Bad Check Laws In Alabama


Businesses and individuals lose millions of dollars each year in Alabama because a person has written a bad check. A consumer writes a check and does not have the funds in the bank account to cover the expense. In some cases, the bank account might even have been closed. Writing a bad check in the state of Alabama can be both a criminal and civil offense.

State Of Alabama

Types of Bad Checks

There are certain methods that individuals can to write a bad check, so consumers need to find ways to avoid writing bad checks. Customers might write a bad check from a bank account that has been closed. In addition, a check could be signed by someone who is not authorized to sign the check; therefore, the check is bad. A check is also bad if there are not adequate funds in the account to cover the amount of the check.

Criminal Penalties

Writing a check without sufficient funds in the bank is considered fraud and can result in fines and jail time. The criminal offense is regarded as a class A misdemeanor in Alabama. If a person writes a bad check for more than $500, the fine will be between $500 and $5000. Individuals could receive prison time of up to three years. If the check is for less than $500, the penalty will vary, depending on the amount. Individuals can also be guilty of fraud if they endorse a check with the knowledge that it is bad.

Civil Penalties

After writing a check, Alabama individuals have ten days to correct the mistake. Alabama laws give the benefit of doubt to the person writing the check. It is easy to make errors when balancing a checkbook, so individuals have the opportunity to pay the funds without penalty. If the payee does not attempt to cash the check within 30 days, the person writing the check is not liable for insufficient funds. A person should contact the payee and make payment arrangements. If individuals fail to pay the check, the payee will take additional steps, so that they will receive their money.

Collection agencies might be asked to attempt to collect the funds. The payee can also have the check-writers name put on the bad check registry. This can prevent individuals from writing checks in the future.

Determining Guilt

To convict an individual for writing a bad check, the prosecution needs sufficient evidence. In the state of Alabama, the district attorney's office helps payees to recover the funds they lost and any additional fees. The cost in Alabama for processing a bad check is $94, and a return-check fee costs up to $30 plus the amount of the bad check. The district attorney wants to give the individual the chance to resolve this matter, so he will normally set up a repayment plan and arrange credit counseling. If the individual refuses to cooperate, he will be arrested and prosecuted.

Checks that were written for a lease or loan payment are more difficult to recover. Cash advance checks are also more complex to manage. A small claim usually deals with these cases. The district attorney's office cannot help with checks stamped with a forged signature because the police will get involved in these cases.

Receiving a Bad Check

Individuals or businesses have two years to take action against a person who has written a bad check. However, if a cashier's check, certified check or traveler's check has been received, the statute of limitations is three years. Some checks have a due date; therefore, the statue of limitations begins from that date, not the date on the check.

What Consumers need to do about a Bad Check

The state of Alabama will give check writers ample time to rectify the situation, so consumers will have the opportunity to get out of trouble. If a person has written a bad check, he should contact an attorney to get some legal advice. He should not speak to a police officer until he contacts a lawyer. It is important for individuals to not write a check they know is not valid. Writing a bad check will not affect an individuals credit score; however, some banks will deny a person an account. It is important for consumers to balance their checkbooks frequently, so they know how much money they have in their checking account.

If a notice that payment was refused is sent by certified or registered mail and is returned to the sender, the person is believed to have had the intent to pass a bad check. The notice must be sent within a reasonable time after the check was written.

If individuals need more information regarding writing or passing bad checks and for the civil and criminal penalties in other states, they can read the bad check laws. People can also check the state statues for the state of Alabama.

For further information on writing or passing a bad check and for civil and criminal penalties in other states under the laws of issuing bad checks, please read Bad Check Laws

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