Is it legal to impose a service charge for a check that didn’t clear?

Only some service charges are legal

Many states permit a debt collector to impose automatically a service charge on any unpaid check. Some states require that debt collectors follow particular procedures before a service charge is due. Some states don’t have any law at all forcing you to pay a check service charge .

What you should do

If you receive a letter demanding that you pay a check service charge, you may contact us to find out if the debt collector is violating your rights. We have recovered more than $10,000,000 for consumers who were tricked into paying unlawful service charges. Companies like Certegy Check Services, Telecheck and TRS Recovery make millions of dollars every month collecting check service charges. Contact us to see if you have been cheated by a debt collector who added unlawful fees when attempting to collect your unpaid check.

I received a collection letter from my local prosecutor about an unpaid check. What should I do?

Usually, you received this letter because a merchant, or a debt collection company like Certegy, Telecheck or TRS Recovery claimed that you have not paid the check, and they sent it to a company like National Corrective Group or Bounceback, which has added more fees that you are being told to pay. The mere fact that you have an unpaid check does not mean that you owe the fees being charged or that are going to be prosecuted if you don’t pay for an expensive “financial education” class.

Make sure this is really a check you wrote

Review your records to make sure you really wrote this check, and that it has not been paid. If you did not write this check, or the check has been paid, make sure you notify the debt collector or prosecutor in writing.

Is the letter from a real prosecutor or from a debt collector?

In most instances, checks or check information are transmitted directly by the merchant or collection agency to the check diversion company, without a prosecutor reviewing any evidence. If the letter gives a toll-free number for you to call, a private company probably sent the letter. If you send a copy of the letter to this office, we can tell you who sent it. If your local prosecutor really sent the letter, you will have to resolve this with the prosecutor’s office.

Send a letter disputing that you committed a crime

In most states, it is not a crime to write a check that did not clear, unless you knew it wasn’t good and you intended to defraud the merchant. If you do not think that you had criminal intent, WITHIN 30 DAYS after you received the first letter, send a letter to the address on the letter you received, disputing the claim that you committed a crime.

If you have questions, contact this office. There is no charge.