KATHMANDU, June 5: The cases of bank cheque bouncing have increased massively in the past few years, due to an increasing financial fraud and economic slowdown that appeared in the post pandemic period.
The records with Nepal Police show that they registered 7,762 complaints against bank cheque bouncing in the first 10 months of the current fiscal year, which were almost four-fold compared to the complaints received four years ago. In the fiscal year 2020/21, Nepal Police received 1,997 complaints on this issue.
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According to the Kathmandu Valley Police Office, most of the cases of cheque bounce that it registered involved amounts ranging from Rs 50,000 to Rs 10 million. Superintendent of Police and spokesperson for the District Police Range, Kathmandu, Nawaraj Adhikari said a large number of complaints were related to unmatched signature, dormant bank account, loan sharking and not revealed income source of check issuers. According to him, out of 7,762 complaints registered in the review period, the police office took 4,773 cases to the court.
The law has categorized 12 cases in banking offenses, and cheque bounce is one of them. If a bank cheque is not cleared three times within six months from the date of issue, it is considered a bounced check. According to the law, there is a provision allowing a complaint to be filed with the police after the concerned bank issues a bounced cheque letter indicating that there are insufficient funds in the account.
After a cheque bounces, the concerned person is blacklisted by the bank while their movable and immovable property with the bank are frozen. Additionally, the police can record the accused in the criminal record system and can remand them for up to 60 days for investigation.
Along with a surge in bank cheque bounces, there is also a whopping rise in the number of blacklisted persons and firms during mid-July 2023 and mid-May 2024. The records with the Credit Information Bureau show that the bureau blacklisted 40,034 individuals accused of the banking offense. Of the blacklisted, 70 percent were related to check bounce.
