Can you face imprisonment and travel ban in cheque bounce case?

Posted by Dr. Hassan Elhais on January 31st, 2021

As opposed to other methods of payment used by individuals or organizations in the world, issuing and receiving a cheque requires a leap of faith as the receiver of the cheque solemnly believes in the issuer at the time of accepting the cheque towards the payment due. Nevertheless, more often this faith or belief is broken when the issuer has ill-intent while writing the cheque or never had the intention to pay the receiver. In such circumstances, the law of the land comes to fair play and allows the receiver to claim what belongs to him. Now that we understand the importance of legal procedures in cheque bounce cases, we must now understand how stringent and serious the punishments for this crime is and how easy or difficult it is for the government to implement such rules and regulations. 

Criminal Lawyers in Dubai often discuss and enlighten their readers about new rules and regulations pertaining to cheque bounce cases and how one can seek legal redressal in such disputes. Apart from the earlier discussed criminal or civil legalities, the particular article will specifically discuss the criminal consequences of issuing a cheque that was later dishonoured by the bank. 

What will lead to imprisonment? 

In the UAE, the cheque bounce is a typical issue that individuals face in personal or professional front. Without a doubt, a cheque bounce case is a criminal offense in the country and it may erupt in any sort of commercial transactions between natural and legal persons. 

There are some wide-spread misconception relating to criminal arguments against cheque  bounce. Most of our clients or other individuals believe that all cheque bounce cases lead to imprisonment, whereas some believe that all cheque bounce cases can be easily removed by paying fine to the relevant courts. Ergo, Criminal Lawyers of Dubai will help you understand the criminal liability and consequences of bounced cheques issued in the country. 

In accordance with Article 401 of UAE Federal Law No.(3) of 1987 on the Penal Code “Confinement or a fine will be forced upon any individual who, in dishonesty, gives a draft (cheque) without an adequate and sufficient balance or who, subsequent to giving a cheque, pulls back all or part of the amount, making the amount insufficient for repayment of the cheque, or on the off chance that he arranges a bank to not release the payment towards the given cheques or signs the check-in a way that keeps it from being liquidated.”

In line with the foregoing provision, the standard rule dictates that the criminal court shall impose imprisonment or fine on the individual who issues a false or dishonoured cheque, however, with the latest amendments in the Penal Law, it was made clear that all cheques below the amount of AED 200,000 (UAE Dirhams two hundred thousand) shall only face fine of a specified amount and the case will be presented before the public prosecutor. However, for any cheque above such amount, the case will be referred to the relevant Criminal Court for an adequate judgment, which may involve a fine or imprisonment as the court may deem fit. In addition, as a standard rule, an automatic travel ban is imposed on the individuals or managers or signatories of the cheque at the time when the criminal case is registered or when accepted by the public prosecutor to prevent the individual to leave the country. It is, therefore, advised to appoint Best Lawyers in Dubai in case there are any charges against you for cheque bounce or even when you wish to file a criminal case against other individuals. 

Article by: Dr. Hassan Elhais, a legal consultant in Dubai, specializing in the drafting of all statements of claim, memos, and consultation on litigation of all manner.