Moving in the right direction to fight financial crime: prevention and detection
| Published date | 08 May 2018 |
| Date | 08 May 2018 |
| Pages | 362-368 |
| DOI | https://doi.org/10.1108/JFC-06-2017-0060 |
| Author | Fitriya Fauzi,Kenneth Szulczyk,Abdul Basyith |
| Subject Matter | Accounting & Finance,Financial risk/company failure,Financial crime |
Moving in the right direction to
fight financial crime: prevention
and detection
Fitriya Fauzi
Universitas Bina Darma, Indonesia
Kenneth Szulczyk
Department of Finance and Banking,
Curtin University Malaysia, Miri, Malaysia, and
Abdul Basyith
Universitas Bina Darma, Indonesia
Abstract
Purpose –The purpose of this paper is to identify currentmeasures taken for financial crime’s prevention
and detectionin the context of Indonesia.
Design/methodology/approach –This study is based on data from articles in Indonesian newspapers
relating to the current financial crimes, current measures of preventing financial crimes in Indonesia and
based on the literaturereview.
Findings –There are someattempts to combat financial crimes in Indonesia,both internally and externally.
The attempts that havebeen made for the internal scope are the enactment of anti-money launderinglaw, the
new monitoring system of financial institutions and the formation of a superintendent institution. The
attempts that have been made for the external scope are the agreement between Indonesia’financial
intelligenceunit Pusat Pelaporan dan Analisis Transaksi Keuangan(PPATK), and other countries’sfinancial
intelligence unit, the affiliation member of the Asia/Pacific Group on Money Laundering (APG) to combat
financialcrimes through strengthening its anti-money laundering and terror financingcapabilities.
Originality/value –This paper presents an overviewof current prevention and detection measures in the
context of Indonesia, and it is hoped that this paper will contribute to the current discussion of eliminating
financialcrimes.
Keywords Indonesia, Detection, Financial crime, Prevention
Paper type General review
1. Introduction
Indonesia breeds many forms of financial crimes. The country, comprising many islands,
has a weak financial system and governance, with lax legislation and regulation, is a cash-
based economy and has a weak rule of law and weak law enforcement institutions (Bureau
of Public Affairs, 2013). Alas, these crimes undermine the financial health and stability of
the economy. Gottschalk (2010) categorizes financial crime as corruption, fraud, theft and
manipulation. The US Department of Treasury defines money laundering as that “makes
illegally-gained proceeds appears legal.”Typically, it involves three steps: placement,
layering and integration. First, perpetrators secretly deposit ill-gotten funds into the legal
financial system. Subsequently, the perpetrators transfer the money between numerous
accounts. Finally, laundered funds appear clean after many transfers (USA Department of
Treasury, 2018).
JFC
25,2
362
Journalof Financial Crime
Vol.25 No. 2, 2018
pp. 362-368
© Emerald Publishing Limited
1359-0790
DOI 10.1108/JFC-06-2017-0060
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1359-0790.htm
To continue reading
Request your trial