In the state of Michigan, passing a bad check is illegal. A person who intentionally writes a check on a nonexistent or insufficiently funded bank account faces criminal charges, which can result in fines and incarceration. How severe the penalties are depends on the check amount and if the individual has a prior conviction for check fraud.
What Is a Bad Check?
A bad check is a check drawn on a nonexistent account or an account with insufficient funds. A bad check is also known as a "hot check." Sometimes an individual will write a bad check unintentionally; they simply don't realize that they lack the funds in their account. In that instance, their bank will typically charge them an overdraft fee.
Depending on the circumstances and the state, intentionally passing a bad check can result in a misdemeanor or a felony. Cashier's checks, certified checks and money orders are safer and less susceptible to fraud.
Defining Check Fraud Under Michigan Law
In Michigan, it is illegal to pass a bad check when an individual's checking account lacks the funds to cover the check. Individuals may also face criminal charges when writing a check against a bank account that no longer exists.
Whether it is intentional fraud or not, a person writing an NSF check can face severe criminal penalties. Typically, when an individual receives a notice from the bank informing them of insufficient funds, they have five days in which to pay the check amount. If they don't attempt to correct the situation, they may face fraud charges.
Penalties for Writing Bad Checks in Michigan
Criminal penalties for intentionally passing bad checks include jail time/mileg.aspx?page=getObject&objectName=mcl-750-131) and substantial fines. A no-account check violation can carry up to two years in prison with fines of up to $500. If the charge is intentional check fraud by writing checks on an account containing non-sufficient funds, the penalties depend on the check amount and if the offender has prior convictions of check fraud.
An offender who wrote a bad check for less than $100 faces up to 93 days in jail and a maximum fine of $500. A bounced check in the amount between $100 and $500 carries a maximum $1,000 fine or three times the amount of the check (whichever is more), and jail time of up to one year.
A bad check that is $500 or more carries two years in prison and fines up to $2,000 or three times the check or draft (whichever is more.) If the check writer has prior criminal charges, the penalties can be even more severe.
Bad Check Recovery Through a Civil Action
Not all bad checks are necessarily crimes. Some dishonored checks can result from a "stop-payment" request or the nonperformance of services. Investigators will review a bad check complaint to determine if a crime occurred.
A person who is owed money from a bad check can file a civil case against the person who passed the check. If the amount is $6,500 or less, they can file suit in small claims court. They do not need an attorney to do this, but must contact their local district attorney's office to get guidance and a small claims filing form. If the amount is more than $6,500, they can hire an attorney to help them file a civil lawsuit.
Michelle Nati is an associate editor and writer who has reported on legal, criminal and government news for PasadenaNow.com and Complex Media. She holds a B.A. in Communications and English from Niagara University.