A Bali developer won't return your money: contract dispute or fraud?
When an investor wants their money back, or wants what the contract promised, the first step is not a lawsuit and not a police report — it's a legal analysis. This is a report that classifies the situation from the documents and the timeline, weighs the prospects of each route, and lays out a plan of action. Here is how it works, using one of our clients' cases.
Our client's case
A group of foreign investors signed "investment agreements" with a developer to buy units (individual apartments) in a complex under construction in Bali, for several million dollars. Most of the sum was paid in cryptocurrency. The completion deadline passed, construction never began, and for about two years there has been no activity on the site.
The developer points to a pending PBG (Persetujuan Bangunan Gedung — a building approval). The money has not been returned, even to those who already signed termination agreements. There is no proof of any expenses, and the developer refuses to share any accounting.
The main question: contract dispute or crime
The bare fact that the project wasn't built and the money wasn't returned is not a crime. The fork runs between non-performance of a contract (wanprestasi), fraud (penipuan), and embezzlement (penggelapan). Contrary to a widespread belief, the size of the loss does not turn a contract dispute into a crime: a criminal classification requires evidence of intent to deceive.
Each route calls for its own evidence. To weigh every option, assess the risks, and build a strategy, you need a legal analysis.
The civil route (wanprestasi)
The civil route applies if the developer can show, with documents, that the PBG application was filed, the land is properly titled, and the funds are going into the project. The basis is the Civil Code (KUHPerdata), Article 1243 (compensation for losses) and Article 1238 (a formal demand fixes the default). You can claim the return of your investment, damages, and a penalty — with one caveat: courts are skeptical of penalties that far exceed the principal debt.
The criminal route (penipuan and penggelapan)
If no PBG application was filed, there are no land rights and no technical readiness, and the money was collected on the promise of an imminent start, then fraud and embezzlement come into view. As of January 2, 2026, a new Criminal Code is in force (UU 1/2023): fraud is Article 492 (formerly 378), embezzlement is Article 486 (formerly 372). Acts committed before that date are governed by the old code, unless the new one is more lenient.
A separate complication: payment in cryptocurrency
Under UU 7/2011 (Article 21), payments made within Indonesia are settled in rupiah; cryptocurrency is not a means of payment but a digital financial asset supervised by OJK (UU 4/2023, PP 49/2024, POJK 27/2024). This does not cancel the right to demand a refund, but it does make the case harder to prove. For each transaction you will need the date, the amount, the equivalent value at the time of transfer, the wallet addresses, the hash, and the developer's confirmation that the transfer was accepted as payment under the contract.
The plan of action after the analysis
Evidence base and a pre-litigation demand. We consolidate the documents and the timeline and send the developer a somasi — a formal demand requiring them, within 7–14 days, to provide proof of PBG registration, explain the reasons for the standstill, show a report on how the funds were used, give explanations about the "creditors," and set out a repayment schedule.
Assessing the response. If the developer provides documents showing a real approvals process, the matter is civil: negotiation or a non-performance (wanprestasi) claim. Silence, or an inability to account for the money, strengthens the criminal version.
Acting on the result. A civil claim with interim protective measures, a criminal complaint, or a combination of the two. The client makes the choice based on the facts on record.
The letters are not a formality — they document the investors' good faith and create evidence for any route that follows.
What to do if you are in a similar situation
Stop making further payments until the legal review is complete.
Preserve correspondence and project materials with their dates; gather your payment records, and for crypto, a complete table of transactions.
Do not sign termination agreements or acknowledgments of someone else's debts without review. Do not re-sign contracts — it resets the clock.
Join forces with others affected: a single shared timeline strengthens the position.
Order a legal analysis before any lawsuit or complaint. A hasty criminal complaint over a contract dispute usually ends in rejection and lost time.
FAQ
Non-performance on its own is a contract dispute (wanprestasi). A criminal classification is only possible where there is evidence of intent to deceive — for example, money collected on promises for which there were neither land rights nor a filed permit application.
The right to a refund stands, but it is harder to prove. You need a full table of transactions: dates, amounts, the equivalent value at the time of transfer, wallet addresses, the hash, and confirmation that the transfer was accepted as payment under the contract.
A PBG (Persetujuan Bangunan Gedung) is a building approval. Developers often cite a pending PBG to explain a standstill. A legal analysis is precisely what checks whether the application was actually filed, or whether the reference is being used as a pretext.
A demand (somasi) fixes the default and documents the investor's good faith, and the developer's response often shows which route — civil or criminal — has the better prospects. It saves time and money before you commit to a strategy.
In short
A legal analysis turns "we have to do something" into a sequence of steps. The choice of route stays with the client, but it is made on the basis of facts and law, not assumptions.
If you have run into a similar situation, contact us before it becomes urgent — we will help assess your case and propose a plan of action.
