The California Statute of Limitations on NSF Checks

Business owner making purchase order
••• Kanawa_Studio/iStock/GettyImages

Related Articles

In California, writing a bad check, also known as an insufficient funds check or NSF check, is considered a wobbler offense. That means that writing a bad check can be charged as a misdemeanor or a felony, depending on the amount of the check and the offender’s history. The varying penalties for writing a bad check can be found in California Penal Code Section 476a. It is possible for an individual charged with passing bad checks to be charged with multiple offenses, including check fraud, forgery and grand or petty theft.

An individual can create a bad check in a number of ways. They can change the dollar amount, alter the routing number or check number, or alter the date. They can also forge the signature of another party. In addition, they can create a fake check altogether.

Grand and Petty Theft

When the value of a bad check is $950 or less, the offense is considered petty theft in California. When the value of a bad check is $951 or more, the offense is considered grand theft. Theft includes making or passing a fraudulent check or using a fraudulent check by cashing it or exchanging it for goods. Grand theft can be charged as a misdemeanor or a felony.

When charged as a felony, grand theft carries the penalties of up to three years in jail and a fine up to $10,000. When charged as a misdemeanor, grand theft carries penalties of up to one year in jail and a fine up to $1,000. Petty theft, which is a misdemeanor, carries the penalties of up to six months in jail and a fine up to $1,000. The offender will be required to make restitution, or repay the victim the amount of the check. The offender may also be required to complete a class regarding theft.

Insufficient Funds and Check Fraud

An individual who writes a bad check and has insufficient funds in their bank account may have passed the check without realizing that they did not have enough money to cover the charges. The state is required to prove that the individual knew they did not have sufficient funds or that they had fraudulent intent to deceive another entity to gain money, goods or services.

A notice of protest is admissible as proof of nonpayment. A notice of protest is a formal declaration executed by a notary which states that an instrument like a check was presented at a certain time and place and was not honored. A notice of protest is presumptive evidence that the individual had knowledge of insufficiency of funds.

Immigration Consequences of Check Fraud

U.S. immigration laws classify check fraud as an aggravated felony. A person who has been convicted of an aggravated felony on or after November 29, 1990 is permanently barred from establishing good moral character for naturalization. An applicant convicted of an aggravated felony before November 29, 1990 may not be permanently barred for naturalization. Yet an immigration officer must consider the seriousness of the underlying offense and the applicant’s present moral character.

If the applicant’s actions during the statutory period do not reflect a reform of their character, the applicant may not be able to establish good moral character. An individual who has been charged with a felony-level check fraud should consult an immigration attorney as well as a criminal defense attorney.

Consequences of Crimes of Dishonesty

An individual convicted of a crime of dishonesty like violating the bad check laws faces consequences beyond the penalties of the county jail or state prison sentence in their criminal case and concerns related to immigration. If they have been convicted of a felony, they may be impeached as a witness in any type of case. Legal cases can range from a child custody case to a workers compensation case.

A bank may also charge the individual for passing a bad check. A conviction for passing a bad check may negatively impact the individual’s credit score. It will also cause the individual’s future applications for credit to be denied.

The bank may also choose not to continue allowing the individual to remain a customer. An individual who has a professional license may face disciplinary action from their licensing board. The individual could lose their job or security clearance.

Civil Remedies for a Bounced Check

A payee may sue a party who wrote a bad check within three years of the date of the fraud. California Civil Code Section 1719 provides that if the payee is successful, they will recover treble damages, or damages for three times the amount of the check, up to $1,500. The procedure for suing an individual who writes an NSF check has several steps.

First, the payee must send a demand letter to the person who wrote the check. They should send the letter by certified mail with a return receipt and keep copies of the letter and receipt.

If the writer of the check does not pay them within 30 days, they can file a civil lawsuit. If the payee is asking for $10,000 or less, they should file in small claims court; if asking for more than $10,000, they should file in the civil division of the superior court. There are different rules for small claims court and superior court.

Proving an NSF Check in Court

The payee should show the judge a copy of the demand letter and the signed certified mail receipt that proves they mailed the letter. They should also show documents related to the case, including a copy of the bad check, bank statements, receipts and letters and emails that contain conversations with the check writer. A payee does not have to prove that the check writer had the intent to defraud them. If the check writer told the bank to stop payment on the check to resolve a good faith dispute, the payee may not be able to recover damages and other costs.

Defense Strategies for Check Fraud Criminal Charges

Legal defenses to check fraud include the consent to make changes to the check, lack of intent to defraud and lack of knowledge that the check was bad. A person accused of bad check charges can demonstrate their lack of intent and lack of knowledge by taking measures to minimize the damage of their actions. Such measures can include compensating the victim for their losses early on or negotiating a settlement to the victim for costs, attorney’s fees and losses caused by the bad check prior to the case being set for trial. A person who argues they had consent to make changes should submit evidence of conversations that relate to consent.