Cust wrote bad check..bus prob

Discussion in 'Credit Talk' started by Dani, Oct 19, 2001.

  1. Dani

    Dani Well-Known Member

    Hi. As everyone probably knows I'm an accountant for a small business in VA. I have never dealt with the problem below and did not know what to do about it. Hoping everyone can offer me some advice.

    We have a customer who was on a net 30 account. It took her eight months to pay one invoice. I did not send her to collections because I felt I could work out a payment program with her and our company could retreive our money for work performed. After many phone calls, letters, and a payment agreement she paid off the account. As of December 2000, I put her account on a COD basis. She placed two service calls at the beginning of this year and both were paid via check, COD basis. She placed another call in June and the check bounced. I contacted her about this and she said her bank messed up and she would send me a good check. This was in July. She also, wanted to place another service call. I told her no because the newest check had not cleared and she had not made good on it.
    I sent her a letter in September stating please pay us along with the returned check charges. Did not hear from her in 30 days. I called again and told her we need to deal with this situation. She said she didn't have the money and since I would not place the service call she asked for in July she felt she was being treated very shoddy. I told her, you have got to understand I cannot place a service call for a customer who has not made good on their payments. She then said she wasn't paying and hung up.
    I have given her four months to make good on this check. I believe I have been more than leinent. My only other alterative is to place a warrant against her for writing a bad check. I don't even know how to do this. We've always had good paying customers and if their accounts were behind I always worked out a payment plan with them. I have never even sent anyone to collections. Any ideas? Thanks in advance.

  2. KHM

    KHM Well-Known Member

    Try small claims court. Especially if you still have the bounced check to prove it.
  3. Dani

    Dani Well-Known Member

    I don't have the bounced check. When you put it through twice and it bounces it is sent back to the checkwriter. I do have the confirmation notice from the bank, though. It states that the check bounced because of NSF, the amount, and the name of the check writer. Will this work?

  4. EdG

    EdG Well-Known Member


    You could always go down to your local police department and file a charge against your customer. I believe it is called "Negotiating a worthless instrument" (passing bad checks). Your customer will have to appear in court to answer these charges, and if she is found guilty she will at the very least have to pay you the amount of the bad check.

    I guess it depends on weather or not you want to take it to this level. You could gently remind her that this is an option you are considering. Especially with her bad check history with your company.

    I'm no expert at this stuff I'm just speculating.

  5. Dani

    Dani Well-Known Member

    Thanks for your suggestion, Ed. This was her first bad check, but it bounced twice. She does have a very questionable payment history which is the reason I put her on a COD account. At this point I see no other alterative, but to take her to court. I hate doing that, but she said she isn't paying. There was nothing wrong with the work performed and she said that was fine. She's ticked because I wouldn't place another service call for her because she wrote us a bad check that she has not rectified.

  6. sam

    sam Well-Known Member

    Simple, call her up, tell her you have until tomorrow to bring cash for the check, a warrant will be issued for your arrest if not. She can pay you or the bail bond person (after a nights stay).

    You think those check cashing places are joking when they say that? Nope. They will follow through.

    Lets see:

    1. Pay bill
    2. Get arrested, spend time in jail until bonded out
    get on probation, pay fine and restitution.

    Thats a hard one..
  7. Erica

    Erica Well-Known Member


    You got it easy, hon. My father runs a business out of his home and sells items thru trade magazines and e-bay. Well to make a long story short, a lady in California wrote a check for $1100 that was drawn on a Delaware bank and cashed in New York. Needless to say, the cashier's check she wrote was counterfeit and my dad is out Bounced check fees, merchandise and $1100. He had to file a local police report, a report with the Secret Service, and hope that they catch her trying to sell the stolen merchandise (the serial # is in the crime computer as stolen). That is the only way that they can catch her, and then they would only charge her with posession of stolen merchandise (a misdemeanor) instead of Grand Larceny (a felony).

    I would definately call the authorities, file a police report and take care of it that way. If she is not paying you, who else is she not paying?
  8. roni

    roni Well-Known Member

    You have two options... small claims court or let your local district attorney handle it. If you go small claims court, lets assume you'll win the case, but you'll still have to jump hoops to get the award.

    If you go through District Attorney, it will take more time, but they handle the paperwork for you.

    Credit---->COD----->CIA/CIF Cash IN ADVANCE/Cash In FIST!

  9. daveberk

    daveberk Well-Known Member

    Either file in small claims or make a police report but do not threaten her with arrest. Doing that is a criminal offense. It is called extortion.
  10. roni

    roni Well-Known Member

    Very true... including that you are subject to the FDCPA.
  11. supershawn

    supershawn Well-Known Member

    Everyone makes mistakes, but it sounds like she knows what she is doing and is not making an attempt to rectify the situation. That is wrong, especially after you have been so patient with her.

    I think most states have the 10-day letter process..... a friend of mine had to do wthis with an old roomate.

    You go to the police station or court (some have a dwonloadable on their web site, GA does) and get a 10-day letter form. Basically, it is a letter stating that they wrote you a bad check that you presented twice and it was NSF. The letter states that they have 10 days (hence the name) to make good on payment with certified funds or cash. On day 11 they are arrested. Seriously. They take it pretty seriously.

    Here is a FAQ from Georgia on this subject

  12. redline

    redline Member

    In my state you can take the information to the prosecuting attorney they will notify the person and tell them to pay or they would file fraud charges on behalf of the state although I believe the check has to be written on an in state check. If this was a service call to repair part of the residence you can also put a lien against the property it may take awhile but before that home can ever be sold the outstanding lien must be taken care of. I'm not a lawyer so check your on government laws but I have seen both of these things work.

  13. bbauer

    bbauer Banned

    Something wrong here. The check is yours until it is cashed and if it bounced, it's supposed to go back to you and not to the checkwriter. I would check this out very carefully. I bet you have it somewhere in your office. Giving (sending) it back to the check writer leaves you with no where to go but small claims court. That's wrong. You are supposed to be able to get prosecution and you aren't likely to get it if you don't have the check for evidence.

    On top of that, most DA's won't prosecute past 90 days, sometimes 30 days in some jurisdictions.
  14. dogman

    dogman Well-Known Member

    Get your cash!

    Business is business. Send her a registered return receipt demand for payment of the amount, BY MONEY ORDER. Tell her if she does not respond in 14 business days , on Nov xx, you will contact Chexsystems and report her.
    Tell her the only way that this WILL NOT happen is that your will have the payment as requested IN YOUR HANDS before that Nov xx date.

    IF she ignores you, report to CHEXsystems, and drop the matter.

    IF she pays, great. BUT if you still deal with her later - only take cash in advance (NOT COD) before you perform the work.

    Look at the repeated aggravation you have expended for this nut! Your time is better spent getting good customers.

    This is not just a bad credit report and check report for her! She has stiffed you!

    cya dogman
  15. Saar

    Saar Banned

    Re: Get your cash!

    In some states, filing a small-claims suit is allowed only for individuals, not corporations. Thus, if the check was made payable to the corporation, you'd have to see if your state law allows corporate plaintiffs in a small-claims forum.

  16. author_22

    author_22 Well-Known Member

    Re: Get your cash!

    I would file a judgement against her. It's not like she didn't know and didn't get a chance to rectify it.

  17. GEORGE

    GEORGE Well-Known Member

    Re: Get your cash!

  18. bbauer

    bbauer Banned

    Re: Get your cash!

    I think that if you will check out your laws on bounced checks you will find that the maximum that can be charged for a bounced check is $25.00. A couple of states have maximums as low as $15.00, but if I remember correctly there are no states the do not have a cap on what can be charged for a bounced check.

    District Attorneys apparently do not fall under those laws because they seem to be able to charge the check kiter almost anything they want to. Maybe it's just because they don't get challenged on it.
  19. Dani

    Dani Well-Known Member

    Re: Get your cash!

    Thank you everyone for your great advice. Bill I don't have the check. I'm absolutely positive about this. All our local banks around here send the check back to the check writer if it is redeposited two times. The first time it bounces it is returned to the creditor. If you redeposit it and it bounces again it is returned to the signee. I guess so that creditor does not repeatly deposit it. Monday morning I'm going to our local courthouse and fill out the necessary paperwork. Looking at VA law I can sue her in small claims court even though the company is a corporation. I'm not looking forward to it, but it needs to be done. Thanks, again.


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