Action against rubber cheques
Firas Azzouni writes in response to Mr. Omar Abbas' letter to the editor, “Stamp out check fund.” Jordan Times, dated Aug. 10.
Finally one dream of thousands of Jordanians is coming true, the Central Bank of Jordan (CBJ) has actually formed a new unit, whose sole purpose is to monitor the number of returned checks in the market and to eliminate the adverse effect these checks have on the economy and people.
This phenomenon will soon disappear.
Article # 18 of the new regulation states:
“Any customers whose checks are returned for lack of or insufficient funds, shall have their names disclosed to and entered on the CBJ's list of `Customers with Returned Checks.'”
Starting July 2 all customers will have a maximum of 15 days to rectify the status of any check(s) returned due to lack of or insufficient funds. Failing that, the drawer's bank will be obliged to inform the CBJ, and the customer will be duly listed in accordance with the above article.
The drawer's bank will not inform CBJ in the following circumstances:
a. If the returned check is subsequently cashed from the customer's account within 15 days.
b. If the bank receives a written settlement from the drawer and beneficiary issued before a competent judicial authority or notary public within 15 days.
c. If the bank receives a consensual written settlement from the drawer and beneficiary and the authenticity of such settlement has been verified within 15 days.
d. If the bank receives a letter from a judicial authority requesting the freeze of the procedures concerning the returned check until the dispute involving it has been decided upon within 15 days.
If the customer's name is reported, it shall remain on the list until their name is withdrawn according to Article # 17 of the regulations of the CBJ, which states the following:
The Unit of Returned Checks shall withdraw the client's name from the list of “Customers with Returned Checks” according to the following rules once the bank informs the unit that the customer has paid all his/her financial obligations, which resulted due to the returned checks, as follows:
1. If one check was returned, the customer's name will be removed 3 months from the date of settling the amount of the returned check.
2. If two checks were returned, the customer's name will be removed 9 months from the date of settling the amount of the last returned check.
3. If three or more checks were returned, the customer's name will be removed 24 months from the date of settling the amount of the last check.
While the customer's name is on the CBJ “Customer's with Returned Checks” list, the customer will not be issued any checkbook by any bank in Jordan and may have any existing facilities cancelled at the sole discretion of the bank.
As you can see the law is very strict, and hopefully CBJ will be firm with those banks that do not abide by the new rules. ― (Jordan Times)
Firas Azzouni, Internal Audit Executive - HSBC Bank
© 2000 Mena Report (www.menareport.com)