Bali police say Aussie bag snatch claims are 'lies'

Bali police say claims that an Australian hairdresser was violently mugged were lies told in a bid to gain an insurance payout, Indonesian media report.

General Crime Director Kombes Andi Fairan told local media outlet Kampuran that police believe Emma Bell, who suffered serious injuries, was instead involved in a traffic crash.

"The victim did not experience a bag snatch and there was not a single item of the victim missing," Mr Fairan said.

"The reason for the victim to make news is so that victim gets an insurance claim in their country."

Police investigated a report that the Byron Bay woman was walking alone in tourist hotspot Canggu when her bag was snatched by a passing motorcyclist, causing her to hit the ground head first and be dragged for several metres.

"She's got broken cheekbones and bleeding on the brain which doesn't seem very positive," friend Josh Sleep told 9News from Kuta's BIMC Hospital at the time.

But police claim their probe uncovered a different version of events and that another friend Bryden Ian allegedly admitted there'd been no bag snatch.

"The victim's friend explained that Emma purely had a traffic accident," Mr Fairan said.

An online crowdfunding page set up to gather donations towards Ms Bell's medical expenses has raised almost $17,000.

"She recently moved to Bali as she was sponsored to do her all-time love of hairdressing at an amazing salon," friend Emi Thompson wrote.

"She had it all sorted and has been living the dream.

"We just want her to recover the best she can so she can be healthy again. It's oh so scary. We are all in utter shock."

Ms Bell has since been airlifted to a Perth hospital where she's in a stable condition following surgery.

Ms Bell has been contacted for comment.

Aussie tourists injured in scooter crashes on the holiday island are often left in the lurch financially even if they take out travel insurance, with claims only allowed if the victim has an Australian motorcycle licence as well as an international driver licence.