• What Is a Bounced Check?
• What Should I do if My Check Bounces?
• What If the Debt Collector Does Not Follow the Procedure?
• How Can Someone Collect a Debt from Me?

This publication is a summary of law contained in Codes, Statutes and Court Cases. For those who want to do further research we have included citations-that is the place were the information summarized can be found.

What is a Bounced Check?

A "bounced" or dishonored check is a check that you write that you cannot pay for, generally because you do not have enough money in your bank account to cover the amount on the check. Writing bad checks is a crime in Washington. State law details specific procedures that you and the party trying to collect on your check must follow when your check bounces.

What Should I do if My Check Bounces

After giving your check to a merchant, the merchant sends your check to the bank to collect the money. If you do not have enough money in your account to cover the check, the bank will dishonor, or not pay, the merchant for your check. When this happens, your check has "bounced". Your bank will return the check to the merchant and the bank or a collection agency will send you a Notice of Dishonor. The Notice of Dishonor will tell you that you still owe the merchant the face value of the check and that you also owe a returned check fee to the bank or collection agency.

After your bank sends you this Notice of Dishonor, the bank is no longer involved in collecting on your check. The collection becomes between you, the merchant and any collection agency the merchant may choose to involve. The law sets out very specific procedures for the merchant and debt collection agencies to follow in their actions to collect the money that you owe them.

• 15 days after the Notice of Dishonor is sent, the person to whom you owe money has the option of filing a lawsuit against you to collect the debt. During the 15 day period, the amount that the merchant or collection agency can collect from you is limited to the face amount of the check, a reasonable handling fee, a 12% annual interest fee built up since the Notice of Dishonor was sent, and costs of collection not to exceed  the face amount of the check or $40, whichever is less.

• If you fail to resolve the matter within this 15 day period, the merchant or collection agency may file a lawsuit against you and you may be responsible for the above costs as well as any court costs, service costs, and court determined attorney fees.

• If the lawsuit proceeds and the court rules that you bounced the check, you may then be responsible for all of the above costs and fees AND three times the face amount of the check or $300, whichever is less.

What If the Debt Collector Does Not Follow the Procedure?

Whoever is trying to collect money from you for the bounced check must follow these procedures exactly. They are breaking the law if:

• they demand higher interest or collection fees than described above,

• they demand any interest or collection fees sooner than 15 days after the Notice of Dishonor is sent to you,

• they demand attorney fees that are higher than those set by the court, or they demand attorney fees sooner than 15 days after the Notice of Dishonor is sent to you.

If they do any of these things in trying to collect from you, they will no longer have any claim to collect interest fees, collection costs, or attorney fees. You will owe only the face amount of your check and a reasonable handling fee.

How Can Someone Collect a Debt from Me?

Federal law prohibits debt collectors from doing certain things as they try to collect a debt from you. [see Federal "Fair Debt Collection Practices Act" (15 U.S.C. 1692 et seq.)]. If a debt collector does any of these things to you while they are trying to collect on your bounced check you may be entitled to certain financial benefits. Debt collectors are NOT ALLOWED TO:

• Contact you if they receive notice that you have attorney representation.

• Tell anyone that they are from a debt collection agency (unless they are specifically asked) or that you owe a debt while they are trying to find you. They are required however, to identify themselves and say that they are trying to find you.

• Talk to anyone, other than those directly connected with the case, about the debt. Thus, they cannot tell your employer, relatives or your friends you owe a debt - although they can talk to your spouse about the debt or to your parents if you are a minor.

• Contact you anymore if you write them to say that you will not pay the debt or that you want them to stop contacting you. However, they may contact you to tell you that they will no longer try to collect the debt, that there are specific actions they can now take against you to solve the problem or that they are taking specific actions against you to collect the debt (like filing suit against you).

• Threaten you with arrest for not paying your debt.

• To call you at work if they have reason to know it is inconvenient.

Under both federal and Washington State law, a debt collector is prohibited from:

• Claiming he is someone he is not - like a representative of the government or an attorney.

• Claiming he can take actions that he can not - like taking your house, telling your boss that you owe a debt, or that he can hurt your credit rating.

Washington State law specifically prohibits debt collectors from doing the following things while they are trying to collect a debt from you [see Washington State "Collection Agencies" statute (RCW 19.16.250)]:

• Calling before 7:30 a.m. or after 9 p.m.

• Calling your house more than 3 times a week.

• Calling you at work more than once a week.

If any of these rules are violated, you may be eligible to receive money from the debt collector or collection agency.

This publication provides general information concerning your rights and responsibilities. It is not intended as a substitute for specific legal advice.
This information is current as of the date of its printing, August 2005.