Thread: A Very Sad, Sad Tale KKM

The likely reason it has not been mentioned is that these scams are all over Indonesia, and while illegal, many play them with full knowledge that at some point they'll go bust. But many know if they get out early enough they may get their promised returns that were som other poor sods principle. I forget the names of the larger ones, but they're out there and still active.

I must say, throwing a brick at the mayor's house hardly seems like a wise or justified action. Gambler beware - why not throw a brick at a random pedestrian while you're at it?

Troy F.

yes, we had the same game in the UK, people buying houses and speculating on ever inflating prices and always finding a sucker to pass on the hot potato, it's called the greater fool theory. Only people are to blame, nobody forces them to make these decisions. Only greed is to blame.

Originally Posted by troy

The likely reason it has not been mentioned is that these scams are all over Indonesia, and while illegal, many play them with full knowledge that at some point they'll go bust. But many know if they get out early enough they may get their promised returns that were som other poor sods principle. I forget the names of the larger ones, but they're out there and still active.

I am not so sure that there are as many scams as you suggest.

Using Jakarta Post as a guide, they have covered the KKM affair intensively with 13 articles from Feb 23 (the day after the police acted I think) up until Mar 11.

Searching their archives over the past 5 years for "ponzi" turns up these KKM articles plus only 2 more. On May 10, 2007 they reported "Indonesia a paradise for investment fraud" It says in part:

"Indonesia has become a haven for investment frauds because of the lack of knowledge and education of investors. Such frauds also happen in developed countries, but not to such a fantastic degree," Lin Che Wei, the president director of state-owned equity house Danareksa, said Wednesday in Jakarta.

Che Wei was referring to the US$385 million (about Rp 3.5 trillion) paid over by some 10,000 investors to Dressel through its Indonesian partner, PT Wahana Bersama Globalindo (WBG), which has now been lost after the company suddenly closed up shop on March 1.

And another article on Nov 25, 2008 headed "Beware of fraudulent investment" It starts by saying:

Fraudulent investment schemes remain lucrative in Indonesia. Many Indonesians (even highly educated elites) have become easy victims, they know thousands who may have been victims and the national media has often reported such scams.

But it seems to be referring to the Dressel affair above and adds no new information.

So the KKM affair would seem (from a Jakarta Post viewpoint) to be the first local operation with a shopfront that was building a local reputation by word of mouth.

Ron, I don't quite understand your post. You suggest it's not as widespread as I suggest but the rest of your post supports what I stated.

I'm sitting in a house right now in JKT and speaking to a friend who is telling me the neighbour used to run such an operation. Thousands upon thousands of them exist, and likely don't show up on the radar because they weren't bought into by the elite.

They exist everywhere yes - but I've yet to see it at such a retail and consumer level as it exists here in Indonesia.

I feel for those effected - it is tragic.

Markit, you're question, "how can I figure it out in 5 minutes?". Well it's like this. If you go into a village in Indonesia (not just villages mind you), many people work as "rain stoppers" - builders even call them to stop the rain before a pour of concrete. Stupidity has a way of persisting. It has persisted for centuries.

Troy F.

I went into one of these scams, but I knew it was early, I made out like a bandit because I took my profits, most people just "let it ride" .. It was one of the largest in the U.S called 12 daily pro, I was lucky, I got out 2 weeks before it all went to hell, lucky timing?. Some people make a living off getting in early in these scams and making a few turns and getting out, its sort of an art form...... hell there are even websites that teach you tips on how to get nto scams and get out,,,,, its all a gamble and the ignorant always loose.

froggy, bragging about ripping off others is very sad. Running like a bandit is exactly what you did. Make sure you don't get caught as participating to and making money out of a ponzi scheme is a criminal offence. Check the law in the US.

They had over 350,000 people on this one, the only one I ever joined,good luck prosecuting any "members", they nailed the person that organized it, I think 40 million dollars was floating around afer all was said and done. Not Bragging,I was lucky I got out, as far as ripping people off, please, they knew or should have known the risk of losing it all, if not it will be a lesson, like enron, stock market losses etc., lessons in life stick to you if you have sweat equity or cold cash losses involved. I do feel for anyone that had any hardship and used money they couldnt afford to lose. :(