Worthless Checks – What can happen??

Worthless checks – what can happen if you write a bad check?

Intentionally writing a worthless check is a crime.  In all states, if you write a check, knowing there are insufficient funds or credit behind the check, you may be guilty of a crime and subject to civil and criminal penalties.

In Wisconsin:

It is a Class A misdemeanor if the check is written for less than $2,500.

It is a Class I felony if the check is for more than $2,500 or within 15 days you write more than one check where the total amount is more than $2,500.

Writing a worthless check can be considered intentional when:

*  There is proof that, at the time of issuance, that you did not have an account with the financial institution.

*  There is proof that you did not have sufficient funds or credit with the financial institution and that you failed, within 5 days after receiving notice of nonpayment, to pay the check.

In certain situations, a person who receives a worthless check can hold the writer of the check liable for additional damages.  The payee may bring a civil action and if a Judgment is awarded the court may award:

–        the face value of the check

–        Any actual damages

–        Exemplary damages of not more than 3 times the amount of the check

–        Court costs and reasonable attorney fees – can’t exceed $500

Before a lawsuit can be filed the plaintiff (the person to whom the check was written out) must provide notice to the defendant (you) at least 20 days prior to starting the legal action, or of their intent to bring legal action.  The notice can be sent by regular mail.

It is necessary to file a complaint with the district attorney’s office to initiate criminal legal action.

Although mistakes can happen, it is dangerous to knowingly write bad checks.  To avoid mistakes do the following:

  1. Balance your check book after every entry
  2. Keep track of any ATM slips until you enter them in your register.
  3. Balance your check book to the monthly bank statement, every month!
  4. Remember that the balance that if you call your bank for a balance of your account, or visit their internet site, the balance that you will receive is not necessarily the amount of money you have in your account to spend.  Your balance will not reflect the checks that you have written but have not yet cleared the bank.

If you find that you consistently have problems with your check book, it may be time to switch to a savings account instead.  You can have your paycheck directly deposited into a savings account.  You can have payments automatically deducted from a savings account.  You may even have the ability to use an ATM card from your savings.  One great thing with a savings account is that you can not overdraw it.  What you see is what you get, unlike a checking account.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: