Every collections lawyer receives calls from business and individuals who have deposited bad checks. Grocery stores, auto shops, land landlords and all types of businesses are exposed to the risk of receiving dishonored checks if they accept this form of payment. Some companies have stopped taking checks for this reason, and many others verify the customer’s ID before they will accept a check.
What Is a Dishonored Check?
Occasionally, people write bad checks thinking that they have enough money or expecting a deposit to show in the account before the transaction is processed. However, criminals sometimes intentionally write dishonored checks to avoid paying a debt. This is fraud. Checks may be returned to the payee if there were nonsufficient funds (NSF) or if the check was written from a closed account. If the check is dishonored, the bank will send it back to you. This is commonly called a “bounced” check.
What Can I Do If I Received a Bad Check?
If a bounced check has been returned to you in the mail, the next step is to send a demand letter. A collection lawyer can send an official document via certified mail. You must allow at least 10 days for a response plus three mailing days before your proceed with legal action. The statute of limitations for filing a civil lawsuit varies by state. In New Jersey, you have 10 years from the date when the check was written or three years from the date that the check bounced. Different deadlines apply in other states. There are additional limitations if you are filing criminal charges for check fraud.
Can I Recover Money from the Person Who Wrote the Check?
Legal action is the most effective way to recover the full sum of a debt along with your collection expenses. Your lawyer should request damages for the value of the check, attorney’s fees, court costs and postage for mailing the certified demand. You may be eligible to receive $500 in damages or a sum worth three times the value of the check. If your case is successful, the court will award you the greater amount.
Contact a Debt Collections Lawyer
Dishonored checks cost American businesses $19 billion annually. Many of these losses can be recovered in court. To speak with an experienced collection lawyer at Snellings Law LLC, call us at 973-265-6100.