Jurnal Ilmiah Akuntansi dan Bisnis Vol. 17 No. 1, January 2022 Fraud Analysis on Illegal Online Lending Using Habermas' Theory of the Public Sphere Nanang Shonhadji 1 * Abstract This study aims to find out and reveal how fraudulent practices in illegal online loans are carried out by P2P lending service providers from the point of view of Habermas' critical thinking. Research site was an illegal online lending practice and the informant were users and victims of fraud from illegal online lending practices who are domiciled in Surabaya, Sidoarjo and Pasuruan, East Java. This qualitative research uses the Radical Humanist Paradigm approach. Result of this research have shown that Habermas' theory of the public sphere can be used as a basis for thinking to reveal the fraud media used by illegal financial technology lenders. The need for clarity on regulations for peer to peer (P2P) lending transactions through online media and firmness of sanctions for perpetrators of illegal online loan fraud to protect the public is a form of consciousness proposed idea. Keywords: fraud, online loans, Habermas Introduction Public unrest and problems with illegal online lending services will only arise after the loan is approved and realized by the illegal peer to peer lending (P2P) providers. The unrest and problems occur because of intentional fraud committed by illegal online lending companies by ensnaring their customers through fraudulent actions. Charging large interest fees of up to 30% per month, imposing daily fines for late payments of up to 10% - 30% of loan principal, charging administrative fees that are not informed honestly and clearly. Falsifying office identity and address, utilizing personal data for actions that are against the law and social norms, intentionally changing the name of the application without notification to the customer. Furthermore, it will be difficult for the customer to make installment payments or repayment on time, but at the same time the interest on the loan keeps getting bigger, and others (Budiyanti, 2019; Ozcelik, 2020; Suseno & Yeti, 2021). These fraudulent practices are actual and felt by customers who initially had good intentions to borrow to maintain their business. However, the fraud committed by illegal P2P lending service providers has actually made customers helpless and their economy worse off. This raises concerns, in the context of efforts to protect customers from AFFILIATION: 1 Faculty of Economics and Business, Universitas Hayam Wuruk Perbanas , Indonesia *CORRESPONDENCE: nanang@perbanas.ac.id THIS ARTICLE IS AVAILABLE IN: https://ojs.unud.ac.id/index.php/jiab DOI: 10.24843/JIAB.2022.v17.i01.p03 CITATION: Shonhadji N. (2022). Fraud Analysis on Illegal Online Lending Using Habermas’ Theory of the Public Sphere. Jurnal Ilmiah Akuntansi dan Bisnis, 17(1), 33-49. ARTICLE HISTORY Received: 24 August 2021 Revised: 24 November 2021 Accepted: 22 November 2021