Table of Contents:
- Law on Writing Bad Checks in Michigan
- Tennessee Laws on Writing Bad Checks
- Kentucky Bad Check Law
- About Oklahoma Bad Check Laws
- Texas Bad Check Laws
- Indiana Bad Check Law
- Bad Check Laws in Georgia
- Bad Check Laws in Alabama
- Bad Check Laws in Ohio
Under Section 750.131/mileg.aspx?page=getObject&objectName=mcl-750-131) of Michigan law, presenting a check or bank draft is illegal when you know that sufficient funds don't exist to cover the payment. Writing checks on closed or nonexistent accounts is also illegal. The penalties depend on the check amounts, how many you write and whether the recipient pursues civil action to recover his loss.
Checks of $100 or Less
Writing bad checks of $100 or less is a misdemeanor punishable by a $500 maximum fine and 93 days of county jail time, or both. For one or more prior convictions, the offense is still classified in Section 750.131 as a misdemeanor, but the maximum fine and jail time increase to $1,000 and one year, respectively.
Checks of $100 to $499
Penalties for bad checks of $100 to $499 depend on criteria outlined in Section 750.131. A first or second offense is a misdemeanor punishable by up to a year of county jail time. A judge could also order you to pay a $1,000 maximum fine or three times the check amount, whichever is greater. The charge is a felony for offenders with two or more convictions. In that case, you can expect a $2,000 maximum fine and up to two years in prison. However, prior bad check convictions aren't counted for sentencing purposes.
Checks of $500 or More
Bad check amounts of $500 or more are felonies that mandate a two-year minimum person term, according to Section 750.131. You could also be fined up to $2,000 or three times the check amount, whichever is greater. A prosecutor can also pursue felony charges if you pass three or more bad checks in 10 days or you write checks at a bank where you don't have an account. Offenders face up to two years in prison, a $500 maximum fine or both. A prosecutor may also seek an enhanced sentence, based on one or more prior convictions, which requires a separate hearing before a judge.
Section 600.2952 of the Michigan Penal Code allows bad check recipients to seek civil damages and costs. The process starts with a notice requesting full payment within five to seven days, plus a $25 processing fee. If you don't pay within 30 days, the fee is $35. Failure to respond allows the check holder to file a civil suit against you. If the victim wins, you become liable for the full check amount, plus $250 in costs. You may also have to pay civil damages of up to twice the check amount, or $100, whichever is greater.
Bad Check Defenses
Two basic options exist for fighting a bad check charge. You can argue that you didn't intend to write a bad check, because you really believed the money was in your account, asserts Michigan criminal defense attorney David J. Kramer. The prosecutor must prove otherwise. You can also try striking a deal -- such as making restitution on a payment plan -- in exchange for the recipient dropping the charges.
Bad Check Recovery Units
Many Michigan counties offer Bad Check Recovery Units for victims who don't want to deal with the court system. Eligibility depends on each unit's specific guidelines. For example, the Calhoun County Bad Check Recovery/Diversion Program won't accept checks that a financial institution didn't process or checks that lack an amount, date or signature. If a case meets the criteria, the unit's office may propose to have you settle it by paying the check amount. This approach helps you avoid a criminal record and spares the check holder a lengthy collection effort.
Tennessee law provides strict criminal and civil consequences for writing bad checks. People who write checks knowing that there are insufficient funds in their accounts may be liable for up to three times the amount of the check. In Tennessee, people can be charged with a felony if the check is over the statutory limit.
According to the statute, fraudulent intent is inferred if the person no longer had an account with the bank at the time he wrote the check or if he received notice of the bad check and did not pay off the check within 10 days of receiving this notice.
Writing a worthless check is considered a crime of theft in Tennessee. If the check is worth $500 or less, it is considered a Class A misdemeanor. It is a felony to write a worthless check for more than $500.
The bad check recipient has to notify the person who wrote the check of its dishonor. The bad check writer has 10 days to make good on the check without facing any criminal consequences. After 10 days have passed, the bad check recipient can contact the Hot Check Unit operated by his county's district attorney's office. This unit can file charges against the bad check writer and pursue restitution to get back the money owed to the check's recipient.
Under Tennessee law, a person who is sued for a dishonored check can be ordered to pay the full amount of the check, 10 percent annual interest on the face amount of the check, a reasonable service charge, court costs and attorney fees. Additionally, if the court finds fraudulent intent, the person who wrote the check can be ordered to pay three times the amount of the check, up to $500.
A person can avoid these consequences by paying the person to whom he gave the check the full amount of the check within 10 days of receiving notice that it was not honored at the bank.
Under Tennessee law, a person can only choose to pursue a hot check through criminal or civil law, but not both.
Laws in the Commonwealth of Kentucky treat all bad checks, also known in Kentucky as cold checks, as a misdemeanor or felony “theft by deception” offense. As of publication date, there are no civil penalties, so a conviction could involve a jail or prison sentence. Statute 514.040 outlines the legal consequences and penalties for committing “theft by deception.”
Checks that Qualify as Cold
The intent of a check writer determines whether a returned check is a prosecutable offense. Checks that qualify as intentionally written to deceive are:
- Checks written on a closed or non-existent account
- Checks written against insufficient funds and not paid in full -- including any additional penalties or fees imposed by the recipient and the bank -- within 10 business days
- Checks that display incorrect bank information and therefore are returned as unable to locate
Misdemeanor vs. Felony Offense
The cutoff point between whether the County Attorney’s Office considers a cold check a Class A misdemeanor or prosecutes it as a Class D or Class C felony offense is $500. The circumstances of the case and any prior criminal history determine whether a judge will impose the maximum sentence or a lesser penalty.
- A check written for up to $499.99 is a misdemeanor offense. Conviction is punishable by a jail sentence ranging from 90 days to one year and a fine of up to $500.
- A check written for $500 to $9,999.99 or more is a Class D felony. In addition to a possible prison sentence of 1 to 5 years, the penalty fine ranges from $1,000 to $10,000
- A check written for $10,000 or more is a Class C felony. In addition to a possible prison sentence of 5 to 10 years, the penalty fine ranges from $1,000 to $10,000.
Not everyone writes a bad check -- what Oklahoma statutes call bogus checks -- with the intention of committing fraud. For example, a check you deposited in your account may not have cleared yet, leaving less available funds in your account than you thought when you wrote your rent check. However, Oklahoma law assumes the worst about your intentions. As a result, if you write a check that fails to clear, you have a limited period of time under Oklahoma law to make things right. Otherwise, the person or company to whom you remitted the check can go to the authorities.
The Role of the District Attorney
You have five days from the date your check is returned for insufficient funds to reach out to the payee and make good on it. Otherwise, the payee can turn the bad check over to the District Attorney’s office, along with an affidavit stating the facts of the case. The law takes it for granted that you intended to defraud the payee and wrote the check without intending to pay for the services or merchandise. This is the case even if something went wrong with your bank account and you acted unknowingly. Oklahoma law expects you to monitor your own account to ensure that everything is as it’s supposed to be and adequate funds are there to cover the check you’re writing.
The Bogus Check Restitution Program
Oklahoma instituted its Bogus Check Restitution Program in 1983 as an alternative to criminal charges – it’s up to the DA's office which way it wants to proceed. Under the program, the DA’s Bogus Check Division is authorized to collect the check’s amount from you, plus any bank fees incurred by the payee and an additional $25. If the check was written for a large amount, you may be able to enter into a binding agreement to pay it in installments.
If you write any subsequent bad checks after your first one, your restitution agreement is revoked and you’ll face criminal charges. Judges commonly order restitution as part of criminal convictions as well.
If the DA presses charges against you, penalties depend on how much the check was for. If it was $500 or less, the charge is a misdemeanor, punishable by up to a year in jail and a $1,000 fine. If the check was written for an amount between $500 to $999.99, it’s a felony – you risk the same year in jail, but the fine jumps to $5,000. Bogus checks written for $1,000 or more can lead to 10 years in prison. This amount applies to the aggregate total of checks passed. If you write 10 checks for $100, you’re subject to this far stiffer penalty, not a series of 10 misdemeanor charges.
The Texas Penal Code addresses bad checks – more commonly referred to in Texas as hot checks – in two different sections. Which section a worthless checks fits into, as well as the potential legal consequences, depends on the amount of the check and the intent of the writer. In most cases, a hot check is a misdemeanor offense, but the writer risks felony charges in some situations.
Bad Check vs. Theft by Check
Sections 32.41 and 31.02 distinguish between two hot check classifications:
- Penal Code 32.41 addresses the “issuance of a bad check.” It defines a bad check as one knowingly written against insufficient funds.
- Penal Code 31.02 addresses "theft by check" infractions. It defines a theft by check situation as one written against a non-existent bank account, or a bad check not paid in full within a specific time.
Legal Requirements for Filing Charges
The recipient must send the writer a demand for payment letter, then give the writer 10 days to pay the amount and any associated collection fees in full before filing charges for a check written against insufficient funds. This same rule applies if the writer stops payment on the check.
There is no waiting period for filing charges against a person who writes a check against a non-existent bank account, but the recipient must file charges with the District Attorney or Justice of the Peace office within 30 days of receiving the check.
Check writers who either make a partial payment without having a mutually agreed upon payment plan or who file bankruptcy still can face prosecution.
Potential Legal Consequences
The amount of a single bad check or the total of multiple checks, not the type of charge, determines the potential legal consequences. Consequences range from a Class C misdemeanor to a first class felony.
- The offense is a Class C misdemeanor for a bad check under $20. The penalty for a Class C misdemeanor is a fine of up to $500.
- The offense is a Class B misdemeanor for checks under $20 if they're written to pay child support, and for other checks between $20 and $500. The penalty for a Class B misdemeanor is a fine of up to $2,000 and/or up to 180 days in a county jail.
- The offense is a Class A misdemeanor for a check between $500 and $1,500. The penalty for a Class A misdemeanor is a fine of up to $4,000 and/or up to one year in a county jail.
A bad check for more than $1,500 is a felony offense. Depending on the amount, charges range from a state jail felony to first degree felony:
- A check of at least $1,500 but less than $20,000 is a state jail felony.
- A check of at least $20,000 but less than $100,000 is a third degree felony.
- A check of at least $100,000 but less than $200,000 is a second degree felony.
- A check for $200,000 or more is a first degree felony.
Felony penalties include a fine of up to $10,000, and – except for a state jail felony charge – time spent in a state prison. A state felony charge carries the potential for 180 days to two years in a state jail, and a fine of up to $10,000.
If you present a check for an amount under $2,500, you will be guilty of a Class A misdemeanor. According to Indiana criminal statutes, a Class A misdemeanor carries carries a potential sentence of up to a year in county jail and a maximum fine of $5,000.
If the amount of the worthless check is $2,500 or more and the property received includes an automobile, the charge will be amended up to a Class D felony. Class D felonies carry a potential sentence of six months to three years in jail (or prison if the sentence is over a year) and fines up to $10,000. In some counties, the threshold for charging a felony is lower. For example, in Tippecanoe County, prosecutors have the authority to charge a felony for worthless checks of $500 or more.
Indiana law also allows victims to sue an offender for civil damages. Under the law, a victim can claim damages up to three times the amount of the check for a maximum of $500 per check, attorney fees and 18 percent annual interest.
Several Indiana counties, including Boone, Warren, Tippecanoe and Noble, offer certain first-time worthless-check offenders the opportunity to avoid prosecution and jail by participating in a bad check diversion program. Under the terms of these programs, an offender is allowed a set amount of time to pay a victim the full amount of the check (plus any fees set forth by the particular county) and take part in a worthless-check prevention class.
Indiana law allows the writer of a worthless check to ask that a charge of check deception be dismissed if, within 10 days of receiving notice that the check presented was not paid, the check writer pays the full amount of the check and fees as set out in the law. Similarly, a charge of check deception cannot be filed if the presenter of the worthless check did not know he had insufficient funds to cover the check or the person who accepted the check knew the presenter did not have sufficient funds to cover the check.
Someone who knowingly writes checks without sufficient funds or from a closed or fake account commits deposit account fraud under Section 16-9-20 of Georgia's criminal code. Penalties depend on the amount of the check and the offender's status. If a prosecutor doesn't file charges, victims still can pursue civil suits to recoup the loss.
Basic Legal Elements
To file a complaint under Section 16-9-20, a prosecutor must show the offender knew that the bank wouldn't honor the check because he lacked the funds to cover it, wrote it on a closed account, or didn't have an account with the institution. He also must prove the offender wrote the check for present consideration, or immediate payment of the goods and services that he fraudulently obtained.
Georgia law specifies three kinds of misdemeanors. Writing a bad check for $100 or less is punishable by a maximum $500 fine, one-year prison term, or both. Checks of $100 to $300 result in a $1,000 maximum fine, one-year prison term, or both. If the amount is $300 to $499, an offender is guilty of a high and aggravated misdemeanor. Penalties may include a fine of up to $5,000 and one-year prison term.
Bad checks of $500 or more are felonies, punishable by fines of $500 to $5,000 and a maximum three-year prison term under Section 16-9-20. Writing bad checks against banks in another state also is a felony. A conviction results in fines of $1,000 to $5,000, and a 1 to 5 year prison sentence. As in misdemeanor cases, a judge also may order restitution and payment of court costs.
Victims may seek additional damages of twice the original check's face value. The maximum amount remains $500, however. The process requires sending a demand letter by certified mail. The suspect is given 10 days to pay the amount owed and service charges of $30 or five percent, whichever is higher. If he doesn't respond, the victim can seek an arrest warrant or sue to collect the amount.
Bad Check Citations
Some jurisdictions, like Cherokee County, offer bad check citation programs to spare victims and offenders a lengthy court process. Only misdemeanor cases qualify. The offender must appear by the date specified on his citation to demand a trial or avoid prosecution by making the check good. If he doesn't appear, the court issues a warrant for his arrest.
Alabama’s civil punishment is the “greater of $10 or actual bank charges.” Alabama allows 10 days for an insufficient funds check to be honored after written notice to the drawer of the dishonored check was sent. During those 10 days, the drawer of the check has to contact the payee with arrangement for repayment. Failure to do so can lead to more aggressive collection activity on behalf of the payee. Collection agencies can be employed to collect the amount due and the bank charges. The payee also has the right to contact check clearing agencies listing the check-writer's name on a bad check registry. Having one's name on the registry can restrict the ability to use a check for payment.
The act of writing a check with non-sufficient funds is considered an act of fraud punishable by fines and jail time. In Alabama, the bad check law sets the penalty for a “check of $500 or more, fine of not less than $500 nor more than $5,000 or imprisonment up to 3 years, or both.\" For a bad check under $500, the fine depends on the amount and the offense.
If a person endorses a check with the knowledge that it is bad, he can also be found guilty of fraud.
Evidence is always available to convict a person who has passed a bad check. Claiming an accounting error or claiming the bank held onto a deposit longer than it should have, is not a valid reason for writing a check without having adequate funds to cover the amount of the check.
Assistance from the District Attorney
In Alabama, county district attorney’s offices work on behalf of the victim to recover the amount of the check and any fees that are a result of the bad check. It is costly to write a bad check. The district attorney's fee for processing a bad check is $94, the cost is up to $28 for a return-check fee, plus the cost of the dishonored check.
There are checks that cannot be recovered with the district attorney’s help: checks that cover lease or loan payments and cash advance checks. A small claim is the avenue in which to pursue repayment for these checks. If the check is stamped with stop payment, forged, irregular signature, frozen funds or frozen account from the bank, the district attorney’s office cannot help with collection. Checks stamped with a forged or an irregular signature should be handed over to the police or sheriff’s departments for investigation. Generally, the district attorney’s offices take the approach that the person writing the check wants to make good on it. The offices usually will set up a repayment plan and offer counseling. The team from the district attorney’s office will also perform skip tracing tasks, arresting and prosecuting any person who chooses to avoid reimbursing the bad check.
Take Care Quickly
It is in a person's best interest to contact the business or individual that received the bad check immediately upon notice of the check being returned. Making arrangements to quickly reimburse the amount of the check and any fees that have been assessed to the check can help avoid prosecution.
Those who pass a bad check in Ohio for less than $500 will be charged with a misdemeanor. The misdemeanor carries a $1,000 fine, and is punishable with up to six months jail time. The jail time may not be presumed necessary, but depending on the judge, it may be mandatory. This conviction will stay on the defendant's criminal record, and could prevent them from opening a checking account in the future.
Anyone who writes a bad check for more than $500 in Ohio could be charged with a fifth-degree felony. The felony carries a $2,500 fine and a possible sentence of five years in prison. Unlike a misdemeanor, this charge will remain on the defendant's criminal record, and could not only prevent them from opening a checking account, but also from getting a job in the near future. For instance, those individuals who work around money will have to pass a criminal background check, and passing bad checks will not be tolerated, because it constitutes fraud.
Necessary Prison Time
Passing bad checks in Ohio for more than $5,000, but less than $100,000 is considered a fourth-degree felony. Fourth-degree felonies may not require jail time, but a definite fine is imposed. Those who pass bad checks for more than $100,000 will be charged with a third-degree felony, and jail time of up to eight years in prison plus a fine will be imposed. The conviction will stay on the permanent record of the convict, and aside from the fine and jail time, restitution will have to be made to the people, organization or business the check or checks were written to.
When a creditor or business goes to recover money from someone who paid them with a bad check, they may obtain up to three times the original amount. The creditor may also collect any fees or bank charges they accrued, in addition to the original amount. The law allows the creditors to request payment from the person who wrote a dishonored check, if the person has not repaid or made resolution to the check within 30 days of the date it was written. The law requires a written notice be sent to the person who wrote the bad check; if they chose to ignore the notice, legal action can be taken.
The law in Ohio does not allow the creditor or business to take legal action after they have set up payment arrangements with the person who wrote the bad check, as long as the person is abiding by the arrangements. However, if the person who wrote the bad check misses one payment, or pays a different amount than agreed to, the creditor and business may seek legal action. Once the amount and any fees agreed to have been paid, the creditor may not file any legal actions against the person.