(Philippine legal context; general information, not legal advice.)

1) The Core Rule: Nonpayment of a Loan Is Usually Civil, Not Criminal

A personal loan (“utang”) is commonly a simple loan (mutuum) under the Civil Code: the borrower becomes owner of the money received and is obliged to pay an equivalent amount, not to return the exact bills/coins. Because of that, mere failure to pay, even deliberate, is generally treated as a civil breach of obligation, not estafa.

Estafa (swindling) under Article 315 of the Revised Penal Code (RPC) requires more than nonpayment. It requires fraud—typically deceit at the start or abuse of confidence in a relationship where the borrower was supposed to hold or deliver the money/property for a specific purpose (not as a loan).

Practical consequence: Many “estafa for unpaid utang” complaints get dismissed if the facts show only a loan with default.

2) When Nonpayment of a “Personal Loan” Can Become Estafa

Estafa becomes viable only if the lender can prove elements that go beyond a simple loan default. The most common pathways are:

A) Estafa by False Pretenses / Fraudulent Acts (RPC Art. 315(2)(a))

This applies when the borrower obtained the money by lying about an existing fact or using a fraudulent scheme before or at the time the lender handed over the money—and that deceit was the reason the lender released the funds.

Typical examples that can support estafa (depending on proof):

Borrower used a false identity or impersonated another person to get the loan.
Borrower presented fake employment/income proof, fake payslips, fake COE, fake business documents, fake IDs.
Borrower offered nonexistent collateral or falsified ownership (e.g., fake OR/CR, fake title, fake deed).
Borrower pretended the loan was for a specific urgent purpose using fabricated facts (e.g., fake hospitalization, fake court case) to induce release.

Key legal point: A mere promise—“Babayaran ko sa sweldo,” “Sigurado ito”—is not enough by itself. The deceit must be about a fact, not just a broken promise, and it must exist at the inception of the transaction.

B) Estafa Through a Bouncing Check as the Fraud Mechanism (RPC Art. 315(2)(d))

This covers postdated checks or checks issued when the drawer had no sufficient funds, used in a manner that constitutes fraud.

However, estafa by bouncing check is not automatic. In many cases, the check must have been used as an inducement for the lender to part with money/property (i.e., part of the deceit at the time of loan). If the check was issued merely as payment for an already-existing debt, proving deceit for estafa becomes harder.

Important procedural proof typically needed:

The check was dishonored (e.g., DAIF/DAUD).
The drawer received notice of dishonor.
The drawer failed to make the check good within the period that creates the law’s prima facie indication of deceit (the RPC provision is commonly understood to use a short window after notice).

Closely related but separate: BP 22 (Batas Pambansa Blg. 22) punishes issuing a bouncing check regardless of whether it was used to induce the loan. Many lenders file BP 22 because it can be more straightforward than proving estafa’s deceit element. Estafa and BP 22 are distinct offenses and can be pursued separately when facts support both.

C) Estafa by Misappropriation / Abuse of Confidence (RPC Art. 315(1)(b)) — Often Confused With Loans

This applies when money/property was received in trust, on commission, for administration, or under an obligation to return or deliver the same, and the receiver misappropriated it.

Crucial distinction: If the transaction is truly a loan, this category usually does not apply because a borrower in a loan becomes owner and is not holding the money “in trust” for the lender.

But it may apply if what was called a “loan” was legally closer to:

Money given to buy something for the giver (agency/commission) but the recipient kept it;
Funds entrusted for a specific purpose with an obligation to return the same amount if unused, and the recipient diverted it;
Arrangements dressed up as “pautang” but actually entrustment or administration.

3) Elements You Must Prove (What Prosecutors Look For)

A) For estafa by false pretenses (Art. 315(2)(a))

You generally need proof of:

Deceit (false pretenses/fraudulent act) made before or at the time the money was obtained;
The lender relied on that deceit and released money;
The lender suffered damage/prejudice (loss);
Identity of the offender and clear linkage to the acts.

B) For estafa by bouncing check (Art. 315(2)(d))

Common proof issues:

The check must be linked to the fraudulent obtaining of money/property (not always required in BP 22).
Dishonor + proper notice + failure to make good within the statutory framework supporting deceit.

C) For estafa by misappropriation (Art. 315(1)(b))

Typical elements include:

Receipt of money/property in trust / for administration / with obligation to return or deliver;
Misappropriation or conversion;
Demand and failure/refusal (demand is often powerful evidence though not always framed as an absolute element);
Damage to the offended party.

4) Evidence Checklist (What Usually Makes or Breaks the Case)

A) Proof of the transaction and parties

Promissory note, acknowledgment receipt, loan agreement, IOU
IDs of borrower; copies of IDs used
Messages/emails showing negotiations and representations
Witness affidavits (if hand-to-hand cash delivery occurred)

B) Proof of deceit (for estafa theory)

Fake documents used to obtain the loan (COE, payslips, IDs, collateral papers)
Proof documents were false (employer certification denying employment, government registry checks, notarial irregularities, etc.)
Chat logs where false claims were made (with timestamps)

C) Proof of release and loss

Bank transfer records, e-wallet records, remittance receipts
Proof of cash release (withdrawal + acknowledgment; witness)
Computation of principal, interest (if stipulated), and balance

D) If a check is involved

Photocopy/scanned copy of check (front and back if possible)
Bank return slip / dishonor memo
Proof of notice of dishonor received by the drawer (registered mail + registry return card, personal service with acknowledgment, reputable courier proof)

5) Before Filing: Demand Letters and Why They Matter

Even when demand is not a strict element of every estafa mode, it matters because it:

Documents the default and the amount demanded;
Helps show the debtor’s conduct after default (evasive behavior, demonstrably false excuses);
Helps establish delay and supports claims for interest/damages in civil action;
Is essential for many bounced-check pathways because notice of dishonor is a central proof point.

Best practice: Put demands in writing, keep proof of receipt, and preserve calm, factual language (threatening language can backfire).

6) Where and How to File an Estafa Complaint

A) Primary venue: Office of the City/Provincial Prosecutor

Most estafa cases start with a Complaint-Affidavit for preliminary investigation.

Typical steps:

Prepare a notarized Complaint-Affidavit with a clear timeline and the specific estafa theory (false pretenses, bouncing check estafa, misappropriation—only if facts support).
Attach annexes (documents, screenshots, bank records) with labels (Annex “A,” “B,” etc.).
File with the prosecutor’s office having proper venue/jurisdiction.
Prosecutor issues subpoena; respondent files counter-affidavit; complainant may reply.
Resolution on probable cause; if found, an Information is filed in court.

B) Optional investigative assistance: PNP/NBI (when identity/evidence needs development)

If the borrower used aliases, fake IDs, multiple accounts, or online channels, law enforcement assistance can help structure evidence and identify leads—especially where platform records, SIM records, or bank/e-wallet tracing is needed through proper processes.

7) Choosing the Right Case: Estafa vs BP 22 vs Civil Collection

A) When estafa is more plausible

Clear proof of fraud at the beginning (fake identity, fake documents, misrepresentation of an existing fact) that induced release of money; or
A check used as part of the fraudulent inducement, with proper dishonor/notice proof; or
The “loan” is actually entrustment/administration, not a true mutuum.

B) When BP 22 is more plausible

There is a dishonored check with proper notice and failure to make good, even if proving “deceit at inception” would be difficult.

C) When the correct path is civil

The borrower is identifiable, the transaction is a straightforward loan, and there is no strong evidence of deceit at inception. Civil options include collection suits (often small claims where applicable) and other money-claim actions.

Important: Using criminal complaints purely as leverage in a civil debt dispute is risky if the facts do not support criminal elements; it can lead to dismissal and potential counter-actions.

8) Common Reasons Estafa Complaints for “Unpaid Utang” Get Dismissed

No deceit at inception—only a broken promise.
The documents show a plain loan (promissory note) with later default.
The alleged “misrepresentation” is about future ability to pay (e.g., “may sweldo,” “may project”) without proof it was a fabricated existing fact.
The check was issued only as security or as payment after the obligation existed, weakening the estafa theory (though BP 22 may still apply).
Evidence is mostly verbal; no concrete proof of fraudulent acts.

9) Drafting the Complaint-Affidavit: Structure That Works

A complaint that reads like a case file is more likely to move:

Parties and relationships (how you know the borrower; prior dealings)
Transaction details
- Date and place of agreement
- Amount, interest (if any), maturity date, terms
- How money was delivered (cash/bank/e-wallet)
Fraud allegations (if any)
- Exact statements made, by what medium (chat/in person)
- Why they are false and how you verified falsity
- Why you relied on them
Default and demands
- Missed due dates
- Demands made and responses received
Damage
- Principal loss, plus lawful interest/damages claimed
Evidence index
- Annex A: promissory note; Annex B: bank transfer; Annex C: chat screenshots; etc.
Prayer
- Investigation and filing of appropriate charges; civil liability

10) Civil Liability, Settlement, and “Compromise” in Practice

In criminal estafa, civil liability is typically pursued alongside the criminal case unless reserved, and restitution may be addressed through proceedings or settlement.
Compromise/settlement can occur, but it does not automatically erase criminal liability in every situation; outcomes depend on the charge, prosecutorial discretion, and court action.

11) Practical Warnings (Legal and Tactical)

Avoid public shaming, doxxing, or threats to force payment; these can trigger counter-complaints (harassment, libel/cyberlibel, data privacy issues).
Documentary Stamp Tax (DST) issues sometimes arise with promissory notes/loan instruments; nonpayment is often curable, but it can affect how documents are presented in court.
Interest rates: even if agreed, courts may reduce unconscionable interest; if none is stipulated, courts apply legal interest principles and jurisprudence depending on the nature of obligation and demand.

12) A Working Decision Guide

Only nonpayment, no strong fraud proof: Civil collection is usually the correct route.
Dishonored check with proper notice: BP 22 is often the cleaner criminal case; estafa may be added only if facts show deceit at inception.
Fake identity/documents or scheme used to obtain the loan: Estafa by false pretenses is the most fitting theory.
Money was entrusted for a purpose (not truly a loan) and was diverted: Estafa by misappropriation may apply if the trust/obligation to return/deliver can be proven.