”

'Crazy rich': Doni Salmanan, one of the Binary option 'influencers', often shows his wealth on the social media. (Instagram/donisalmanan.official) (Instagram/donisalmanan.official)

He then found a Binomo affiliate link. “You just have to sign up with your email, and you don't need to have knowledge about trading or any investment instrument,” he said.

As an affiliate, Ichal had to find clients by sharing referral codes on his social media accounts. Though his affiliate experience was quite short, he managed to get 23 clients.

Then, he said, he realized it was a scam. 

“One of my clients was a domestic worker. She lost about Rp 37 million [$ 2,579.42], and I just knew that I got 70 percent of my client’s loss as profit. So I knew it was not the right investment instrument.”

Not long after this discovery, he quit. One client even asked for their money back, and Ichal complied. 

Ichal was one of many who were lured into the scheme. Twenty-four-year-old Monica Christy, who is based in Manado, was an affiliate from September 2021 to January 2022. A friend introduced her to the Binomo platform, and she ended up losing Rp 100 million ($6,960.46). 

“After losing my money in the investment, I became tangled up in debt. That’s when I received an offer to become an affiliate. Personally, I had no knowledge about any investment instrument, and I did not know how to differentiate which one was a real investment and which one was a scam,” Monica said. 

Monica, too, had to find new clients each month. She tried to get her close friends and family to join the platform.

“At first, they asked me to find five people, but then I had to find more people to join the platform. The last time, they asked me to find 20 people,” she said.

She also promoted the platform on her YouTube channel. 

“I was convinced it was a scam right after the platform made a few headlines on the news,” she added. 

Ongoing case: The authorities confiscate an asset belongs to Indra Kesuma, known as Indra Kenz, a suspect of Binomo trading application case, at Perumahan Cemara Asri in Percut Sei Tuan, Deli Serdang, North Sumatera on March 10. (ANTARA FOTO/ Fransisco Carolio) (ANTARA FOTO/Fransisco Carolio)

Ilham, who owns a convenience store in Bali and asked to use a pseudonym for this article, lost Rp 500 million ($34,773.25) in the scheme between 2019 and 2020.

“Binomo detects members who have played for 45 minutes nonstop. Those players are made to lose their rounds,” he claimed. “If a player plays for Rp 1 to 2 million, the system is not going to play foul on them. However, players who start using big numbers – we are talking about hundreds of million – are going to be made to lose intentionally.”

Ilham said he had received this information from a friend who was also an affiliate. 

“Additionally, there is a thing called candle manipulation, where the graphs shown do not really illustrate the actual Binomo,” Ilham alleged. “This platform gets 70 percent profit from each loss. Quotex affiliates, however, get 80 percent profit from each loss.”

Influencers’ role 

Ichal said that in order to fight against the influencers promoting scam trading platforms, the country needed to have contrasting influencers who truly understood the market. 

“I myself found out more about the malicious investments across the country from the [National Police] and the Futures Exchange Supervisory Board [Bappebti]. They shared information about [the issue of] gambling under the guise of investment schemes. Therefore, it’s important to have more people who understand investment share their experiences," Ichal said. 

Other observers concurred that education and investor protection were key.

“Years ago, a masterclass for understanding the stock market could cost you up to Rp 5 million. These days, it only costs you Rp 1 to 1.5 million, or [sometimes] as little as Rp 200,000, ” said Prathama Nugraha, an entrepreneur based in Jakarta. 

Something's fishy: Ichal first started as a Binomo affiliate and was not aware that it is illegal in Indonesia. He later found out that he gained 70 percent profit from his client’s loss. (Personal Collection/Courtesy of Ichal Muhammad) (Private Collection/Courtesy of Ichal Muhammad)

“As more platforms become available, people should also be careful with the information that is spreading across the internet, especially those who have no experience with investment,” he continued.

In real investment, he said, risk – even high risk – was understood and managed. In investment scams, people had no control over the risks they faced. 

Despite some recent arrests, Ichal felt not enough had been done to ensure others did not get roped in.

“I think this is a serious issue that needs to be discussed. Doni Salmanan has been an affiliate for over three years, and his turnover is estimated at up to 1 billion rupiah,” Ichal said. “Can you imagine how many people out there will do similar things if we stay silent?”