Indonesia Freezes Rp 674 Billion in Market Manipulation Probe After $74 Billion Stock Rout

Two Fund Investigations Account for $40 Million Freeze

Indonesian police have frozen bank and securities accounts worth Rp 674 billion, approximately $40 million, in a criminal investigation into alleged insider trading and market manipulation. As of February 4, 2026, the investigations into Narada Asset Management and Minna Padi Asset Management have identified five suspects and involved questioning 114 witnesses.

The frozen assets comprise approximately Rp 207 billion connected to the Narada case and Rp 467 billion linked to Minna Padi. Investigators are examining whether people connected to the firms used affiliated companies, mutual fund accounts and coordinated transactions to push share prices away from the value suggested by the businesses behind them.

The enforcement action follows a report by global index provider MSCI Inc that raised concerns about transparency and suspected coordinated transactions on the Indonesia Stock Exchange (IDX). The ensuing market rout erased roughly $74 billion in stock market value, while the benchmark Jakarta Composite Index fell nearly 7% in the immediate aftermath.

Brigadier General Ade Safri Simanjuntak, director of special economic crimes at National Police headquarters, confirmed that the Criminal Investigation Agency was examining both insider trading and fictitious trading practices.

The Criminal Investigation Agency is currently conducting a formal investigation into insider trading and fictitious trading practices in the capital market.

The cases centre on how investments were bought, priced and transferred between related parties. For investors, the concern is straightforward: a share price can look attractive because trading suggests strong demand, even when that demand has been arranged by people acting together.

MSCI Concerns Shake the Exchange and Regulator

MSCI's report arrived amid growing concerns about the integrity of Indonesia's capital market. Its warnings about transparency and suspected coordinated transactions were followed by a sharp selloff, exposing weaknesses in confidence as well as in the way investors assess trading activity.

The financial and institutional fallout extended beyond falling prices. IDX chief executive Iman Rachman resigned, as did senior officials at the Financial Services Authority (OJK), Indonesia's main financial regulator.

The roughly $74 billion erased from the exchange represents a fall in the market value of listed shares. The approximately $40 million frozen by police consists of assets in specific accounts connected to the investigations. The selloff and the freezes therefore describe different parts of the crisis: a broad loss of market value and a targeted criminal enforcement action.

The developments unfolded across several stages:

• In mid-January, shares in PT Diamond Citra Propertindo rose sharply after a social media post, then returned to their starting price that day.
• MSCI subsequently flagged transparency concerns and suspected coordinated transactions, followed by a market rout and resignations at IDX and OJK.
• By February 4, police had disclosed the Narada and Minna Padi investigations, the named suspects and the combined Rp 674 billion account freeze.

How the Alleged Trading Arrangements Worked

Narada and Minna Padi managed mutual fund products. A mutual fund brings together money from investors and places it in assets such as shares. Those investments are the fund's underlying assets, and their value helps determine what investors' holdings are worth.

Police are examining arrangements in which the shares held by funds were connected to people inside the businesses managing or influencing those investments. Affiliate structures link companies or accounts through shared ownership or control. Nominee arrangements can place holdings under another name while the underlying interests retain effective control.

Investigators suspect such networks allowed insiders to present transactions as dealings between independent parties even when connected people controlled both sides. Trading within these networks could create an appearance of demand that was stronger than genuine outside investor interest.

Capital market specialists consulted by police said transactions among affiliated parties can materially influence share prices and mislead investors about real demand. In the alleged arrangements, prices reflected coordinated trading instead of independent decisions by buyers and sellers.

Insider trading concerns the use of information unavailable to other investors. Fictitious trading and price manipulation concern the creation of a misleading picture of market activity or prices. Police are investigating these practices within the capital market, with the detailed allegations against each firm focused on its particular transactions and relationships.

Narada Probe Questions 70 Witnesses

At Narada Asset Management, investigators found indications that the underlying assets of certain mutual fund products included shares connected to projects and controlled by company insiders through extensive affiliate networks.

Police suspect the transactions were deliberately arranged to create a false impression of demand. That could cause share prices to move sharply away from company fundamentals, meaning the financial condition and business performance that investors normally use to judge a company's value.

Ade Safri said capital market experts consulted during the investigation confirmed that trading among affiliated parties could affect prices and give investors a misleading view of market interest. An investor looking only at the price and volume of trades might therefore see apparent enthusiasm without seeing the relationships behind it.

Investigators have questioned 70 witnesses and obtained opinions from capital market specialists. Two suspects have been formally identified: MAW, Narada's president commissioner, and DV, president director of the affiliated company Narada Adikara Indonesia.

Authorities have frozen approximately Rp 207 billion, or $12.3 million, in accounts connected to the Narada case. The investigation is examining how internal control, affiliated transactions and the assets held by the funds fitted together.

Minna Padi Faces Allegations of Inflated Resales

The investigation into Minna Padi Asset Management (MPAM) concerns suspected coordinated transactions in shares used as underlying assets for mutual fund products. Police say the arrangements involved MPAM's mutual fund accounts and a shareholder identified as ESO.

ESO holds stakes in affiliated companies Minna Padi Investama and Sanurhasta Mitra. Investigators are examining transactions involving these connected interests and the funds managed by MPAM.

Police allege that affiliated shares were bought at artificially low prices and then resold to other mutual funds at much higher prices to generate illicit profits. In practical terms, the alleged arrangement moved shares between related accounts while changing the prices attached to them.

Such circular trading can make a market appear busy even when the transactions largely serve the same underlying interests. It can also transfer wealth between accounts, because the fund paying the inflated price bears a higher cost while the seller receives the gain.

The MPAM investigation has involved 44 witnesses and consultations with experts in criminal law and capital markets. Police have named three suspects: MPAM president director DJ, shareholder ESO and ESO's wife.

Authorities have frozen 14 securities subaccounts linked to MPAM and its affiliates. These include six mutual fund subaccounts holding a combined Rp 467 billion, approximately $27.8 million, in assets under management. Assets under management are the investments a firm oversees for its clients.

Using the rupiah figures, the Minna Padi assets account for about 69% of the combined Rp 674 billion freeze, compared with about 31% for Narada. The larger Minna Padi amount makes the handling of mutual fund assets a central part of the enforcement action.

What Indonesian Law Says About Fried Stocks

OJK officials have used the investigations to clarify their position on practices commonly described locally as "fried stocks." The expression refers to abnormal price formation associated with manipulation, although it has no formal regulatory definition.

Hasan Fawzi, acting member of OJK's Board of Commissioners and chief executive for capital market supervision, said the relevant conduct is covered by Capital Market Law No. 8 of 1995. He described price manipulation as a criminal offence.

The law clearly defines price manipulation in the market. Such actions fall under the category of criminal offenses.

Article 91 prohibits any party from creating false or misleading impressions about trading activity, market conditions or securities prices. It provides the legal foundation for the criminal investigations and the continuing regulatory reform effort.

The rule addresses the information a market sends through its trading. Prices and trading volumes help investors decide whether to buy, hold or sell. When coordinated transactions distort those signals, investors may make decisions based on an inaccurate picture of demand.

Regulators Promise Enforcement Across Ownership Groups

Acting OJK chair Friderica Widyasari Dewi said stronger enforcement against capital market violations was a priority. Speaking during a Capital Market Dialogue at the IDX Main Hall, she identified manipulation and misleading information as practices the regulator intended to target.

The main example that we will strengthen enforcement on is the manipulation of stock transactions or the term that friends like to use is 'fried (stocks)' and also misleading information.

Friderica said these practices were particularly damaging to retail investors, who may lack sophisticated analytical tools for detecting artificial price movements. Retail investors are individuals investing their own money, rather than large institutions managing substantial portfolios.

IDX development director Jeffrey Hendrik reinforced the position that independent regulatory organisations would pursue activity aimed at manipulating prices regardless of who was responsible.

Market manipulation doesn't target any specific group. Any party that manipulates prices in the market is committing a capital market crime.

Market participants have debated whether shares associated with major conglomerates and trading at potentially inflated valuations might also receive greater scrutiny. Regulators say their enforcement decisions depend on evidence of manipulative trading practices, with ownership and valuation considered alongside the actual conduct under investigation.

Hasan Fawzi said OJK would focus on whether transactions contained the elements of a capital market crime, rather than selecting particular stocks or ownership groups.

It's not about whose shares it is. As long as the elements of a capital market crime are met, we will take action. Enforcing these provisions and laws is part of our capital market reform action plan, and we will implement it.

DADA's One Day Surge Shows the Risk of Speculation

PT Diamond Citra Propertindo, traded under the ticker DADA, offered a recent example of a rapid price movement without an accompanying explanation from the company about its business.

In mid-January, Yudo Achilles Sadewa, the son of Finance Minister Purbaya Yudhi Sadewa, posted on social media that he dreamed the stock could reach Rp 300,000. DADA shares, initially trading at Rp 50, then briefly reached the upper auto rejection limit at Rp 67.

The move from Rp 50 to Rp 67 was a 34% increase. The shares subsequently plunged to the lower limit and closed back at Rp 50 on the same day, leaving the closing price unchanged despite the sharp movement during trading.

Auto rejection limits set boundaries for the prices at which orders can be accepted during a trading session. DADA's movement between those limits illustrates how quickly sentiment around a stock can change.

DADA management later said it was unaware of material information that could explain the price movement. Material information means information important enough to affect an investor's assessment of a company or its shares.

The episode illustrates the risks surrounding coordinated buying calls and influencer posts when they are unaccompanied by material corporate information. A sudden rise can draw buyers into a stock before the enthusiasm fades, exposing anyone buying near the peak to a rapid loss.

Volatile Shares Add Pressure to the Wider Market

The Narada and Minna Padi investigations have brought greater attention to speculative shares lacking strong business fundamentals. Such securities can contribute to sharp movements in the Jakarta Composite Index, particularly when negative sentiment prompts many investors to take profits at once.

Limited disclosure makes these movements harder for ordinary investors to assess. When a price rises dramatically after social media buying calls, investors need information about the company to understand whether its prospects have changed. Without that information, market excitement can become the main driver of trading.

The alleged mutual fund arrangements add another layer of risk. Investors in a fund depend on its manager to select and price assets. If related parties control the underlying shares and the transactions involving them, investors may have difficulty seeing how the price was formed or whose interests a trade served.

The enforcement response therefore concerns both the signals visible on the exchange and the relationships behind investment products. Police are investigating transactions, while OJK and IDX officials are committing to stronger oversight and action against misleading information.

Shinhan Search Extends the Investigation to an IPO

Police are also examining at least one additional major securities firm. Authorities have searched the offices of PT Shinhan Sekuritas Indonesia in South Jakarta as part of an investigation into alleged manipulation connected to the initial public offering of PT Multi Makmur Lemindo, whose ticker is PIPA.

An initial public offering, or IPO, is the process through which a company first offers its shares to public investors. The Shinhan investigation extends the scrutiny beyond mutual fund transactions to activity associated with a company's entry into the public market.

Across the investigations, police have described complex arrangements involving shares connected to projects, nominee networks and affiliated companies. The suspected arrangements allowed internal parties to retain effective control while presenting investments as transactions between independent participants.

As of February 4, no timetable was given for completing the investigations, bringing the cases to court or releasing the frozen accounts. The five people identified in the Narada and Minna Padi cases remain suspects facing allegations under investigation.

The immediate response combines account freezes, witness questioning, expert assessments and searches with promises of capital market reform. Its central focus is how shares are traded and priced, and whether investors receive an accurate picture of the activity behind their investments.

The Bottom Line

• Police froze Rp 674 billion, approximately $40 million, in accounts connected to alleged insider trading and market manipulation.
• Narada's investigation involves 70 witnesses, two suspects and approximately Rp 207 billion in frozen accounts.
• Minna Padi's investigation involves 44 witnesses, three suspects and 14 frozen securities subaccounts, including six mutual fund subaccounts holding Rp 467 billion.
• MSCI's transparency concerns preceded a nearly 7% index fall, roughly $74 billion in lost market value and resignations at IDX and OJK.
• Article 91 of Capital Market Law No. 8 of 1995 prohibits false or misleading impressions about trading, market conditions and securities prices.
• Police also searched Shinhan Sekuritas Indonesia's offices over alleged manipulation connected to the PIPA initial public offering.
• OJK and IDX officials say enforcement will focus on manipulative conduct regardless of ownership group.