4 Jo Anne Bernal El Paso County Attorneywww.epcounty.com/CA/ HOT CHECK SEMINAR

5 The Federal Reserve Bank says less than 1 % percent of all checks bounce. That still means about 600 million yearly. The Federal Reserve Bank says less than 1 % percent of all checks bounce. That still means about 600 million yearly. A 2006 study by the Federal Reserve estimates that thru 2015 payments by check will remain the second most popular method of payment, with 23 % share of the market. A 2006 study by the Federal Reserve estimates that thru 2015 payments by check will remain the second most popular method of payment, with 23 % share of the market. A recent Nilson Report estimates that more than 1.2 million worthless checks enter daily the payment system. A recent Nilson Report estimates that more than 1.2 million worthless checks enter daily the payment system. National Statistics

6 If you have received an insufficient funds or a closed account check, then you are a victim of a crime. If you have received an insufficient funds or a closed account check, then you are a victim of a crime. We might also be able to help you when check was not paid because of “stop payment” by the check writer We might also be able to help you when check was not paid because of “stop payment” by the check writer Theft by check is a crime Theft by check is a crime You are entitled to restitution You are entitled to restitution You are entitled to a merchant fee You are entitled to a merchant fee Our Office is your Option for Criminal Prosecution

7 What Can the County Attorney Do? Enforce the state laws which prohibit the passing of hot checks to both merchants and individuals. Enforce the state laws which prohibit the passing of hot checks to both merchants and individuals. The Texas Legislature authorizes El Paso County Attorney to process and collect hot checks if the amount is less than $1,500. The Texas Legislature authorizes El Paso County Attorney to process and collect hot checks if the amount is less than $1,500. The Texas Penal Code empowers this office to aggressively prosecute hot check writers. The Texas Penal Code empowers this office to aggressively prosecute hot check writers.

8 What Can the County Attorney Do? If the amount of the check is more than $1,500: File a report with police/sheriff File a report with police/sheriff Case will be turned over to the District Attorney’s Office Case will be turned over to the District Attorney’s Office If DA declines to prosecute the case, you have the right to ask the County Attorney to attempt to collect without criminal prosecution. If DA declines to prosecute the case, you have the right to ask the County Attorney to attempt to collect without criminal prosecution.

9 Goals of the Office of the County Attorney To make every attempt to collect restitution from hot check writers To make every attempt to collect restitution from hot check writers If restitution can not be collected, we will prosecute those cases which satisfy the elements of the Texas Penal Code If restitution can not be collected, we will prosecute those cases which satisfy the elements of the Texas Penal Code Our goal is to save you money by actively pursuing hot check offenders Our goal is to save you money by actively pursuing hot check offenders

10 Mission of the Hot Check Unit Prompt collection of the face amount of the check and fees for the benefit of the payee prior to prosecution Prompt collection of the face amount of the check and fees for the benefit of the payee prior to prosecution Maximize collection of money from hot check writers Maximize collection of money from hot check writers Quicker payment of restitution to merchants Quicker payment of restitution to merchants Implementation of a system of status reports for merchants which refer large volume of checks Implementation of a system of status reports for merchants which refer large volume of checks

11 Deliver presentations to educate merchants on proper pre-referral procedures Deliver presentations to educate merchants on proper pre-referral procedures Review and prosecute backlog of hot check accounts Review and prosecute backlog of hot check accounts Prosecution of misdemeanor hot check writers Prosecution of misdemeanor hot check writers Mission of the Hot Check Unit

12 The following criteria must be met: Proper identification on check Proper identification on check  Driver’s license  Date of Birth Personal knowledge  Identify who signed the check  Identify who signed the check Check is within the Statute of Limitations (2 Years from the date of the check) Check is within the Statute of Limitations (2 Years from the date of the check) Check is for Goods or Services only (not included are repayments of loans etc.) Check is for Goods or Services only (not included are repayments of loans etc.) Check is dated from the date of issuance Check is dated from the date of issuance To File a Criminal Case

13 Steps to take when you receive a Hot Check Send a notice of dishonor to the check writer. Send a notice of dishonor to the check writer. Demand payment within ten days of receipt of the notice. Demand payment within ten days of receipt of the notice. Request a merchant collection fee if it is authorized by Texas Business & Commerce Code Section Request a merchant collection fee if it is authorized by Texas Business & Commerce Code Section Send a copy of the check(s) to the check writer. Send a copy of the check(s) to the check writer.

14 Send the notice of dishonor by first class mail with an affidavit of service or by certified mail, return receipt requested. Send the notice of dishonor by first class mail with an affidavit of service or by certified mail, return receipt requested.notice of dishonornotice of dishonor Keep a copy of the notice of dishonor with the original check and the original affidavit of service, or the certified receipt of delivery, or the returned envelope and notice if undelivered. Keep a copy of the notice of dishonor with the original check and the original affidavit of service, or the certified receipt of delivery, or the returned envelope and notice if undelivered. Steps to take when you receive a Hot Check

15 1. The original check or substitute check as defined by federal law 2. Merchant intake form 3. Copy of “Notice of Dishonor” 4. The Affidavit of Service by First Class Mail or Return Receipt (green card or compute tracking notice) or the unclaimed SEALED returned envelope Four simple things you must provide to help us help you:

16 Office of the County Attorney Attention: Hot Check Department 500 E. San Antonio, Room 503 El Paso, Texas Office of the County Attorney Attention: Hot Check Department 500 E. San Antonio, Room 503 El Paso, Texas Please submit this information to:

17 After Referral to County Attorney Once you refer the bad check to us with the necessary documents, you should NOT accept any payments from the check writer.

18 / Copy of the Notice of Dishonor

19 Affidavit of Service by First Class Mail

20 Hot Check Intake Form

21 To limit bad checks make sure…  The Check Is Signed & Dated.  The Signature Matches the Name on the Check.  The drivers license number is on Check and matches number on the ID.  The Address on Check Matches the address on ID.

22 To limit bad checks make sure…  The Check is Imprinted With Customer’s Name & Address.  The Check has not been Altered or Defaced.  The Check has not been Postdated or Backdated.  The Check does not have a P.O. Box as the Address.  The Account Number appears on the Check.

23 Require Identification! A Texas Driver's License is the best form of identification A Texas Driver's License is the best form of identification A military identification card is acceptable A military identification card is acceptable Local credit cards and other forms of photo identification may also be helpful Local credit cards and other forms of photo identification may also be helpful A social security card is only acceptable if it is offered with a picture ID that matches the check A social security card is only acceptable if it is offered with a picture ID that matches the check

24 Examine the Identification Closely Make sure the person passing the check matches the photo on the identification. Make sure the person passing the check matches the photo on the identification. Make sure the check address matches the address on the identification. Make sure the check address matches the address on the identification. Make sure the expiration date on the identification has not already expired. Make sure the expiration date on the identification has not already expired. Make sure the check name and signature matches the name and signature on the identification. Make sure the check name and signature matches the name and signature on the identification. Make sure the date of birth on the check matches the date of birth on the identification. Make sure the date of birth on the check matches the date of birth on the identification.

25 Don't Ignore RED FLAGS!! If you believe the check is suspect, don't accept the check. If you believe the check is suspect, don't accept the check. If you believe the identification is questionable, don't accept the check. If you believe the identification is questionable, don't accept the check. If the check and identification do not match, don't accept the check If the check and identification do not match, don't accept the check

26 Always Take these Steps before Accepting a Check! Always copy the identification number and date of birth onto the front of the check. Always copy the identification number and date of birth onto the front of the check. Always place your initials or I.D. number on the front of the check. Always place your initials or I.D. number on the front of the check. Always record the check writer's home and work phone number on the front of the check. Always record the check writer's home and work phone number on the front of the check.

27 What’s New? Notice of Dishonor by 1st class mail with affidavit of service Notice of Dishonor by 1st class mail with affidavit of service In 2009 the Texas Legislature amended the definitions section of the Texas Penal Code to include electronic checks, electronic debits, and automatic bank drafts. In 2009 the Texas Legislature amended the definitions section of the Texas Penal Code to include electronic checks, electronic debits, and automatic bank drafts.

28 Annual hot check sweeps Annual hot check sweeps Ten times as many criminal cases filed Ten times as many criminal cases filed Three investigators making arrests between sweeps Three investigators making arrests between sweeps Presentations available upon request Presentations available upon request Online Inquiry and forms Online Inquiry and forms All information is available on the web: All information is available on the web: What’s New?

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31 Jo Anne Bernal El Paso County Attorney 500 E. San Antonio Room 503 (915) www.epcounty.com/CA/ HOT CHECK SEMINAR