Cheque Dishonored UAE
Cheque Dishonored UAE – Law for Cheque Dishonored Dubai UAE Violation of bounced checks is primarily governed by Article 401 of Federal Law No. 3 of 1987 ( “UAE Penal Code” ), which states the following:
Detention or fine shall be imposed on any person who, in bad faith, presents a draft (cheque) without sufficient balance and may be drawn, or, after a check has been drawn, withdraws all or part of the balance, rendering the balance insufficient for settlement of the check, or if he is required to The drawee fails to cash the cheque or make or sign the cheque in a manner that prevents him from cashing it. The same penalty shall apply to any person who endorses the cheque in favor of another person or gives it a draft to its bearer, knowing that there is an insufficient balance to honor the check or that it is not withdrawable.
Cheque Dishonored UAE Not only the disgrace of the cheque but also any action in which a person stops paying the cheque is seen as a crime in few cases. This includes making changes in the cheque that prevent the payee from cashing,
For example,
- intentionally signing the wrong signature,
- omitting the person’s signature completely,
- or not having enough funds in the account at the time the cheque was issued.
Any act or omission that prevents the beneficiary from cashing the cheque is a criminal offense and is punishable under the UAE Penal Code.
Cheque Dishonored UAE – Criminal proceedings are usually taken against the person who signed the cheque regardless of whether it is an attorney, manager, accountant, or anyone who signed the cheque. Even if the illegal cheque is from a company owned by someone else, the signer of the cheque will be charged with criminal proceedings. This is based on the premise that as a responsible executive of the company, the signer must be aware that there are insufficient funds in the account before the cheque is issued. However, both the signer of the cheque and the company may have a civil liability to pay the money.
Moreover, the mere fact that the dishonored cheque was signed and delivered for a legitimate transaction exposes the signer to criminal proceedings even if the transaction is not completed. Failure to complete the transaction will be considered a civil argument, and will not be a defense to criminal prosecution.
In general, whether it is a personal cheque or a company cheque, the person who signed the cheque will be criminally involved. The usual cases, including but not limited to, on a personal and personal level is when a person or company issues checks:
After obtaining a loan from the bank (it can be personal and corporate) Providing a security check after obtaining a credit card (it can be personal and corporate) Taking a cash loan and providing a check as security for the creditor (usually personal), To buy and sell goods and services (it can be personal and corporate) Signing the check as a guarantor (it can be both personal and corporate) The reasons may be ‘insufficient funds’ or ‘closed/dormant account’
Filling a Cheque Dishonored UAE
- To open a cheque bounce in a few cases (Fraud / Wrong intention), the first step in the Emirate of Dubai is to request the registration of a criminal complaint with Dubai Police; With the recent developments, this request should be made online only on the Dubai Police website or mobile application by uploading a copy of the bounced cheques, bank memos, and complaints numbers by following the necessary steps.
- Once the above procedures are completed, Dubai Police will send an automated response via email stating that the criminal complaint request has been successfully registered. The complainant will then receive a short message from Dubai Police to visit the concerned police station to submit the original documents and complete the registration of the criminal complaint.
- Once the above procedures are completed, Dubai Police will send an automated response via email stating that the criminal complaint request has been successfully registered. The complainant will then receive a short message from Dubai Police to visit the concerned police station to submit the original documents and complete the registration of the criminal complaint.
- Once the criminal complaint with the police station is successfully registered, an automatic arrest warrant/travel ban will be imposed on the defaulting party who bounced the cheque.
- If this person tries to leave the country, he will be stopped/arrested and arrested at the airport and will be detained at the police station.
- It is important to note that the fine and prison term that the authorities may grant will depend on a case-by-case basis, and depending on the amount of the bounced cheque. Thus this criminal justice will be awarded against the defaulter.
Negotiations: can also take place during this stage. As in itself the amount of the defaulted check also can only be claimed by initiating a civil case
In the criminal case filing process, the beneficiary can also, file the initial civil claim application (compensation amount) for the criminal case.
As soon as the criminal court issues its judgment, the criminal court will refer this request to the civil court competent in the civil case
A civil case (amount recovery) action can be brought at any time, but generally, a civil and criminal action should not be brought at the same time as the civil action is suspended until the final judgment is issued in the criminal case.
As soon as the civil lawsuit is filed and the beneficiary benefits from a final judgment in his favor, the matter will be transferred to the enforcement department of the court will first ask the beneficiary to provide them with the information they have available against the defaulter. This will therefore help the court to start the booking process.
Possible avenues for redeeming the cheque amount are by attaching the personal/corporate property of defaulters as the case may be, freezing bank accounts, blocking the business license of the company in the event of a company, or attaching movable assets like cars, bikes, etc.
It is important to note that the process of obtaining the final civil judgment can take at least 6 months – 18 months depending on the case. During this time, the defaulter may try to end up and leave the UAE, which will be detrimental to the beneficiary.
To prevent the defaulter from fleeing the country, a travel ban request may be submitted to Dubai Courts by attaching the criminal court judgment and proving the reasons for imposing a travel ban on the defaulter
In the end, it is at the judge’s discretion whether to grant a travel ban or not.
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