Posted by: Atty. Oliver Bulang | May 14, 2011

What Now, Estafa or BP. 22?

bankerscompliance.com


In commercial transactions, checks play a significant factor in the conduct of trade and business. Apart from ease and convenience of doing business, checks also facilitate a highly effective and efficient system of commerce.

Checks have long been used in business as early as 9th century. However, it was during the 20th century where checks gained its popularity as a form of non-cash payment scheme.

With the popularity of checks, however, came also a plethora of problems that attend commercial and trading systems. The issuance of unfunded checks by unscrupulous individuals brought serious repercussions to the market and the economy, in general. The Revised Penal Code, at one time, had been sufficient to address cases involving the issuance of unfunded checks. But the increasing ability of men to get around with the law rendered the Revised Penal Code unable to cope with the exigencies of business transactions. Thus the passage of B.P. 22 or the Bouncing Checks Law.

Everyday, we heard a lot of stories about Estafa and Bouncing Checks. For lawyers and law students, distinguishing the two is just a walk in the park. For laymen, a measure of confusion is not unheard of.

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 R.A. 4885)”

Requirements for a Person to Be Held Guilty for 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.

If any of these is absent, a person cannot be held liable for Estafa.

Example:

A bought goods from B and issued an unfunded check in consideration of the goods received.

In the problem above, A can be charged for Estafa because he issued a check knowing it to be without sufficient funds to pay the goods he bought from B. The issuance of the bounced check here was with fraudulent intent.

Bouncing Checks Law (BP 22)

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 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;

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.

Requirements for a Person to 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 issuance 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 presentment; 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.

Again, the presence of all these requirements is important. Otherwise, no BP 22 case can be filed. Note that knowledge of insufficiency of funds is presumed when t is proved 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 arrangement for its payment. Additionally, in BP 22, it is not a defense that upon the issuance of check you are not motivated with malice or fraudulent intent.

Adopting our example above, it would appear then that A can also be charged for Violation of BP 22, apart from the estafa case, because BP 22 cases also cover issuances of bouncing checks for value received right there and then.

So What is the Difference Between the Two?

It is Estafa when, among others, you issue an unfunded check with fraudulent intent in consideration of something of value you received.

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. Otherwise stated, you are liable for BP 22 whether you issue a check for a present or a past obligation.

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Responses

  1. What if a lending company gives you a 1st letter and it is a final notice after 2 years without any communication from them (they did not call or give me any notice) and that they will file a case of B.P. 22 bouncing check and estafa if I will not make a settlement about a certain amount that they say you have not yet settled from them.
    – I did not issue any checks or anything, they are the one who issued us checks and we withdrew it in the bank and then paid it by depositing certain amount to their account.
    And also, when I withdrew my membership from that lending company before I knew that I settled all my payment to them and talked to my lending officer. And now, I received that letter and getting worried if they will file a case to me

    • i also have problem with the same lending company..and the same problem,,and now they telling me that they will file a case against me..im so worried?what will happen if they file a case against me?im willing to pay it,,but for now i dont have enough money to pay for it?what would i do?

      • what happened to your cases? i have the same problem.now they say that they will have my name and my co-maker’s put in the newspaper. worse, they text every name that we put as references.

      • we have a same problem i really need some suggestion

    • hi atty. oliver i have issued two checks more that i cant funded it any more cause of i lost my job and i dont have income to fund the two remaining checks i issued fo and r P2,600 @ checks and now they file a case against me what will i do that i dont have money already to pay.

      • The best thing for you to do is to approach the person(s) to whom you have issued the bounced checks and make settlement.

    • dear atty nabasa ko po ung article ng BP22 kung sakaling msmpa po ito anong action ang pwede ko pong gawin?

  2. Hi,

    There’s nothing you can do but to go to the lending company and inquire about the notice of demand. I’m pretty sure they’ll work it out.

    Thanks.

  3. My friend lend money from me,he issued checks in every transaction he did.In order not to be stale the checks,he replaced using his wife checks.When i deposited in the bank it was closed account.Is there fraudulent intent on this situation?

  4. recently me and my wife borrowed some money for the hospital bill of my father in law to a certain person and in return we issued some checks. we made payment as promised but right now we are experiencing a lot and I think we are already bankcrupt. I tried to negotiate with the person who lend us the money but instead insisted that we should settle our obligationa or else file na case aginst us. I know that we should pay but what can we do if we’re already out of money. can they file an estafa case against us?

  5. Hi Atty, Oliver,

    I am an OFW and last year I got a loan from PJH lending company and they required my wife as co-maker to open a checking account and issued them 12 checks with amounts equivalent to my monthly payments. Although, I wanted to backout upon learning that the interest they charged was almost 80% of the principal loan, I had no choice because it was already the last day of my vacation and next day was my flight back to work. So we agreed without bad intentions but before our scheduled first monthly payment, Banco Filipino, declared a bank holiday and subsequently closed. We we’re then instructed by the PJH officer to just send our payments thru Cebuana pawnshop, which we did. But at one point, we failed to pay on a certain month but doubled the amount the succeeding month and continued to pay them until the scheduled last month of payment to complete our obligation totaling 147,600 pesos although the principal loan was only 87,500. Now, 4 months after we completed our payments, they called my wife asking to pay a balance of another 31k plus which they said incurred penalties due to the one month delayed payment which we covered the next payment month. They threatened to file estafa and bp 22 if we failed to comply.

    Questions;
    1) Is it legal to charge 80% interest for a loan?
    2) Could one be sued BP 22 even if the drawee bank already closed?
    3) Can one be sued estafa although he have already paid the amount loaned and with proof of payments?
    4) Can we sue the lending company if we can prove that we have already paid the principal loan plus the almost 80% interest?

    Thanks

  6. Hi! My father had a joint checking account with a colleague, which they opened for convenience and expediency, since his colleague is tasked to find an investor to finance their participation in the bidding for 2 projects. My father is the authorized officer of the company that is qualified to bid for these projects. Considering that it’s a joint checking account and they were pressed for time in complying with the financial requirements in bidding for the projects, my father entrusted to his co-signatory signed blank joint account checks.

    Afterwards, he found out that his co-signatory issued the check to a third person (the “Investor”) to whom his co-signatory owed money from for the sum of co-signatory’s personal debt (in millions) plus the P500,000 released for the purchase of bidding documents and bonds. Upon finding out, my father met with the Investor and his co-signatory to object to the issuance of the checks, the amount of the check and the maturity date of the checks. After some discussion, his co-signatory and the Investor convinced and assured my father that the checks were issued (and received by the Investor) merely as a guarantee that should the company my father represented win the contract for the 2 projects and the mobilization fund is released to the company, the Investor will be entitled to the sum represented by the checks which shall be deductible from the co-signatory’s share (the service fee for finding a financier) as return of her P500,000 INVESTMENT (no agreement that this sum is refundable in case they do not win the bidding) and she will be entitled to sub-contract the projects and the percentage of the contract price for these projects for work accomplished.

    Unfortunately, out of the 2 contracts, the company my father represented was awarded with only 1. The Investor, however, told them that she is not interested if she will be sub-contracting only for 1 of the 2 projects. So their relationship ended.

    Years thereafter, when my father attempted to get his NBI clearance, he found out that he and his co-signatory were sued by the Investor for BP 22 and Estafa by issuing bum checks. Upon finding out, he voluntarily submitted himself to the jurisdiction of the court (home town of the investor) and pleaded not guilty.

    Per Investor’s testimony in open court, my father found out that his co-signatory replaced the checks he co-signed with personal checks (of the co-signatory) the same day the Investor went to his co-signatory’s house to notify his co-signatory that she deposited the joint account checks and bounced.

    The Investor sued them as conspirators for the joint account checks and the replacement personal checks of the co-signatory which bounced.

    With the foregoing, may I seek your opinion on: 1) Whether my father can be convicted for estafa under Art 315, par. 2(d) of the RPC even though the Investor testified in open court, more than once, that she released the money MONTHS BEFORE she received the checks and that she released the P3M+ (the total face value of joint account checks) because my father looks appears good person and she knew they were awarded a contract for a different project. 2) Despite of the LACK of written notice of dishonor to my father, can the court legally apply the 2011 case you cited, based on the assumption/analysis that being a businesswoman, Investor would not have parted with her money if not deceived by the accused. 3) What possible strong legal defenses can my father invoke for the civil liability? Is replacement by the co-signatory, which complainant accepted, with her personal checks of any relevance to our defense? Investor was asked by the judge in open court if she understood, being a businesswoman, that the replacement and her acceptance of the joint account checks with the solo checks of one of the co-signatories meant that she can only go after my father’s co-signatory and she categorically responded “Yes”.

    Would appreciate to know our chances based on your assessment.

  7. my friend issued apost dated check and promises to pay me cash and told me not to deposit the check because he will pay me cash and i will give her back the check,, but untill now she didnt pay me and my problem is the check is already stale check.. can i still file estafa against her?

  8. hi..my friend is ofw..she borrowed money from lending for her placement fee..she advise to open a bank account for she is required to issue 12 checks pdc amounting to the payment so that incase my frend fail to pay her monthly obligation they said that they willencash the check…since she has no accnt her live-in partner issue checks name in his accnt..but my friend is did not finished her contract only 2 months..so she fail to pay..they expected that they encash 12 pdc check…after how many months not only 1 year they recieve demand letter telling that they didnt pay ther monthly obligation…an officer cameto ther informing that the company change management they forgot and fail to encash the said check..now the checks already stale check….and now the bank accnt is already closed…Atty. they can file stafa case to my friend?

  9. Hi I’m holding bounced check from the debtor but I can’t serve the notice of dishonor since the debtor can’t be found in her last known address, what would be my next step if I would like to file a case against her?

  10. Atty, what if upon the issuance of the bounced check, the “offended” party know that the offender has had no sufficient funds but still accepted the check and later on, sue the latter for estafa? will the case prosper?

  11. atty. what would be the best thing to do if a person entered into a contract of a telecommunication company for two years in having been a subscriber of their product load with a monthly of 500 it happens that the said person has not been subscribing the said product for 1 year only… Is that person liable for a breach of contract or what would be possible penalties she would suffer? is there any remedy for it? tanx

  12. Good afternoon atty.
    Im an admin officer of a distributor company… our salesman represents and do business for us.. it has been noticed that bounce checks have been rampant and we keep on reminding sales person to be careful in dealing with clients because colkection is there accountability. Can we repair losses from bounce checks by charging it to the salesperson?

  13. Gud am po!! May katanungan po sana
    ako sa inyo.
    May nagsanla po sakin nang bukirin at gumawa din po
    kami nang kasulatan na every harvest 10 sack of rice ang
    ibibigay nila sakin. Pero mula po noong nakuha nila yung
    pera at nakaharvest na sila nang maraming beses ni isang
    sako wala po sila binigay? Mag 4 na taon na po nakasanla
    yung bukirin nila sakin?? At ang bukirin na sinanlaan ko ay nagkakahalagang 40 tou pesos. At isa pa po nalaman nmin na nakasanla pa pala sa ibang tao ang bukirin isinangla sakin at nalaman ko lng dahil ang taong pinagsanlaan nila nong una ay kamag anak din nmin at di rin nla nakukuha yung kasunduan nila sa lupa.. Bale pangalawa ako sa nagsanla dun sa bukirin nila.

    Anu po ba ang pwede kong gawin or ikaso sa taong nagsanla
    sakin nang bukirin.???

    Please kindly email mary_rodam@yahoo.com

    Maraming salamat po!!

  14. Good Morning Atty.

    I would like to ask a question if that’s okay. My Ex boyfriend sent me money before amounting to 40k php when. I had a family emergency and he said that it was a gift. And few months later we broke up. Now he is trying to get the money back threathening to file a case against me. We did not have any wriiten signed agreement before. We went through everyhting verbally. Would it be possible for him to file a compalain against me?

    Waiting for your king response. Thank you.

  15. Dear Atty.,
    I am writing u to request a free legal advice for the case filed against me from a lending company.
    August 27, 2014 I was given a subpoena as a final hearing to appear in MTC in branch 22 Manila. I called the lending and told I am in UAE now so I cannot attend my court trial. They gave me an option to send any of my representative and bring even half of the 65,000 loaned amount in 2010. We were required to open an account and issued a blank checks without my name appeared in that check.
    Now I sent my brother at the day of hearing and paid 10,000 pesos only for I cannot provide such full or half amount of my loan.
    Will I still be issued for a warrant of arrest? Will I be charge for an imprisonment still though I am paying now 5,000 monthly?
    Am I liable to pay the attorneys fee added in my loan? They charge me 80,000 pesos and verbally they agreed on my request to pay 5,000 pesos monthly which started last September salary, I already paid 15,0000 pesos and before 2010 I paid 5,000pesos and some certain amount.
    I just want clarifications to ease my worries and to have peace in mind.
    Can I still enter my home country Philippines? Am I still a free person or I will really have to face imprisonment during my vacation?


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