If I’m an independent business owner and have a customer that has given me 3 checks that have all bounced, when does it become fraud?
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If I’m an independent business owner and have a customer that has given me 3 checks that have all bounced, when does it become fraud?
Asked on October 13, 2012 under Business Law, New York
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
Under the laws of all states in this country the "fraud" that you have written about arises when the person issues the check to you does not have adequate funds in his or her checking account and such person knows this fact.
From what you have written, you seemingly have a case for fraud with the three (3) bad checks. It appears that your legal recourse is small claims court.
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
Fraud is based on intent, so the question is, do the facts suggest an intent to defraud you? If the checks were written at different times, then three bounced checks suggests that it may be fraud--the customer knows he or she doesn't have the funds but keeps writing bad checks to buy time and/or get you to keep providing goods or services. If all three were written at more or less the same time, then it would, on the other hand, be easy to imagine that he or she was victim of either bad accounting (not tracking funds well) or timing--some payment he or she was counting on not being applied in time.
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