Quoted from rubberducks:
There's a clear question of intent or lack thereof, however. Both from an ethical and legal point of view. There's a difference between him (or anyone) intending to deliver something (even if the whole project is to feed their ego) and never intending to do anything and run off with the money.
If you really believe the intention was to make off with the money, then he's a far more incompetent thief than an incompetent and ill-equipped manager and business owner given the alternative. I know which I think is more likely.
My argument has always been that when the situation involves dollar sums on the magnitude as this (a million bucks) the "Aw shucks, guys, my bad" excuse is not available. You have an obligation to have your shit together or don't go swimming in the deep end of the pool.
But ignoring that for a moment, Jpop knew enough that he knew he had to appear to have his act together to sell the thing: non-disclosure agreements, a printed timeline with milestones and deposit schedule, build blog, partnership with Ben Heck, etc. In hindsight, these all paint the picture of a guy who intended to sell an image but had no real plan outside of selling just the image. In other words, he was selling smoke and mirrors and he was very conscious of it.
Now add to that the guy tinkered in a workshop for four years with a team and still didn't produce a single game. Four years to run the numbers over and over and realize "I need help." Help was offered many times and refused, in fact.
To put that in perspective, Skit-B had a mostly working game when they started taking pre-orders. Where skit-b STARTED was further along than where JPOP crashed and burned following 4 years and a million bucks.
Then, after all deadlines had passed and he was obviously in breach of his own contract, when people attempted to contact him for refunds he ignored them. But he always had time to take more pre-order money.
We're not talking about a situation where Jpop left all the money in a duffel bag on the subway. "Jeez, what an idiot! But he didn't intend for our money to get stolen..." We're talking years of misinformation, assurances, and lies, and all with slick packaging to give an air of legitimacy.
So at what point does that kind of gross incompetence, willful ignorance and fiduciary neglect become an outright criminal matter? I think a long time ago.