Indonesia’s digital financial ecosystem is expanding rapidly, but regulatory scrutiny has struggled to keep pace with the growing influence of social media personalities who provide investment commentary to millions of followers.
This governance gap was sharply exposed in February 2026, when the Financial Services Authority (OJK) imposed a landmark 5.35 billion rupiah fine on a financial influencer identified as BVN for manipulating stock prices and disseminating misleading information through social media platforms.
Investigators found that the influencer used multiple securities accounts to pump and dump shares of at least three listed companies, posting promotional recommendations while executing counter-directional trades and profiting from followers’ reactions.
The conduct was found to violate Articles 90, 91 and 92 of Law No. 4 of 2023 on the Development and Strengthening of the Financial Sector, which prohibit market manipulation and deceptive practices in the capital market. This episode underscores how unchecked social media influence can distort markets and undermine investor protection.
The problem extends beyond isolated misconduct. Across social media platforms, influencers routinely promote cryptocurrency tokens, speculative stocks and alternative investment schemes, often framing their content as financial education while monetizing engagement through advertising, affiliate links or undisclosed commercial arrangements.
Retail investors, many of them first-time participants in capital markets, may struggle to distinguish between independent analysis and paid persuasion. In volatile markets, such narratives can amplify herd behavior and exacerbate losses.
Without clear regulatory classification, enforcement agencies face difficulty determining when online commentary crosses the threshold into regulated advisory activity.
Indonesia’s legal framework for financial advisory services remains anchored in Law No. 8 of 1995 on Capital Markets and implementing regulations issued by the OJK. Licensed investment advisors must satisfy competency standards, ethical obligations and fit-and-proper requirements.
These safeguards exist because financial advice directly influences capital allocation and public trust. However, the framework was designed for conventional advisory firms, not a decentralized digital ecosystem where influence is algorithm-driven and monetized through visibility.
The core legal question is substantive rather than formal. If a person provides investment recommendations that influence market behavior and receives economic benefit directly or indirectly, should that activity fall within the scope of regulated advisory services?
If regulatory responsibility depends solely on formal titles, digital actors can operate in a gray zone while licensed professionals bear disproportionate compliance burdens. Such asymmetry undermines fairness and weakens investor protection. The OJK has authority to clarify this boundary through interpretive guidance or regulatory refinement.
Law often trails behind technological innovation and social change, resulting in delayed and fragmented regulation. Proactive measures — such as predictive frameworks and comparative studies — are essential to govern emerging innovations, particularly in the financial sector.
The OJK has adopted a regulatory sandbox approach, allowing new business models to be tested in controlled conditions before general regulations apply, helping authorities assess potential risks before full-scale implementation.
Under POJK 3 of 2024, which replaces POJK 13 of 2018, digital financial business models, processes and products can undergo limited testing prior to obtaining full licensing. The challenge lies in striking the right balance between oversight and innovation.
The sandbox framework should extend beyond business models to include influencers and other entities functionally tied to financial innovation. Such an approach is critical to prevent individuals from exploiting regulatory gaps for personal gain at the expense of retail investors.
While criminal provisions exist to address violations, preventive and administrative regulations are equally vital, ensuring that punitive measures remain a last resort rather than the primary regulatory response.
Comparative jurisdictions offer useful guidance. In the United Kingdom, the Financial Conduct Authority requires authorization for regulated investment advice and has warned that unauthorized financial promotion on social media may constitute a criminal offense.
In the United States, the Securities and Exchange Commission and the Financial Industry Regulatory Authority enforce registration requirements and fiduciary duties under the Investment Advisers Act. Enforcement increasingly targets unregistered crypto promoters and influencers who fail to disclose paid endorsements. The principle is consistent: the substance of influence determines responsibility.
In China, financial advisors are overseen by the National Administration of Financial Regulation, established in 2023, while the China Securities Regulatory Commission continues to supervise securities and futures markets.
Regulations require firms and individuals to hold China Securities Regulatory Commission licenses, a framework now extended to internet-based financial services. Authorities have introduced rules to address risks linked to online platforms, covering cross-border service provision, internet information management, and activities such as client profiling, asset allocation and trade execution.
Indonesia stands at a regulatory crossroads. Digital participation in the capital market is expanding rapidly, particularly among younger demographics. Encouraging financial inclusion is commendable.
Yet inclusion without adequate safeguards can generate volatility and erode trust. The objective is not to criminalize online discussion, but to ensure that those who materially shape investment behavior meet proportionate standards of competence, transparency and accountability.
A credible reform agenda should therefore begin with definitional clarity. The OJK must articulate when digital financial commentary becomes regulated advisory activity. Disclosure obligations should apply to monetized investment content.
Coordination between financial regulators and digital platforms should be institutionalized to address cross-sector risk. Ultimately, trust is the foundation of the capital market — and trust cannot thrive in regulatory ambiguity.
Ahmad Novindri Aji Sukma is a regulatory compliance lawyer based in London and a PhD researcher at the University of Cambridge. Randy Taufik is a legal counsel and University of Oxford alumnus specializing in corporate and technology law.
