We’re pretty sure there’s a point in time that you became party to a transaction, either as payee or payer. Of course as payee, receiving cash is much preferred as you are sure that your payment was given to you in full sans any further action needed from your end. Now as a payer, issuing a check is so much more convenient, especially for substantial transactions, as you would not have to worry about bringing cash and making sure that all your expenses are accounted for and debited, down to the last centavo.
It’s great if all transactions went smoothly without any hitch. However, with both parties making and receiving payment all in good faith. But what if you were conned by someone you had the mistake of trusting? Or what if you issued a check as a show of good faith to close out on a deal but at the time of issuance, the account has insufficient funds and you made a mental note to replenish the account as soon as you got paid. Alas, you then notice that your check bounced.
The above instances had surged over the years and caused an unfortunate chain reaction which prompted the filing of either or both of the following cases: Estafa and Violation of Batas Pambasa (BP) 22 or the Bouncing Checks Law.
Estafa Through Issuance of Unfunded Checks
The crime of Estafa is punished under the Revised Penal Code. One can be held guilty for Estafa by means of issuing a bouncing check with the use of false pretenses or fraudulent acts executed prior to or simultaneously with the commission of the fraud:
“By postdating a check, or issuing a check in payment of an obligation when the offender had no funds in the bank, or his funds deposited therein were not sufficient to cover the amount of the check. (Article 315(2)(d) of the Revised Penal Code as amended by RA 4885)”
How can a person be held guilty of Estafa?
Under the RPC, the following elements are necessary to hold a person guilty of Estafa:
1. Postdating or issuance of a check in payment of an obligation contracted at the time the check was issued
2. Insufficiency of funds to cover the check, and
3. Damage to the payee thereof.
The most important element here is the damage caused. Absent any of the following elements, a person cannot be held liable for Estafa.
Case in point:
Andres owns and operates a trading good business and bought merchandise from Bonifacio and issued an unfunded check in consideration of the goods received.
In this scenario, Andres can be held liable for Estafa because he issued a check knowing it to be without sufficient funds to pay the items he bought from Bonifacio. The issuance of the bounced check here was with fraudulent intent.
Bouncing Checks Law (BP 22)
Unlike Estafa which has its basis under the RPC, BP 22 is enacted through a special law. A person can be charged for violation of BP 22 when he commits the following acts:
1. Making or drawing and issuing 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 presentation, 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;
2. 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.
How can a person be held guilty for Violation of BP 22?
Violation of BP 22 can be filed against any person when the following are present:
1. Making, drawing and issuing of any check to apply for account or for value;
2. 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 such check in full upon its presentation; and
3. 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.
Same with Estafa, the presence of all these requirements is important. Otherwise, the charge of BP 22 will not attach. Note that knowledge of insufficiency of funds is presumed when it is proven that the issuer received a notice of dishonor and that within 5 days from receipt thereof, he failed to pay the amount of the check or make arrangements for its payment. Additionally, in BP 22, good faith is immaterial. Meaning, the mere issuance of an unfunded check already consummates the crime.
Using the same example above, Andres can also be charged for Violation of BP 22, other than Estafa, because BP 22 cases also cover issuances of bouncing checks for value received.
Where does the disparity lie?
It is Estafa when, among others, you issue an unfunded check with fraudulent intent in consideration of something of value you received. Here intent is material and good faith may be used as a defense.
It is a case for Violation of BP 22 when you issue an unfunded check whether or not it is for an obligation you contracted prior to the issuance of the check or not. Simply put, you are liable for BP 22 whether you issue a check for a present or a past obligation.