A bad check is a check that you cannot cash because the person who wrote the check: (1) doesn’t have enough money to cover it (“insufficient funds”), or (2) told the bank to “stop payment” on it without having a valid reason for doing so.
Writing a bad check is a crime if the check writer knew that there were insufficient funds to cover the check and intended to defraud you. It is also a crime to forge a check or write a fake check. If you believe you are a victim of a crime, report this to your police department, sheriff’s office, or district attorney’s office.
You may also sue someone who writes you a bad check without having a valid reason for doing so. You may also recover damages equaling three times the amount of the check, up to a maximum of $1,500, if you meet certain conditions:
- You must send a demand letter to the person who wrote the check. Send the letter by certified mail with a return receipt, and keep a copy of the letter and receipt. You may use this sample “bad check” demand letter if someone wrote you a check but had insufficient funds to cover it. You may use this sample “stop payment” demand letter if someone stopped payment on a check without a valid reason.
- If the check writer does not pay you within 30 days, you may file a lawsuit.
- Where to file your lawsuit:
- If you are asking for $10,000 or less: File in small claims court. Note that you cannot have a lawyer in small claims court because that court is meant to resolve disputes quickly and inexpensively.
- If you are asking for more than $10,000: File in the civil division of the superior court. Note that different rules apply in superior court and in small claims court.
- A copy of your demand letter and the signed certified mail receipt that proves you mailed the letter.
- Any documents related to your case, like a copy of the bad check, bank statements, receipts, letters or emails to or from the check writer, and notes of any conversations you had with the check writer.