What to do about Bounced Checks



  • Avoid becoming a victim by following simple procedures
    •
    The writer of any check may be presumed to know whether or not he or she has enough money to cover the check when the check is issued. We recognize that many people do issue checks against insufficient funds because of an innocent mistake.

    This article contains information on measures you can take to prevent yourself from being victimized by a bad check, and secondly, to inform you of the steps to take if you are, unfortunately, a victim.

    • Beware of strangers attempting to cash checks.

    • Have the person sign in your presence and be sure you have the person's address and a telephone number.

    • Verify that the address exists via the internet or a phone book directory.

    • Avoid suspicious addresses such as hotels, rooming houses, post office box numbers, etc.


  • When a check is returned
    •

    If a check is returned back to you marked "Insufficient Funds" or "Account Closed:"

    First, attempt to contact the issuer of the check to resolve the situation. If upon contacting the check writer he or she refuses to reimburse you for the check, return the check to your bank and request that they obtain a "Certificate of Protest" for you. Then, bring the check, protest and other documentation of the transaction to your local District Attorney's Office.

    The local DA's office will assist you in filing a complaint, and if applicable, an additional count of larceny.

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    See an article entitled "The ABC's of
    Cashflow Management"






  • Preventive Steps to Take


    • Additional steps you can take to prevent your business from being victimized by bad checks are:
  • Insist upon proper and recognizable identification and examine it carefully. Make a note on the back of the check as to the person's physical description and driver's license number. A local license is obviously to your advantage. In order to bring a prosecution, you must be able to identify the person who issued the check.
  • hen in doubt, don't cash a check. Ask the person to come back later with cash.

  • Examine the check carefully. Check the date and amount making sure that nothing has been altered, erased or rewritten.

  • Don't cash or accept checks for large amounts. Don't hesitate to call the bank on which the check is written. They should cooperate in checking the account. Do not accept checks on out of town banks.

  • Do not accept third party checks or checks that are dated later than the date presented to you. Never agree to hold the check for any length of time before depositing it into your bank account. Be sure to deposit the check into your account within thirty days.

  • Be particularly careful in cashing or accepting checks on Friday nights, Saturdays and Sundays when you cannot call the bank on which the check is drawn. Don't make cash refunds before the check clears.
  • If you are an employer, assign responsibility for approval of checks to only one or two trusted employees.