Bank account closed for illegal activity

[DMAR10]

What is the name of your state? Iowa

Greetings,

I have two different checking accounts, and sometimes I would write checks between the two to quickly transfer money. I will admit that sometimes I made an atm deposit with a check I knew would not be covered until the next business day, but I believed as long as the funds were there the time the check cleared it would be legitimate.

Last week one of my banks closed my accounts automatically, and after a few phone calls they finally revealed they suspected illegal activity like check kiting and needed to close my accounts. I asked if any charges would be filed, after mentioning I wasn't aware I had committed a crime, and they said they were waiting for deposits to clear and would need to call police if they took a loss. I don't think they will have a negative balance in the account, and am waiting in limbo while they get everything worked out on their end.

My questions are the following:
1.) In Iowa, what are the criminal penalties for passing bad checks or check kiting? If it depends on the amount of loss, the bank would lose less that $300 I believe.

2.) If my bank does not take a loss, can they still file charges?

I have been doing research on different cases and found that usually if a suspected misusers of accounts pays back lost money, then the bank will not be filing charges. Also, I know all the time how if a check bounces the merchant usually just requests a person to pay them the difference plus a fee, but wouldn't having a check returned be the same as passing a bad check?

Again, I did not knowingly deceive the banks, I just always made sure that the funds were there the same business day as the checks were written.

 

[sandyclaus]

What is the name of your state? Iowa

Greetings,

I have two different checking accounts, and sometimes I would write checks between the two to quickly transfer money. I will admit that sometimes I made an atm deposit with a check I knew would not be covered until the next business day, but I believed as long as the funds were there the time the check cleared it would be legitimate.

Last week one of my banks closed my accounts automatically, and after a few phone calls they finally revealed they suspected illegal activity like check kiting and needed to close my accounts. I asked if any charges would be filed, after mentioning I wasn't aware I had committed a crime, and they said they were waiting for deposits to clear and would need to call police if they took a loss. I don't think they will have a negative balance in the account, and am waiting in limbo while they get everything worked out on their end.

My questions are the following:
1.) In Iowa, what are the criminal penalties for passing bad checks or check kiting? If it depends on the amount of loss, the bank would lose less that $300 I believe.

2.) If my bank does not take a loss, can they still file charges?

I have been doing research on different cases and found that usually if a suspected misusers of accounts pays back lost money, then the bank will not be filing charges. Also, I know all the time how if a check bounces the merchant usually just requests a person to pay them the difference plus a fee, but wouldn't having a check returned be the same as passing a bad check?

Again, I did not knowingly deceive the banks, I just always made sure that the funds were there the same business day as the checks were written.

What you did is known as check kiting - and it is absolutely illegal. You were essentially moving around money on paper, hoping that the bank wouldn't catch you without the funds you knew you didn't have and ding you with an overdraft. Read more here: http://www.wisegeek.com/what-is-check-kiting.htm

Some people make a ton of profit on this illegal activity, and there can be severe penalties including jail time. Of course you knew what you were doing was wrong, you just didn't think you'd ever get caught.

 

[DMAR10]

No I absolutely did not know what I was doing was wrong. I don't see how much I could have profited from this. I always knew the checks would clear because funds were in there or my overdraft defender was in effect.

 

[Zigner]

No I absolutely did not know what I was doing was wrong. I don't see how much I could have profited from this. I always knew the checks would clear because funds were in there or my overdraft defender was in effect.

Are you seriously suggesting that you didn't know writing a check against an account that you KNEW did not (at that moment) have the funds available was wrong?

 

[DMAR10]

Yes, I was not aware

Yes, I was not aware. I did not believe it was illegal. People have overdrafts all of the time. And according to Iowa Criminal Code I should be okay.

"Makes, utters, draws, delivers, or gives any check, share draft, draft, or written order on any bank, credit union, person, or corporation, and obtains property, the use of property, including rental property, or service in exchange for such instrument, if the person knows that such check, share draft, draft, or written order will not be paid when presented.
Whenever the drawee of such instrument has refused payment because of insufficient funds, and the maker has not paid the holder of the instrument the amount due thereon within ten days of the maker’s receipt of notice from the holder that payment has been refused by the drawee, the court or jury may infer from such facts that the maker knew that the instrument would not be paid on presentation. Notice of refusal of payment shall be by certified mail, or by personal service in the manner prescribed for serving original notices.
Whenever the drawee of such instrument has refused payment because the maker has no account with the drawee, the court or jury may infer from such fact that the maker knew that the instrument would not be paid on presentation."

The bolded part takes into account those who were not aware their checks were over, or their checks would clear by the time they hit the bank.


I suspect writing a check to a retailer or merchant for over the amount is the same thing. Or an employer who withholds wages due to employees.

 

[swalsh411]

In this case I doubt you will be charged because nobody was defrauded. (assuming all your checks clear). But FYI, ignorance of the law is no excuse.

 

[tranquility]

If anyone suffers a loss, you probably will have an issue. You knew you were gaining an "advantage". While you may have an argument if all is well, arguments can be expensive. The whole point of the fiction was to have more than you have, that would be enough intent for a crime.