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Bad Checks - F.A.Q.s

What damages can I recover in a bad check case? (MAG 50)

You may be able to collect the amount of the check, plus damages of twice the amount of the check, but in no case more than $500.00, plus court costs.

 

What is the deposit account fraud (bad check) statute? (MAG 50)

O.C.G.A. 16-9-20 - Deposit Account Fraud.

  • (a) A person commits the offense of deposit account fraud when such person makes, draws, utters, executes, or delivers an instrument for the payment of money on any bank or other depository in exchange for a present consideration or wages, knowing that it will not be honored by the drawee. For the purposes of this Code section, it is prima-facie evidence that the accused knew that the instrument would not be honored if:
    1. (1)The accused had no account with the drawee at the time the instrument was made, drawn, uttered, or delivered;
    2. (2)Payment was refused by the drawee for lack of funds upon presentation within 30 days after delivery and the accused or someone for him or her shall not have tendered the holder thereof the amount due thereon, together with a service charge, within ten days after receiving written notice that payment was refused upon such instrument. For purposes of this paragraph:
      • (A) Notice mailed by certified or registered mail evidenced by return receipt to the person at the address printed on the instrument or given at the time of issuance shall be deemed sufficient and equivalent to notice having been received as of the date on the return receipt by the person making, drawing, uttering, executing, or delivering the instrument. A single notice as provided in subparagraph (B) of this paragraph shall be sufficient to cover all instruments on which payment was refused and which were delivered within a ten-day period by the accused to a single entity, provided that the form of notice lists and identifies each instrument; and
      • (B) The form of notice shall be substantially as follows:

        "You are hereby notified that the following instrument(s)

        Number Date Amount Name of Bank
        _______________     _______________     _______________     _______________
        _______________     _______________     _______________     _______________
        _______________     _______________     _______________     _______________
        _______________     _______________     _______________     _______________
        _______________     _______________     _______________     _______________
        _______________     _______________     _______________     _______________
        _______________     _______________     _______________     _______________

        drawn upon __________ and payable to __________, (has) (have) been dishonored. Pursuant to Georgia law, you have ten days from receipt of this notice to tender payment of the total amount of the instrument(s) plus the applicable service charge(s) of $_____________, the total amount due being $________ dollars and ____ cents. Unless this amount is paid in full within the specified time above, a presumption in law arises that you delivered the instrument(s) with the intent to defraud and the dishonored instrument(s) and all other available information relating to this incident may be submitted to the magistrate for the issuance of a criminal warrant or citation or to the district attorney or solicitor for criminal prosecution."; or

    3. (3) Notice mailed by certified or registered mail is returned undelivered to the sender when such notice was mailed within 90 days of dishonor to the person at the address printed on the instrument or given by the accused at the time of issuance of the instrument.
  • (b)
    1. (1) Except as provided in paragraphs (2) and (3) of this subsection and subsection (c) of this Code section, a person convicted of the offense of deposit account fraud shall be guilty of a misdemeanor and, upon conviction thereof, shall be punished as follows:
      • (A) When the instrument is for less than $100.00, a fine of not more than $500.00 or imprisonment not to exceed 12 months, or both;
      • (B) When the instrument is for $100.00 or more but less than $300.00, a fine of not more than $1,000.00 or imprisonment not to exceed 12 months, or both; or
      • (C) When more than one instrument is involved and such instruments were drawn within 90 days of one another and each is in an amount less than $100.00, the amounts of such separate instruments may be added together to arrive at and be punishable under subparagraph (B) of this paragraph.
    2. (2) Except as provided in paragraph (3) of this subsection and subsection (c) of this Code section, a person convicted of the offense of deposit account fraud, when the instrument is for an amount of not less than $300.00 nor more than $499.99, shall be guilty of a misdemeanor of a high and aggravated nature. When more than one instrument is involved and such instruments were given to the same entity within a 15 day period and the cumulative total of such instruments is not less than $300.00 nor more than $499.99, the person drawing and giving such instruments shall upon conviction be guilty of a misdemeanor of a high and aggravated nature.
    3. (3) Except as provided in subsection (c) of this Code section, a person convicted of the offense of deposit account fraud, when the instrument is for $500.00 or more, shall be guilty of a felony and, upon conviction thereof, shall be punished by a fine of not less than $500.00 nor more than $5,000.00 or by imprisonment for not more than three years, or both.
    4. (4) Upon conviction of a first or any subsequent offense under this subsection or subsection (c) of this Code section, in addition to any other punishment provided by this Code section, the defendant shall be required to make restitution of the amount of the instrument, together with all costs of bringing a complaint under this Code section. Costs shall be determined by the court from competent evidence of costs provided by the party causing the criminal warrant or citation to issue; provided, however, that the minimum costs shall not be less than $25.00. Restitution may be made while the defendant is serving a probated or suspended sentence.
  • (c) A person who commits the offense of deposit account fraud by the making, drawing, uttering, executing, or delivering of an instrument on a bank of another state shall be guilty of a felony and, upon conviction thereof, shall be punished by imprisonment for not less than one nor more than five years or by a fine in an amount of up to $1,000.00, or both.
  • (d) The prosecuting authority of the court with jurisdiction over a violation of subsection (c) of this Code section may seek extradition for criminal prosecution of any person not within this state who flees the state to avoid prosecution under this Code section.
  • (e) In any prosecution or action under this Code section, an instrument for which the information required in this subsection is available at the time of issuance shall constitute prima-facie evidence of the identity of the party issuing or executing the instrument and that the person was a party authorized to draw upon the named account. To establish this prima-facie evidence, the following information regarding the identity of the party presenting the instrument shall be obtained by the party receiving such instrument: the full name, residence address, and home phone number.
    1. (1) Such information may be provided by either of two methods:
      • (A) The information may be recorded upon the instrument itself; or
      • (B) The number of a check-cashing identification card issued by the receiving party may be recorded on the instrument. The check-cashing identification card shall be issued only after the information required in this subsection has been placed on file by the receiving party.
    2. (2) In addition to the information required in this subsection, the party receiving an instrument shall witness the signature or endorsement of the party presenting such instrument and as evidence of such the receiving party shall initial the instrument.
  • (f) As used in this Code section, the term:
    1. (1) "Bank" shall include a financial institution as defined in paragraph (21) of Code Section 7-1-4.
    2. (2) "Conviction" shall include the entering of a guilty plea, the entering of a plea of nolo contendere, or the forfeiting of bail.
    3. (3) "Financial institution" shall have the same meaning as defined in paragraph (21) of Code Section 7-1-4.
    4. (4) "Instrument" means a check, draft, debit card sales draft, or order for the payment of money.
    5. (5) "Present consideration" shall include without limitation:
      • (A) An obligation or debt of rent which is past due or presently due;
      • (B) An obligation or debt of state taxes which is past due or presently due;
      • (C) An obligation or debt which is past due or presently due for child support when made to the custodian of a minor child for the support of such minor child and which is given pursuant to an order of court or written agreement signed by the person making the payment;
      • (D) A simultaneous agreement for the extension of additional credit where additional credit is being denied; and
      • (E) A written waiver of mechanic's or materialmen's lien rights.
    6. (6) "State taxes" shall include payments made to the Georgia Department of Labor as required by Chapter 8 of Title 34.
  • (g) This Code section shall in no way affect the authority of a sentencing judge to provide for a sentence to be served on weekends or during the nonworking hours of the defendant as provided in Code Section 17-10-3.
  • (h)
    1. (1) Any party holding a worthless instrument and giving notice in substantially similar form to that provided in subparagraph (a)(2)(B) of this Code section shall be immune from civil liability for the giving of such notice and for proceeding as required under the forms of such notice; provided, however, that, if any person shall be arrested or prosecuted for violation of this Code section and payment of any instrument shall have been refused because the maker or drawer had no account with the bank or other depository on which such instrument was drawn, the one causing the arrest or prosecution shall be deemed to have acted with reasonable or probable cause even though he, she, or it has not mailed the written notice or waited for the ten-day period to elapse. In any civil action for damages which may be brought by the person who made, drew, uttered, executed, or delivered such instrument, no evidence of statements or representations as to the status of the instrument involved or of any collateral agreement with reference to the instrument shall be admissible unless such statements, representations, or collateral agreement shall be written simultaneously with or upon the instrument at the time it is delivered by the maker thereof.
    2. (2) Except as otherwise provided by law, any party who holds a worthless instrument, who complies with the requirements of subsection (a) of this Code section, and who causes a criminal warrant or citation to be issued shall not forfeit his or her right to continue or pursue civil remedies authorized by law for the collection of the worthless instrument. It shall be deemed conclusive evidence that any action is brought upon probable cause and without malice where such party holding a worthless instrument has complied with the provisions of subsection (a) of this Code section regardless of whether the criminal charges are dismissed by a court due to payment in full of the face value of the instrument and applicable service charges subsequent to the date that affidavit for the warrant or citation is made. In any civil action for damages which may be brought by the person who made, drew, uttered, executed, or delivered such instrument, no evidence of statements or representations as to the status of the instrument involved or of any collateral agreement with reference to the instrument shall be admissible unless such statements, representations, or collateral agreement shall be written simultaneously with or upon the instrument at the time it is delivered by the maker thereof.
  • (i) Notwithstanding paragraph (2) of subsection (a) of this Code section or any other law on usury, charges, or fees on loans or credit extensions, any lender of money or extender of other credit who receives an instrument drawn on a bank or other depository institution given by any person in full or partial repayment of a loan, installment payment, or other extension of credit may, if such instrument is not paid or is dishonored by such institution, charge and collect from the borrower or person to whom the credit was extended a bad instrument charge. This charge shall not be deemed interest or a finance or other charge made as an incident to or as a condition to the granting of the loan or other extension of credit and shall not be included in determining the limit on charges which may be made in connection with the loan or extension of credit or any other law of this state.
  • (j) For purposes of this Code section, no service charge or bad instrument charge shall exceed $25.00 or 5% (percent) of the face amount of the instrument, whichever is greater.
  • (k) An action under this Code section may be prosecuted by the party initially receiving a worthless instrument or by any subsequent holder in due course of any such worthless instrument.

 

What if I do not get the money after sending the letter? (MAG 50)

The maker of the check has ten days from receipt of the letter to tender payment, in cash, of the amount of the check plus service charges. Failure of the maker of the check to pay the above sum will entitle you to proceed with an action for statutory damages.

 

What is meant by present consideration? (MAG 50)

The check must have been tendered for either wages or present consideration. The offense of Deposit Account Fraud is analogous to a theft of the item or services received through the fraudulent presentation of worthless paper when immediate payment is expected. Anything that temporally separates the exchange will negate the concept of present consideration.

Present consideration includes:

  • Goods or services tendered for check.
  • Rent which is past due or presently due.
  • Child support, pursuant to court order or written agreement.
  • State taxes, whether or not past due.
  • Simultaneous agreement for the extension of additional credit where additional credit is being denied.
  • A written waiver of mechanic's or materialmen's lien rights.

Present consideration does not include:

  • Post-dated check.
  • Payment on an installment account or on an open account for goods/services previously received.
  • Request by Defendant to Victim to hold check, expects to deposit soon to cover balance.

 

Where are deposit account fraud cases tried? (MAG 50)

Cases prosecuted by warrant are tried in the State Court if the offense is a misdemeanor or in the Superior Court if the case is a felony.

 

Where should the offense of deposit account fraud be prosecuted? (MAG 50)

The proper venue for the prosecution of the offense of Deposit Account Fraud is the County in which the check was presented. This is true regardless of where your home office may be located or where the person who tendered the check resides.

 

What are the elements of the offense of deposit account fraud? (MAG 50)

  • Dishonor of the Check - the check must be dishonored by the drawee for one of the reasons set forth in the statute.
  • Knowledge by the maker of the check that it would not be honored.
  • Present Consideration - the check must have been given for present consideration.

 

What steps should be taken to insure a bad check can be collected? (MAG 50)

  • Be sure clerks have followed all items on this checklist.
  • Keep permanent record of home address of clerk who actually received check. This person will be an absolutely critical witness who must identify the person who made the check if the case goes to trial.
  • Deposit all checks within thirty (30) days of receipt.
  • Within ninety (90) days of receipt of check, mail certified demand letter to address given by maker of check. Give maker of check at least ten (10) days and three (3) for mailing before prosecuting criminally. You need not wait for actual receipt of notice. Try to telephone accused and keep record of your efforts.
  • Is this check actually one for present consideration?
  • Are there any defenses, including, but not limited to: post-dating, stop payment, payment antecedent debt, prior dealings, agreement to hold check, forgery, refer to maker?
  • Has management received part payment? If so, proceed civil remedy only.
  • Make photocopies of check (front and back), ten (10) day demand letter, certified mail notice, and/or envelope mailed to maker if return unclaimed.
  • Proceed criminally for all checks that meet checklist in the county where the check was passed.
  • Proceed civilly against all other checks. (Magistrate Court, if $15,000.00 or less) in the county where the Defendant lives.
  • Filing fee $10.00. Court fees and fines - $50 and up

 

What should my letter say? (MAG 50)

The statute sets forth a form letter that you may use. If you use another letter, it must substantially comply with the statutory form as set forth below:



Date: _____________________ To: _______________________
Address: ___________________________________________
City: _______________ State: ______________ Zip: ________________

You are hereby notified that a check or instrument numbered ________, issued by you on _______________ (Date), drawn upon ________________________________________(Name of Bank), and payable to _________________________________________________, has been dishonored. Pursuant to Georgia law, you have ten days from receipt of this notice to tender payment of the full amount of the check or instrument plus a service charge of $25.00 or 5% (percent) of the face amount of the check or instrument, whichever is greater, the total amount due being $ _______________. Unless this amount is paid in full within the ten-day period, the holder of the check or instrument may file a civil suit against you for two times the amount of the check or instrument, but in no case more than $500, in addition to the payment of the check or instrument plus any court costs incurred by the payee in taking the action.


Name of Sender: ___________________________________________________
Address: ___________________________________________________
City: _____________________ State: _________________ Zip: _____________
TelePhone: ___________________________________________________

 

What is a bad check arrest warrant? (MAG 50)

An arrest warrant is an order of the court directing any duly authorized law enforcement official to arrest the person named in the warrant for the offense charged (in this case the offense of Deposit Account Fraud). The accused will be arrested and, in most instances, allowed to post bond to secure the accused's appearance at trial.

 

Can I pursue criminal prosecution of a bad check? (MAG 50)

Whether the issuance of a bad check is a crime will depend on several factors. You should review these factors carefully against the particular facts in your case before applying for a warrant. The elements of the criminal offense of Deposit Account Fraud (Bad Check) are contained in O.C.G.A. 16-9-20.

 

What information should I bring to court to start a bad check prosecution? (MAG 50)

You should bring with you the original check, a copy of the check (front and back), the certified mail receipt or returned letter if unclaimed, and any notes you have kept related to your efforts to collect the check.

 

What defenses may be raised to bad check prosecution? (MAG 50)

  • Post-dated check - a check with a date after the date on which the check was presented is considered a post-dated check and may not be prosecuted criminally. The post-dating of the check creates an extension of credit, even if only for a day, and converts the case to a bad debt situation.
  • Stopped payment on a check - a check which was dishonored because payment was stopped, and not because of insufficient funds, may not be prosecuted criminally.
  • Payment of antecedent debt - a check which represents payment of an antecedent debt (e.g. - repayment of a loan or payment on an account) may not be prosecuted criminally.
  • Statement by the maker of the check at the time of tender that he has insufficient money in bank to cover the check, though he expects to have the money in the bank by the time the check is presented. In effect, the payee has agreed to extend credit and there is no present consideration.
  • Prior dealings of the parties.
  • Insanity: i. Inability to distinguish right from wrong ii. Intoxication a. must be involuntary b. voluntary intoxication is no defense
  • Forgery - a check which is forged (made by someone otherthan the account holder and without the account holder's consent) may not be prosecuted as a bad check. It therefore vital that the payee confirm the identity of the maker of the check at the time the check is presented.
  • Lack of knowledge that check would not be honored (for example, the maker of the check did not know that someone else had withdrawn funds from the account); and
  • Good character of defendant.

 

What reasons for dishonor of the check will support a criminal prosecution? (MAG 50)

The check must be dishonored by the drawee for one of two reasons:

  1. No account / Account closed - this is based on the status of the account at the time the check was made, drawn, uttered, or delivered, not at the time it was presented to the bank for payment.
  2. Lack of funds - the check must have been deposited or presented for payment within thirty (30) days of the date of delivered, and the accused has failed to make payment of the check and a service charge within ten (10) days after receiving written notice that the check has been dishonored.

A copy of the notice that will satisfy this requirement may be found in these materials. There are many other reasons why a check may not be paid upon presentation. However, only the reasons set forth in the statute will support a criminal prosecution. If the check has been dishonored for another reason you should review the availability of civil remedies for bad checks contained in this file.

 

I have received a bad check, so what can I do? (MAG 50)

The issuance of a check on an account which is closed or has insufficient funds may constitute a crime for which the maker of the check may be prosecuted. The issuance of a check which is not honored may also give rise to a civil claim for damages. Which way you proceed in your case will depend on the circumstances in your case.

 

What is the form of the notice that must be sent? (MAG 50)

The form of the notice should be as set forth as follows:



Date: ________________________ To: _______________
Address: _________________________________________________________
City: ________________________ State: ___________ Zip: ____________

Number Date Amount Name of Bank
_______________     _______________     _______________     _________________
_______________     _______________     _______________     _________________
_______________     _______________     _______________     _________________
_______________     _______________     _______________     _________________
_______________     _______________     _______________     _________________
_______________     _______________     _______________     _________________
_______________     _______________     _______________     _________________

drawn upon __________ and payable to __________, (has) (have) been dishonored. Pursuant to Georgia law, you have ten days from receipt of this notice to tender payment of the total amount of the instrument(s) plus the applicable service charge(s) of $_____________, the total amount due being $________ dollars and ____ cents. Unless this amount is paid in full within the specified time above, a presumption in law arises that you delivered the instrument(s) with the intent to defraud and the dishonored instrument(s) and all other available information relating to this incident may be submitted to the magistrate for the issuance of a criminal warrant or citation or to the district attorney or solicitor for criminal prosecution."; or


Name of Sender: _____________________________________________________
Address: _____________________________________________________
City: _________________ State: ______________ Zip: ______________
TelePhone: _____________________________________________________

 

 

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