What's The Worst That Could Happen?

[CindyLou]

As for the bank, they will try to collect the $$ and they will notify Chex-systems which will ban her from opening another account with any other financial institution.

This is actually a case where chex systems will be doing what they were meant to do!! To keep a person who is abusing a checking account from repeating it again. Hopefully your relative can get some help. Has anyone suggested a support group like debtors anonymous to her? It is similiar to AA. I know she may not be open to it, but is can't hurt to suggest it. Keep us posted. I agree about not lending her money. In this situation it would be just like giving a drug addict access to drugs. This is a serious situation.

[Annika]

Sorry to be so long in getting back. We've got a septic tank or line problem, and it's got everything in a mess (literally).

annika - I am always of the opinion that, unless you know 99% sure that any $ help you give a friend or family member will permanently fix their financial problems - don't do it!

Buying them dinner or a gift is one thing, but beyond that, no.

Sounds like she has a major problem running her financial life.
She should simply STOP and use this rule: If she can't pay cash, DO NOT buy it! It also sounds like she lives hand to mouth, which also is unfortunate. But she has a problem, and needs to admit it and commit to fixing the problems. You can help with that part, to support her.

Good luck!

Agree 100%!.. Do not help her financially anymore if she asked for $$... but give her and her hubby this web site link/pointer so they can both learn and well-managed their financial ruins before... well... too-late-filing-for-a-fresh-BK happens!...

Giving/lending her money isn't an option ... I have little myself. She's borrowed money from our parents (they're divorced) several times, but she still owes our dad some money. He's rather annoyed that she hasn't paid him back for a previous loan, yet she comes back and asks to borrow more. I'm sure next time he'll tell her no, especially since we found out about this other stuff she's done!

I've given her groceries on occasion, and coupons for stuff I know she buys anyway. (I'm a major Coupon Queen.)

Hi Annika - glad you came back to see us! We've missed you!

Agree with the advice you've already been given plus I have another suggestion to add....

Your "family member's" husband really needs to get involved here. The two of them need to sit down once a week TOGETHER to sort out who's going to be paid, when they will be paid, and how much. Being held publicly accountable helps the credit-addicted (which is the real problem here) stay on the straight and narrow much longer than promises which can impulsively be broken when triggered by the right circumstances.

Wish I had done this myself with my own "family member"....but I didn't and that's how we ended up in Ch 13 bankruptcy

Thanks!

Yep, she tries to keep their finances a secret, especially when she makes a mistake. She did the same thing with her ex-husband. She applied for oodles of credit cards, and ran them up, and he had no earthly idea. They filed bankruptcy.

And here she is, keeping secrets again.

It almost sounds as if there may be emotional issues with your family member as well---depression/bpd perhaps, with the credit addiction/money issue as a symptom. It might be worth the effort to at some point suggest counseling (some clinics offer sliding scale).

I hope I didn't offend.....

-sue

No offense taken. You're exactly right. She's been diagnosed with depression and some other issues, and is on prescription medicine, however, I'm fairly certain that she hasn't discussed her financial problems with a doctor.

She did try to work with a credit counseling service, but either she or they cancelled it (my gut feeling tells me it was the latter!).

Are you my sister talking about our Mother??????? Seriously???????? Our Mom JUST did this AND we found out she's 10 months behind on rent and JUST got the eviction notice. Her husband left her yesterday (not our DAd).

Our Mother did this 20+ years ago and ended up with a conviction of bad check writing. I don't know if they still do that, I'm assuming yes, but maybe now it's for higher amounts?

I'm sorry to hear that! Hope things get better for her.

Yes, people still "do time" for writing bad checks..........depending on the amount/quantitiy of checks determines whether they do their time in county jail or "big house".....

If someone in your family is having serious depression/emotional problems and their finances have turned upside down, help them get professional counseling for their depression/emotional problems. Try your best to get them to see a doctor and talk it over.

If it is a parent - get all siblings together and confront that parent and let them know your there to help them and get their lives back on track.

Its hard, and many will "balk" on you, but at least you will know you have tried to help them and give it your best effort. After that, their on their own...... make it or break it.....

You can't help someone who won't help themselves......

I've tried talking to her about it, but she won't readily discuss it. The e-mails in my first post are the first time she's ever voluntarily talked about it. Maybe that's a good sign.

IMO, the way she was writing checks is definitely similar to someone funding an addiction of some sort.

Yes, if the bank wants, due to the way those checks leave a paper trail, she could very well be setting herself up for check fraud and could easily go to jail/prison for committing fraud.

Please, tell her to stop!

I'll definitely pass this information along to her!

"Check 21" is what is new with check processing. What your family member is attempting to do is called "Check Kiteing" and it is illegal but she probably won't get busted for it, but she could be in big trouble for writing hot checks, as you know.

It sounds like these were relatively small amounts, less than $200.00 each. Check out your state laws for the amount required to trigger the various level of charges.

This is one time where sticking her head in the sand will get her in more trouble. If the checks are returned to the merchants, she will have some time before they turn them over to the local D.A, so she needs to get busy with getting the money together to pay these off before they do turn them over, including the fees the merchants are going to charge. I highly suggest she have a garage sale if necessary to raise some cash quickly. It wouldn't hurt her to give up a few prized possessions to get herself out of this mess...maybe she would learn a lesson.

Personally, I would pay the merchants before I pay the bank. The bank can write off the amount and it goes against her credit but the District Attorney can do a whole lot worse than that. Close the bank account, or work out something with them if she wants to keep the account open. Possibly the bank will convert the fess to a loan she can pay out over time, but the most important thing is to keep those checks from going to the District Attorney.

However, I have heard of people making payments to the local D.A.'s office for bad checks without being prosecuted. Once they are turned over, she need to take the initiative with the day, not wait for it to go to a warrant.

Let me stress one more time, she can not ignore these checks if they are returned to the merchants.

Good luck.

Now for the lighter side of this: I had a coozie once that read..."I can't be overdrawn, I still have checks." This is the coozie I used everyday while in college.... majoring in accounting. he he he

Wow. I had no idea what she's doing actually has a "name". I've looked up some information about it, and am going to have a serious talk with her. Bad thing is, she's an adult, and I can't exactly "make" her do anything.

She thinks all the most recent checks have cleared. I hope she's right, and that she's being truthful with me. (She used to live with us, and I've caught her in lies several times, so ... )

I agree with Granny. She should take care of the merchants first. They would be the ones to press charges for writing bad checks. As for the bank, they will try to collect the $$ and they will notify Chex-systems which will ban her from opening another account with any other financial institution. Her best way to go after this is money orders only. Some people just are not good with a checking account, debit card, etc....These are usually the people that banks love.....lots of fee income. I hope everything works out for your sister.

Yep, she's definitely making the bank rich!

Granny pointed out Check21. The New Law that allows Debits to clear before Deposits are credited. It's a Law that Banks lobbied hard to get. That's a big part of the reason your friend cannot "beat the Bank". The law is on the Bank's side.

Another thing that can happen with your friend's acct,......... Depending on the Bank's Policy,........... Every day her acct is NSF, the bank could be adding charges for the NSF status. So the $400 NSF balance could have grown. Your friend needs to check on that too.

Thanks! I'll tell her to check on that.

As others have said, your friend has a problem. Basically, it's a gambling addiction. She's not going to casinos but she's gambling none the less.

Giving her money to bail her out this time won't help. She'll just start another vicious cycle sometime in the near future. Until she faces her demons, she's not gonna be able to move in a positive direction.

Yep.

I'm gonna echo many of the others here. Though it is painful, I would not loan your 'family member' any money.

She had a bankruptcy 4 years ago
She already messed up one deal with the bank that was 3-4 months ago. (Her friend that helped get her NSF removed is probably having to answer to her boss now).
She's back in the same situation.


Essentially her and her husband need to go to a cash and carry policy. It sounds like their bills may exceed their income.

Yep. My dad says she has "champagne taste but has a beer budget".

Its a painful lesson. Clearly she can't declare bankruptcy again.

You can still do time for check fraud.

(Incidentally Wal Marts everywhere instantly take out your funds, same with Roses and some other places.)

Most likely you mentioned that she's not been paying her credit cards either for about a year. She's probably going to start hearing from them soon too.

She used to live with us, and she was getting collection calls and letters even before she moved out. I had to have our phone number changed due to the number of phone calls coming in (my husband works nights). I also had to repeatedly ask her to change her address so that all her mail would be sent to her new place. She didn't want to, and actually got mad at me for mentioning it.

She needs to sit down with her husband and let him know how bad the situation is. Then together they need to figure out a plan to get out of it, which might necessitate her taking on a job or two or three.

Since they can't file bankruptcy I might suggest Dave Ramsey's book Financial Peace, and possibly if they can attend his Financial Peace University. (Many churches offer the program).

I wish them luck.

John

Thanks for the suggestions!

I hate to disagree with SinkingFast, but Check 21 didn't change the order in which items are posted, that's a decision made by each bank. Check21, which is federal, paved the way for faster posting of withdrawals, either by debit cards or checks. The biggest impact here was in checks because Check21 now allows for electronic versions of checks to post immediately. This is why Wal-Mart hands your check back to you, they have processed the check as an electronic transfer. With the passing of Check21, any merchant (and this includes credit card payments made by check) has the option to process your paper check as an electronic check and it happens overnight, even through 2 different federal reserve branches. In essence, the only float now is with the post office for checks that are mailed.

Her husband needs to do wht my BIL did to my sister, who is famous for this. My sister went a step worse..many steps, by saying someone 'stole' her debit card to her hubby who then kicked out his future DIL after blaming her!!
ANYHOW, HE NEEDS TO BUY A LOCKBOX!! Only he must know they combo or hold the key. He must then put the checkbook, bank info and CC's inside. He must do ALL banking and check writing until she gets help. If she needs to shop, he will have to be with her. Or give her limited CASH to use. I know my sister STILL has to be treated this way, like a child. Stinks, but some people never learn.
I am shocked her hubby hasnt kicked her out. He must be a good guy. My BIL and sister nearly divorced.
Bad news is my sister went out and applied for more credit in her name and managed to rack up 20K in a year. She has NO CLUE what she even bought.
Some people..
WAM

This is actually a case where chex systems will be doing what they were meant to do!! To keep a person who is abusing a checking account from repeating it again. Hopefully your relative can get some help. Has anyone suggested a support group like debtors anonymous to her? It is similiar to AA. I know she may not be open to it, but is can't hurt to suggest it. Keep us posted. I agree about not lending her money. In this situation it would be just like giving a drug addict access to drugs. This is a serious situation.

Thanks again for the suggestions! I'll pass all the info along to her.

If only I could "ground" her!

[Minnymouth]

Since she is supposedly an "adult" - put it too her like this:

You want me to "help you" you HAVE TO DO THIS, AND THIS.... otherwise - NO WAY................you got yourself in this mess - get yourself out!!!

Its called "tough LOVE"..... and sometimes its just plain necessary.....

Be point blank with her - don't sugar coat it - and remind her there's a good possibility she could go to prison for 1-5 for her actions....... writing bad checks is a felony......

See what she does, and how she reacts...... if she whines and moans - tell her 'GROW UP"...........

You can only help her so much....... and that's it...... the rest she has to do herself.....

[Spartan]

As soon as Chex system catches up with her, in a few months, the gig is up. Flagged with ABUSE, she will be on 'cash and carry' for 5 years.

[Run]

How does direct withdrawal factor into this. We stopped paying our bills because we couldn't but I think that our bank payed a few bills after our account went negative. If it came out of a checking account would it be the equivalent to bouncing checks and thus check fraud? We had overdraft protection as well. I am just confused as to what makes the difference between not being able to make your bills anymore and fraud? We didn't bounce any checks or charge anything beyond our limits, but we are negative on our checking account I am sure. Help please.

[lrprn]

How does direct withdrawal factor into this.

If your bank used your overdraft account to cover automatic payments that creditors requested, then when you file bk you list your bank's overdraft protection account on your non-secured creditor list. Whatever you owe on the overdraft account will get wiped out in Ch 7.

[Run]

I was just concerned that they might look at it as check fraud since it came from a checking account and it went over via multiple withdrawals. I did not get any bounced check fees just subscriber service canceled and life insurance policies not getting paid. Just worried when I read about the potential of spending time in jail for something unintentional and out of our control (aside from our ability to cancel services before they withdrew the funds etc...).

Thanks.

[Annika]

I just wanted to post an update, and unfortunately it's not a "happy ending".

Since I posted, she's gotten FIVE letters in the mail ... basically arrest warrants ... giving her 10 days to pay those bad checks PLUS fines PLUS court costs, or else she was going to jail.

I don't know all the nitty gritty details, but apparently the judge waived the court fees on the first two checks since they were her first offense. She had to pay the full amount on the other three, which came to around $1,000 total.

She told me that all the checks were for less than $35 each. I'm sorry, but DUH!!!

She called her ex-husband, and he's the one who gave/lended her the money.

Her husband has NO IDEA. She's managed to hide the letters from him, and he has NO IDEA that her ex bailed her out. If he knew, he would blow a fuse.

So ... now ... she's still got more bad checks out, and to try to hide the expected letters from her husband, she's having the post office forward all of her mail to a PO Box. (Edit: She originally wanted to forward her mail to MY address, and I told her HECK NO!) She's also got two of those payday loan places chasing her. She said she owes them around $110 total.

I advised her to call the stores she owes money to, and settle up, before she ends up having to go back to court, and paying another bundle of money that she doesn't have. She's again saying that these other checks are less than $35 each.

But as of yet, she hasn't called them.

And I seriously doubt her ex will give her any more money. I know we, and the rest of our family, aren't in the position to help her, nor do I think we should.

And she's officially wrecked THREE bank accounts now, at different banks. I'm still unclear as to how she was able to open additional bank accounts when she's in trouble already. The local stores have cut her off. Nobody will take anything but cash or a prepaid debit card from her. Just as well!

Bad thing is, two weekends ago she and her family went on a mini-vacation to Gatlinburg ... when just the money they spent on GAS ALONE could've paid for those outstanding checks.

Unbelievable, huh? It just blows me away.

[BROKENN]

I know this won't be popular, but if she has a husband, maybe kids? Maybe you should tell the husband.......

This is bad. And I am sooo sorry for you. My heart goes out to your family.

[Annika]

I know this won't be popular, but if she has a husband, maybe kids? Maybe you should tell the husband.......

This is bad. And I am sooo sorry for you. My heart goes out to your family.

Thanks, I appreciate it.

Edit: Yes, she has a son with her ex, and her husband has two kids from his ex.

Hubby and I discussed telling her husband, but decided not to, at least for the time being. He's no better at handling money than she is, plus when he's mad at her -- justified or not -- she says she has panic attacks. I honestly don't know if that's true or not. I've known her for 35 years, and have never actually seen her have any difficulties, but I guess it's possible. And she does have a history of minor heart problems (mitral valve prolapse (sp?) that she says gives her problems when dealing with stressful situations).

It's hard to know what the right thing to do is, under the circumstances.

[BROKENN]

Well, I hope the husband and children won't be collateral damage from this. Its worse when someone won't take responsibility and effect others in doing so.

I am glad that you aren't giving her any money, because it won't help. And you are trying to build your future! Take care, I wish you the best.

[Flamingo]

To the OP - I read all these postings. We have a similar family member situation. What it all comes down to is that your relative knows that whenever she does what she does, she will get bailed out or someone will lend her money. It all has to stop for her to eventually figure out her issues. Our family contacted everyone involved with our relative and we all vowed not to lend any more money to our relative because it was just a vicious cycle and we are all owed money by our relative and they have even taken gift cards we have sent their kids for birthdays or Xmas. We all find out the gift cards never got to the kids. It's all a matter of tough love. Plus you have to take care of yourself and your own family. Your relative needs support from everyone in such a way and no cash spigot turned on anymore from anyone.

[Over our heads]

Seriously, you need to let her husband in on all of this deception. Like it or not, this will be effecting him, and any children in the home, regardless of who they belong to. You say he is no better financially, yet he is not the one dancing with a jail cell.

Yup he is going to be mad, and rightfully so. His name/credit will be dragged through the mud with her shenanigans.

Tough love...it sucks but is necessary.

[epiphany]

If there were no kids I would tell you to blow it off and tell her to stop discussing it with you.

But since there are kids involved, I think you have an obligation to tell her husband.

Just my harsh two cents. I understand how difficult this is for you. But it's going to end one way or another, and you do have some power.

Sucks and I'm sorry.

ep

[Flamingo]

I believe the husband is aware of most of what is taking place but is an enabler of sorts. It's hard to hide any major financial trouble in a household. What has to happen here is that the safety valves have to be turned off for a while for their entire house to either reorganize or blow up. That is the only way that family will learn. I feel real sorry for the kids but something has to go down and change before anything gets better.