In a significant legislative shift, the UAE decriminalised bounced cheques in 2022, aiming to streamline financial disputes and reduce legal burdens on businesses and individuals.
This change, however, excludes instances where cheques are issued in bad faith, primarily targeting cases of fraud.
Under the new law, bounced cheques are no longer subject to criminal prosecution, except in cases of fraud. This legislative update allows banks to release any available funds from the issuer’s account to cover the cheque, provided the account holder does not object. Beneficiaries who encounter a bounced cheque now have the option to resolve the issue either through mutual consent via a police report or by pursuing legal action in court.
Penalties for Fraudulent Cases
Despite the decriminalisation, certain bounced cheque cases remain punishable by law, specifically those involving fraud. Individuals found guilty of fraud can face fines ranging from Dh20,000 to Dh100,000. This measure aims to deter fraudulent activities while simplifying the resolution process for genuine disputes.
How to File a Report for Bounced Cheques
Beneficiaries looking to address a bounced cheque through the police can follow a straightforward process. Here’s a guide on how to file a report:
Eligibility Criteria
- The incident must have occurred in Dubai.
- The merit period of the cheque should not exceed five years from the date of issuance.
- The cheque must not be bounced due to expiry of the merit period.
Documents and Information Required
For individuals:
- Image of the bounced cheque.
- Copy of the Emirates ID.
- Bank’s notice about the bounced cheque.
For companies:
- Copy of the bounced cheque.
- Copy of the trade licence.
- Bank’s notice about the bounced cheque.
- Complaint letter addressed to the police department in Arabic.
- Report issued by the company’s manager or an authorised representative.
Additional documents may include:
- Valid email ID.
- Image of legal authority documents and original copies.
- Emirates ID of the cheque recipient.
Filing Process
The process to file a report is free of charge. Beneficiaries can submit their reports through the Dubai Police website, Dubai Police app, or at smart police stations. Upon submission, applicants will receive a transaction number and receipt via email.
This reform simplifies the legal process for handling bounced cheques and enhances transparency while maintaining strict penalties for fraudulent activities. For further details or assistance, individuals and businesses are encouraged to utilize the smart channels provided by Dubai Police.
News Source: Khaleej Times
