Over 3,000 cases of bounced cheques

Lieutenant Colonel Fahad Al Hosni, Assistant Director at the Criminal Investigation Department of Muscat Police Command, said: “There were 3,054 cases of bounced cheques registered with the ROP in 2018, compared to 2,963 cases in 2017. Muscat topped other governorates in the number of bounced cheques with 1,920 cases because it’s the capital and densely populated.”

He added, “In case the cheque is dead, the cheque will be referred to the ROP and Public Prosecution and then to courts. Many also committed fraud by tampering with their cheque’s signature as they didn’t have enough money in their accounts.”

Customers’ cheques

Lt. Col. Al Hosni also added that banks who refused to honour customers’ cheques without providing a convincing reason would also be penalised, adding that many citizens and residents who tried to pay using bounced cheques normally used them for either impulse buys or frivolous items that they actually did not need.

He also urged those who intended to sell their real estate properties to make sure that the cheque is certified before they surrender the property to the buyer.

“They have to make sure that there are sufficient funds for these cheques,” he added.

In addition, Ramanuj Venkatesh, a financial analyst in the country, said cheques shouldn’t be accepted from those people who had a bad reputation of not properly honouring cheques on time.

Doubtful cases

“We don’t know that person’s financial situation, and previously, in cases of work, I have come across people who have not been able to pay money on the due date, so we often consider such people to be doubtful when it comes to paying their dues, and this affects your reputation as well, because it will impact on your financial situation and how others see it as well.

“This is also one of the reasons why some supermarkets say they don’t accept cheques anymore,” said Venkatesh.

“This is essentially an undertaking from the person who owes money to the person who needs the money. What if the person buys the item, issues a bogus cheque and then absconds from the country? This will negate the purpose of making the payment on the due date. Supermarkets have goods that are fast-moving, so they need money quickly. In any business, after the business is done for that day, the cash is counted, and often, what is looked at is what customers owe the business, as opposed to the physically present cash balance to ensure the figures are proper.”

Fund transfers

He added that more and more companies were moving towards electronic fund transfers, so as to avoid the doubt that sometimes came with issuing a cheque, particularly from those who had a reputation for not paying for goods and services on time.

“I’m sure there are people wondering how bounced cheques affect people and businesses negatively, because they may not know of the consequences,” Venkatesh told Times of Oman.

“A cheque is a negotiable instrument that can be changed or altered by anybody, in any place in the world. When I used to disburse cheques as part of my work, our procedure used to ensure that the cheques would only be made out to the holder of the account to whom the cheque was being paid. Otherwise, if we write the cheque to anyone, then any person can take it and use it for the wrong reasons.

“That person will wrongly profit from the money going to his account, and this is disadvantageous when it comes to using manual cheques that have been around for a long time,” he added.

“That is why, these days, companies are moving towards electronic fund transfers, because they are a safer way to transfer funds from the sender to the receiver. This is faster, safer and more efficient as opposed to writing a cheque.”

Bouncing a cheque was the number one crime in Oman in 2017, according to Public Prosecution data.

Most reported crimes

Issuing bounced cheques topped the list of the 10 most reported crimes in Oman in 2017.

A total of 4,716 overall chequerelated cases were recorded in 2017, compared to 5,470 cases in 2016.

Muscat topped other governorates in cheque crimes with 2,270 cases, followed by North Batinah, which registered 499 cases.

According to the Central Bank of Oman, insufficient funds continue to lead the list of reasons for bounced cheques (74.88 per cent), followed by accounts that have been closed or “legally blocked” accounts (9.79 per cent), and bank encoding errors (4.05 per cent).