Understanding Bad Check Laws in Texas
Namaste NRI, this article furthers our goal of building a strong NRI community by educating readers with the legal insights that affect their expatriate lives. Today’s topic is:
Image by MikeGottlieb | Pixabay
Financial literacy is crucial for all communities to avoid tricky situations and bad financial decisions, but it’s particularly important for members of a minority group. Individuals from a specific culture, such as the Telugu and broader Indian community, share values, beliefs, and experiences that impact their preferences and willingness to adopt new concepts. South Asian entrepreneurs are some of the most financially successful in the country despite enduring systemic racism, social marginalization, and cultural invalidation. The Telugu NRI community sends back billions of dollars to India every year, and many members hope to retire there. Understanding and respecting the legal complexities involved in expatriate life is key to achieving your business and personal financial goals overseas. Namaste NRI is dedicated to helping you understand the law, and here’s what you need to know about the comprehensive bad check laws in Texas.
Image by Worlds of Pixels | Needpix
Bad check laws prevent individuals from writing checks without sufficient funds to cover the amount given on the document. Typically, companies that work directly with the public conduct background checks to verify that v-check clients do not have a history of check fraud. Under Texas law, you cannot write or issue a check unless you have enough money in the account to cover the balance and any outstanding debts. If the issuer of a check does not have cash or enough credit to back the document, it may be returned, and the individual can face charges for check fraud.
Under Texas Penal Code 31.04, you could face a first or second degree felony if: After returning the check unpaid, the creditor or person to whom the bad check was delivered may mail the issuer a notice. The notice should indicate the issuer may have committed the offense of check forgery under Texas Penal Code 32.41. You must pay the overdraft amount and the $30 bad check charge. The notice must give you at least 10 days to make payment. If you haven’t made good on the amount owed after 10 days, you could face a charge of issuing a bad check with fraud intent under Texas Penal Code 31.01. It is a Class C misdemeanor to issue a check with the knowledge that you don’t have the funds to cover the amount. If this happens as part of a scheme to defraud, it is a Class B misdemeanor due to the intent. These two offenses are only punishable with a fine, but they can add up quickly. To put things into perspective, the maximum penalty for a Class B charge is a fine of $2,000, even though most receive fines of no more than $500 or $1,000.
Handwritten notes, business checks, and money orders are acceptable. However, state law prohibits using bank checks, government checks, or money orders that do not clearly show the instrument was paid. No later than the 30th day after delivering the bad check or money order, you have to make good on the amount owed. If you don’t, you risk the company or individual filing criminal charges against you. If arrested, you will be booked and jailed like any other defendant. This typically includes being fingerprinted, photographed, and restricted to a holding area until your bail is paid.
There are alternatives to paying for a bad check, such as disputing a returned bad check letter. You should only consider disputing the notice if the check was in fact lost in the mail or delivered to the wrong address by the post office. Unfortunately, arguing your mail was mishandled by the post office is not a strong legal defense. You are not the only individual who may have written a bad check. Due to the importance of processing payments quickly and expediting transactions, most businesses take steps to prevent bad checks. For example, if the business owner has sufficient evidence that the notice was delivered and you failed to make good on the balance, they may report you in the Texas, Crime Information Center (TCIC) database. The person or company may also report you to the local police and initiate a bench warrant for your arrest.
If you’ve been issued a bad check, it is in your best interest to verify how it fell through the cracks from the sender’s perspective. In many cases, the company may be willing to correct the record. If not, you’ll have opportunities to defend yourself and avoid a penalty. Take the time to become familiar with international and Texas laws. Even if you have no plans to retire in the United States, you should be aware of the peculiarities of doing business here and the individual laws included in individual states.
