Money changer outlets in Kuta have been the source of much interest from the authorities in recent weeks. After a series of checks from the Bank of Indonesia and the Public Civil Service (Saptol PP), it was found that over a dozen outlets in the Kuta area were operating outside of the law.
This week the authorities closed down another outlet after tourists complained that the teller short-changed them by hundreds of dollars. The couple, who are from Australia, told their host that the outlet had not only given them a poor exchange rate but not given them the agreed amount. Whatsmore, they did not issue receipts for the exchange. Their host helped them contact the local authorities to see what could be done about the situation.
The chairman of the Legian Village Community Empowerment Institution (LPM), I Wayan Puspa Negara told local newspapers that ‘It happened two days ago. The tourists feel that there is a shortage of IDR 2.2 million in exchange’.
According to Negara, the tourists exchanged a large sum of US dollars at the Kuta outlet. The rate they were told was IDR 14,000 for 1 USD which at that time was an accurate exchange rate.
Only when the couple got back to their accommodation and counted the cash, they discovered that they were IDR 2.2 million short meaning either the exchange rate they were given was exceptionally poor, or they were actively short-changed. Local reports suggest that the couple was looking to exchange USD 700 for Indonesian rupiah.
The couple is said to have returned to the outlet and made their feelings known about the issue at hand. The outlet owner is said to have made peace with the couple and given them a fair amount of money.
Negara told the press that ‘Tourists are at peace because their money is returned. I was forced to cut off the electricity for a shock effect for them [while talking to the owner]. Because our authority is limited, these are the Satpol PP, the police, BI, and the Association of Foreign Exchange Traders (APVA)’.
After the issue was resolved with the couple, Negara and the Legian Village Community Empowerment Institution closed down the outlet on the grounds that they were operating fraudulently. The electricity remains unplugged and the shop cannot open.
He told the reporters that the Bank of Indonesia and the APVA has been informed so that greater legal action can be taken. He suspects that there may be more outlets like this operating in the area.
Other local newspapers have reported how a total of 16 outlets have been closed down in recent weeks following the audits from the Bank of Indonesia and Saptol PP. The audits largely found that although the outlets were giving proper exchange rates, they did not have up-to-date business permits and licensing.
The authorities gave the money changers a few weeks to get their paperwork in order. Some have failed to do so which is why the local leaders have stepped in.
The closing of the facilities has been organized by the local traditional village management and security teams known in Bali as Pecalang. The teams have sealed off 16 outlets in the Kuta areas.
One of the leaders of the village authorities Wayan Wasista told NusaBali that ‘”I emphasize, the Kuta Traditional Village has never prohibited people from doing business, as long as it is done according to the applicable rules and regulations. This step is not prohibiting, but protecting Kuta, which we love, from negative things. Please try, but obey the rules and complete the permissions. If it’s incomplete, it’s the same as illegal,”
Wasista later explained that no legal action is being taken at this time but that if any of these 16 outlets try to reopen before they have their paperwork in order, the local village authorities will take them to court.
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