Sunday 21 July 2019 (UAE)

Checks and Cheques in Dubai

Cheques in Dubai, Abu Dhabi, UAE

Checks or cheques are commonly used in Dubai, Abu Dhabi, and UAE for bill payments but less frequently for day to day shopping. Bouncing a cheque in the UAE is known as check fraud and is a criminal offence that can (and often does) result in arrest and a jail sentence as punishment.

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UAE Federal Cheque Fraud Law

Article number 401 covers cheque fraud law in the UAE. The text of the article after amendment according to Federal Law No. (34) 2005 published on December 2005 by Federal Gazette (additions to original article in italics) is:

Article No. (401) of the Penal Code under Federal Law No. (3) 1987

Shall be punishable by confinement or fine any individual who, in bad faith draws a cheque which does not have a provision which could be withdrawn or which has a provision less than the amount of the cheque or who, in bad faith, after issuing a cheque, withdraws all or part of the provision and renders the balance insufficient to settle the amount of the cheque or, in bad faith, orders the drawee not to pay the value of the cheque or, in bad faith, draws or signs a cheque in such a manner as to prevent it from being paid.

Shall also be liable to the same punishment any person who shows or delivers to another a cheque payable to bearer, with full knowledge that it does not have a provision which could be withdrawn or which has a provision less than the amount of the cheque.

The criminal case shall terminate if payment was made or assignment was established after commitment of the offence and before a final judgment was passed in respect thereof, and if such occurred after the judgment became final, it would stop execution.

If the cheque book was withdrawn by order of the court and the claimant was prohibited to optain new cheque books pursuant to article (643) of the Commercial Transaction Law. The public prosecution shall advise the Central Bank of the matter in order to circulate to all Banks.

In case any bank contravened the said order, it has be required to pay (AED 100,000).

A couple of points to note:

Civil Court for bounced security cheques
Bounced cheques in Dubai data and statistics
Last update Saturday 22-Mar-2014. Page development 4L 5C.
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www.dubaifaqs.com/cheques-in-dubai.php (PDF and print version).

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