💰 CEO Cashed Out $15 Million, But the Real Mastermind Is Still on the Run 🚨

❓ Why Does This Case Matter?

The downfall of the Kresna Group stands out as one of the most complex and consequential corporate scandals of the 2020s in Indonesia.

At the heart of the controversy was Kresna Life, which became the epicentre of the turbulence. The case exposed a tangled web of violations spanning insurance, securities laws, and anti-money laundering laws, to undisclosed affiliated transactions to investments in high-risk technology ventures. Legal proceedings unfolded across multiple forums, including the criminal court, insolvency court, and administrative court, highlighting the multi-layered nature of law enforcement in the financial sector.

Kresna Life defaulted on its obligations to thousands of customers who had purchased investment-linked insurance products. Investigations revealed that policyholder funds had been diverted to fuel Kresna Group’s aggressive expansion strategy, including speculative investments in tech startups and affiliated companies.

While Kresna Life briefly secured a procedural win in the administrative court to challenge OJK’s license revocation, the Supreme Court ultimately sided with the regulator, affirming the seriousness of the violations and the need to protect public interest.

🛠️ How Did It All Start?

📦 Product Launch and Design

Kresna Life began offering two products, K-LITA and Protecto Investa Kresna (PIK), framed as life insurance with investment components or “unit-link”. While the court documents do not detail the policy terms, both products seem to be effectively operating as investment-linked insurance schemes and heavily marketed for their return potential rather than insurance protection.

Lacking internal asset management capabilities, Kresna Life outsourced fund management to its affiliate, Kresna Asset Management, which placed customer funds in mutual funds, a fact not disclosed in the policy documents and actually violated its own insurance policy contracts.

The company also allocated a significant portion of its assets (over 42%) to affiliated technology companies and Kresna’s intra-group lending, breaching OJK’s investment affiliated equity investment portfolio rules of 25%.

🚫 Return Guarantees and Regulatory Violations

Although OJK regulations strictly prohibit any investment product from offering guaranteed returns, Kresna Life’s insurance products appeared to do just that. Upon investigation, OJK reviewed the official policy documents submitted for approval and found significant discrepancies compared to the versions actually distributed to customers.

This constituted a clear violation of regulatory requirements and amounted to a misrepresentation of the product’s nature. Under Indonesian insurance law, such misrepresentation is not just a regulatory breach; it is subject to criminal penalties. Combined with undisclosed affiliated transactions and a product structure designed to mimic investment instruments, the offerings were essentially investment contracts masquerading as insurance policies.

📉 Liquidity Crunch During the Pandemic

The scheme began to unravel during the COVID-19 pandemic, when customers attempted to withdraw their funds and found their requests unfulfilled. The company’s inability to meet these obligations exposed a liquidity crisis, triggering widespread public complaints and regulatory scrutiny.

This financial distress led to a separate legal proceeding in 2021, where the commercial court declared Kresna Life bankrupt. In 2023, OJK formally revoked the company’s insurance license for its failure to maintain its capital within the legal solvability ratio, a decision that was challenged but ultimately upheld by the Supreme Court in 2025.

⚖️ What Did the Courts Conclude?

While Kurniadi may not have been the ultimate beneficiary of all the misused funds, the court emphasized that he had full awareness of the product structure, the flow of customer funds, and the regulatory violations involved. As a high-ranking executive, he held both decision-making authority and fiduciary responsibility.

Ultimately, the Supreme Court sentenced him to 12 years in prison, holding him accountable for his role in the misconduct.

🛑 The court rejected arguments of good faith or lack of intent, emphasizing that the systematic design and long-term implementation of the scheme showed clear intention. Kurniadi’s direct involvement in approving, promoting, and managing the scheme made him legally and ethically liable.

📌 Key Takeaways if You Work in the Financial Sector

🏢 Be Cautious with Large Interconnected Group

Always exercise extreme caution when working within large business groups or financial conglomerates. In Indonesia, many of these groups operate multiple entities across banking, insurance, asset management, and real sectors such as energy, property, and technology, with blurred boundaries and frequent non–arm’s-length transactions.

Kresna Group, for instance, was particularly aggressive in deploying capital through its investment arms in the 4–5 years leading up to its collapse, pursuing high-risk bets in technology and capital markets. An insurance executive may not have been directly involved or even aware of these decisions, yet when the group’s bets failed, liability spread across units. Even if you're only an officer in one entity, you can easily get dragged into legal consequences triggered by actions taken elsewhere within the group.

📜 Don’t Try to Outsmart Financial Compliance

Indonesia’s financial sector is heavily regulated, and for good reason. The country has a long history of financial crises. Any new product, feature, or operational change often requires explicit regulatory approval. Don’t try to outsmart the system or cut corners; gambling with compliance can lead to criminal charges, no matter how good the intention may seem.

💼 High Position = High Responsibility

Being a director or C-level executive in a regulated company carries significant personal legal risk. Courts will hold you accountable not just for what you did, but also for what you knowingly allowed or ignored. Titles won’t shield you when things go wrong.

Source: 

• Decision of the District court No. 538/Pid.Sus/2023/PN Jkt.Sel

• Decision of the High Court No. 54/PID.SUS/2024/PT DKI

• Decision of the Supreme court No. 5589 K/Pid.Sus/2024