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E. Bouncing Checks Law

1. CONCEPT

“Credit” – refers to an arrangement or understanding with the bank for the payment of such check. (Section 4, B.P. 22)

2. CRIME

a. Bouncing check

1st Mode

1) Any person who makes or draws and issues any check to apply on account or for value, knowing at the time of issue that he does not have sufficient funds in or credit with the drawee bank for the payment of such check in full upon its presentment, which check is subsequently dishonored by the drawee bank for insufficiency of funds or credit or would have been dishonored for the same reason had not the drawer, without any valid reason, ordered the bank to stop payment, shall be punished. (Section 1, Ibid.)

ELEMENTS OF THE CRIME:

1) The making, drawing, and issuance of any check to apply for account or for value;

2) The knowledge of the maker, drawer, or issuer that at the time of issue he does not have sufficient funds in or credit with the drawee bank for the payment of the check in full upon its presentment; and,

3) The subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit or dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to stop payment. (San Mateo v. People, G.R. No. 200090, 06 March 2013)

2nd Mode

1) Any person who, having sufficient funds in or credit with the drawee bank when he makes or draws and issues a check, shall fail to keep sufficient funds or to maintain a credit to cover the full amount of the check if presented within a period of ninety (90) days from the date appearing thereon, for which reason it is dishonored by the drawee bank, shall be punished. (Paragraph 2, Section 1, Ibid.)

WHERE A CORPORATION: Where the check is drawn by a corporation, company or entity, the person or persons who actually signed the check in behalf of such drawer shall be liable under this Act. (Paragraph 3, Section 1, Ibid.)

PRIMA FACIE EVIDENCE OF KNOWLEDGE OF INSUFFICENT FUNDS: The making, drawing and issuance of a check payment of which is refused by the drawee because of insufficient funds in or credit with such bank, when presented within ninety (90) days from the date of the check, shall be prima facie evidence of knowledge of such insufficiency of funds or credit unless such maker or drawer pays the holder thereof the amount due thereon, or makes arrangements for payment in full by the drawee of such check within (5) banking days after receiving notice that such check has not been paid by the drawee. (Section 2, Ibid.)

2. DUTY OF DRAWEE

1) TO CAUSE TO BE WRITTEN, PRINTED, STAMPED THE REASON FOR DISHONOR OR REFUSAL: It shall be the duty of the drawee of any check, when refusing to pay the same to the holder thereof upon presentment, to cause to be written, printed, or stamped in plain language thereon, or attached thereto, the reason for drawee’s dishonor or refusal to pay the same: Provided, That where there are no sufficient funds in or credit with such drawee bank, such fact shall always be explicitly stated in the notice of dishonor or refusal. (Section 3, Ibid.)

PRIMA FACIE EVIDENCE: In all prosecutions under B.P. 22, the introduction in evidence of any unpaid and dishonored check, having the drawee’s refusal to pay stamped or written thereon or attached thereto, with the reason therefor as aforesaid, shall be prima facie evidence of the making or issuance of said check, and the due presentment to the drawee for payment and the dishonor thereof, and that the same was properly dishonored for the reason written, stamped or attached by the drawee on such dishonored check. (Ibid.)

ORDER TO STOP PAYMENT, STATE IN NOTICE RE INSUFFICIENT FUNDS: Notwithstanding receipt of an order to stop payment, the drawee shall state in the notice that there were no sufficient funds in or credit with such bank for the payment in full of such check, if such be the fact. (Paragraph 2, Section 3, Ibid.)

3. LIABILITY UNDER THE REVISED PENAL CODE

Prosecution under this Act shall be without prejudice to any liability for violation of any provision of the Revised Penal Code. (Section 5, Ibid.)

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