According to the KPK’s Anticorruption Clearing House (ACCH), 64 percent of the 887 major corruption cases the KPK investigated from 2004-2018 involved bribery. An easy way to detect corruption is to look at the lifestyle of a suspect to see if he or she could be enjoying illegal proceeds.

For example, the Talaud regent, Sri Wahyumi Maria Manalip, was known for her love of expensive jewelry, branded bags, watches and other luxury items. According to the KPK, she once asked for a Hermes bag that no other female regent owned as a bribe.

Many corruption cases have shown that suspects have the problem of excessive consumerism. Many scholars argue that consumerism and corruption are intertwined, in that they mutually cause one another.

For example, some studies suggest that consumerism is a significant motive for corruption, and others insist that corruption fuels conspicuous consumption.

This practice constitutes multiple cultural and behavioral factors underlying an individual’s tendency to engage in corruption. In highly cohesive countries like Indonesia, many public officials strive to maintain their status according to what they perceive to be the norm in their communities, which includes matching their consumption patterns with those of fellow public officials.

Economist Thorstein Bunde Veblen says in The Theory of the Leisure Class that the class divisions that separate the rich from the poor have influenced the consumption patterns of the so-called leisure class.

Veblen argues that members of this class are driven to engage in conspicuous consumption wherein wealthy people purchase goods not for utility but rather to send messages to others about themselves (e.g. their wealth and status).

Some scholars call this behavior as signaling their personal value through goods. Some studies on corruption also suggest that, for corrupt public officials, demonstrating a lavish lifestyle also serves as a means to expand their networks with influential people, including other corrupt officials.

Interestingly, corrupt public officials also appear to use such lifestyles to subtly “advertise” their willingness to provide “special services” in exchange for money, goods or other benefits.

Many people accept consumerism as some form of spirituality associated with the “immaterial self and its possibility of being.”

Many believe that among the major causes of corruption is the desire of people in the lower classes to emulate the lifestyles of the higher classes through appearance and behavior. This problem is often exacerbated by aggressive advertisements that increase people’s appetites for luxury goods.

The advent of technology has made it easy for consumers around the globe to quickly access information on the latest luxury goods on the market. Social media provides an environment where the rich and famous can share their material lifestyles, including showing off their expensive possessions.

In the context of the fraud triangle model, these may constitute pressure to commit fraud, especially when an individual’s financial condition is inadequate to fulfill his or her desire for luxury goods.

Studies suggest that high consumption of luxury goods is often found in countries with a high prevalence of corruption. Transparency International’s 2017 report, “Tainted treasures: money laundering risks in luxury markets”, reveals that the luxury goods sector is often used to facilitate corrupt payments.

The report also highlights the high risk of money laundering in luxury goods subsectors (e.g. art and jewelry), and how the lack of monitoring by relevant authorities contributes to the prevalence of corruption.

The fact that consumerism has been identified as a root cause of corruption does not seem to help much in eradicating the crime. Since removing consumerism from the equation is not something that can be done easily, controlling it offers a more feasible solution.

For example, in connection with the possible use of the luxury goods sector for laundering corrupt money, several countries like India and China have enhanced monitoring and control of the luxury goods sector.

The government’s seriousness in mitigating the threats of money laundering and terrorism financing is evident in its issuance of several anti-money laundering (AML) regulations. Moreover, Indonesia underwent the Financial Action Task Force’s (FATF) Mutual Evaluations peer review in 2018 as a prerequisite for future membership.

The Mutual Evaluation Report of Indonesia was authorized in July 2018 at the Annual Meeting of the Asia/Pacific Group (APG) on Money Laundering in Kathmandu.

The report states that Indonesia has sufficient commitment and capabilities in preventing and eradicating of money laundering and terrorism financing as required by the FATF Recommendations.

However, future improvements must also include increasing and expanding AML monitoring to cover more sectors that have a high risk of money laundering, such as the luxury goods sector.

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The writer is the director of the Center for Forensic Accounting Studies at the Islamic University of Indonesia, Yogyakarta. He earned his master and doctorate in forensic accounting at the University of Wollongong in Australia.

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