Dubai takes the case of bounced cheques seriously, and the consequences can be severe.
In Dubai, as in many other jurisdictions, issuing a bounced cheque is considered a serious offense, and the consequences of such an act can be severe, both legally and financially.
Legal Consequences:
Criminal Offense: Issuing a bounced cheque in Dubai is a criminal offense under UAE Federal Law No. 18 of 1993. The law holds individuals responsible for honoring their financial obligations. The cheque is returned due to insufficient funds or a closed account.
Penalty: The punishment for issuing a bounced cheque in Dubai can range from fines to imprisonment. The severity of the penalty depends on the amount stated on the cheque. For amounts below AED 200,000. The offense is considered a misdemeanor, punishable by imprisonment for up to one year or a fine. However, for amounts exceeding AED 200,000, the offense is deemed a felony, carrying a prison sentence of up to three years.
Travel Restrictions: Those accused of issuing a bounced cheque may face travel restrictions imposed by the authorities. This measure ensures that individuals do not leave the country before resolving their financial obligations.
Financial Consequences:
Financial Liability: The issuer of a bounced cheque in Dubai is still obligated to settle the debt owed to the recipient. Therefore, even if the cheque bounces, the individual remains responsible for payment. This can lead to additional legal action, including a civil lawsuit to recover the funds.
Damage to Creditworthiness: Issuing a bounced cheque in Dubai can significantly damage one's creditworthiness and reputation. Credit bureaus in the UAE maintain records of such incidents, and financial institutions and other creditors may consider these records when evaluating credit applications in the future.
Blacklisting and Employment Issues: Individuals who issue bounced cheques in Dubai will be blacklisted. Being blacklisted can hinder access to banking services, credit facilities, and even future employment opportunities in the country.
By understanding the legal and financial implications, individuals can avoid the detrimental consequences associated with issuing a bounced cheque in Dubai. It is advisable to obtain legal advice from an experienced cheque bounce lawyer. To navigate the complex legal system and protect one's financial interests in case of any ambiguities or disagreements.
For any legal queries or information, contact ask@tlr.ae or call us on +971526443004
