• When you write a check, you are entering to a legally binding agreement with the payee. The recipient of the check is taking your word that you have the funds available in your account to complete the purchase and transfer the money in exchange for goods or services delivered. If the funds are not available in your account and the check bounces, there are many consequences, and they can range from aggravation to incarceration.
  
  

Fees

• If you write a check for an amount that is not available in your bank account, your bank will process the check on your behalf if the amount is small enough. This will leave you with a negative balance and subject you to nonsufficient funds, or NSF, charges. The fees vary by bank but can range from $10 to $75 or higher for each bad check written. The fees may continue to mount for each day your balance is negative, even if there are no more withdrawals coming out of your account.
  
  

Embarrassment

• Many times, bad checks are written and the depositor does not even know the check is bad. However, if your bank chooses to dishonor the bad check, the word will quickly get back to the person you paid. People do understand that mistakes happen, but it can be embarrassing to get a call from a friend or merchant about the bad check you wrote. In addition to the embarrassment, the payee who received the bad check may also ask you to cover the bad check fees assessed by his financial institution in addition to the NSF charges you were assessed at your bank.
  
  

Suspension of Check-Writing Privileges

• If you write enough bad checks, your bank can suspend your check-writing privileges. Banks take on a great deal of administrative work to deal with a bounced check, and despite the fees charged, it is not worth their time to deal with. If you habitually write bad checks, your bank may disallow you from using checks in the future.
  
  

Blacklisted

• Many merchants use electronic processing to validate checks. These systems share information, and if you have a bad habit of writing bad checks, some systems may red-flag your checks. The merchant may be warned about your risk level and choose to ask for another form of payment. In some instances, the electronic check processing system may disallow your check transaction to process. The same blacklisting consequence can also happen at individual merchants. The store simply may choose to not conduct business with you anymore.
  
  

Closure of Account

• Despite the high amount of fees earned by banks on processing of bad checks, banking institutions do not like high-risk customers. A bank may simply choose to close your account if they feel your bad check writing habits are causing more problems than you are worth as a customer. This can sometimes happen automatically without your immediate knowledge and cause your debit card purchases and ATM withdrawals to be rejected.
  
  Even worse, since your account is closed, you may not longer be able to receive direct deposits. Finding a new account on short notice can be difficult, especially if you missed out on a paycheck. Other banks may also be hesitant to open an account on your behalf while another bank account is in arrears or is reported as a high-risk account.
  
  

Collection

• If you do not settle the debt you triggered by writing a bad check, you may be subject to collection action. Your banking institution can send out a collection notice to collect any negative balance in your account and the merchant can also submit you to collections. This can result in aggravating phone calls and even negative reporting on your credit report.
  
  

Arrest Warrant

• Writing a bad check is a crime, and each state has its own set of penalties associated with it. While it is more serious to write a bad check for higher amounts, any bad check, regardless of the size, is a violation of the law. If the merchant or payee pleases, he can go down to the local law enforcement station, complete some paperwork and have an arrest warrant issued. Typically, law enforcement will not spend much effort pursuing someone that wrote a bad check for a small amount. However, if the person who wrote the bad check gets pulled over for running a stop sign, he can expect to be cited for the traffic infraction and likely arrested on the spot.