Bouncing a cheque in the UAE
You may have heard the stories but have you ever wondered exactly what it is like to be facing prison due to a bouncing a cheque in the UAE?. Here is an interview with an ex-jail bird that defaulted on his rent cheque for 7,500 USD, what is interesting about this case is that the company that processed the cheque and sent him to jail owed him over $80,000! It just goes to show how screwed up this archaic law is in the UAE. Either way a fascinating look at understanding the process for bounced cheques in the UAE, and a must read for anyone moving to the UAE.
Bouncing a cheque in the UAE is the process of inadvertently writing a bad cheque that can not be honored; usually by people who are unaware that their bank balances are too low. Bouncing a cheque in UAE is a crime of misdemeanour, implying that the punishment may be imprisonment for a specified duration or a fine of money not exceeding 30,000 Dirhams, or both – obviously if you are in the habit of bouncing cheuqes you are probably not going to be able to pay the cash fine.
If you can not afford to pay the cheuque you are going to prison. One bounced cheque counts as one crime in the UAE so if you have multiple bounced cheques you are punishable to the full extent of the law for each instance of a cheque being bounced.
It works like this, for the first cheque you bounce they will take your passport as a security and will give you 30 to 90 days to rectify the situation with the complainant (this is the person who you bounced a cheque on). If you bounce a second cheque they will require another passport in deposit – obviously this could not be yours. It will have to belong to someone else. For the third cheque another passport etc etc.
As soon as you run out of friends passports to put down for your debt (by the way if you ever did this you would be a bit of a scum bag, because lets face it who would put their friends in prison for your bad debt) you would be shipped off to the Dubai holding prison.
The holding prison is full of around 200 – 300 inmates, some of which are incarcerated for farting in lifts ( I kid you not see my future advice article about farting in lifts) some of whom will be in jail for serious assault, some for murder, some for kidnap, some for larceny. But don’t worry you will get the opportunity to share a jail cell with all of them.
Why cheques bounce
Common reasons cheques bounce in the UAE are numerous, from bad real estate deals, to signing up a bad office rental (as in my case) to actually being a criminal and defrauding people. If you only had one cheque that has bounced and you can not rectify it with the complainant within your allotted time frame you will be given a court date.
At court you will be given an opportunity to present your case, at that time the judge will ask you if you had signed the cheque. When you say “Yes” they will ask if you have the money now to give to the complainant, at which time you can pay the judge the full amount or whatever you have, this shows you are willing to pay something even if you take five Dirhams out of your pocket. Unless you can pay the whole amount the judge will now sentence you to your prison term.
As terrifying as this is, the circumstances of your cheque bouncing have very little if any impact on what is considered a crime. The legal take is “You wrote a promissory note without having the money to cover it, therefore you have committed a crime. Any other point that you may wish to make at sentencing although it will be listened to will have very little impact on your sentence. Jail sentences for debt in the UAE are defined by the judiciary and the royal court, it is set per month per X in Dirhams. When i was in Dubai it worked out at 1 month incarceration paid off 10,000 AED of debt. Surely a valuation that needs to be revised.
If you are about to bounce a cheque
So if you are about to bounce a cheque for whatever reason in Dubai, here is my honest advice based on what I had to go through. This is not legal advice, if you are ever in this situation you should consult with your lawyer to see what he or she says. However all the same this is what i wish i had known.
Get out of the UAE whilst you can
There is no logical reason for you to stay in Dubai facing incarceration, passport seizure and court if you do not have to. Drop every bit of EGO you have in right now, Dubai is not the same as the West, get on a plane, you are not that important or too smart to listen to advice. Getting out of of the UAE is a very, very, very good idea.
If you think a cheque is about to bounce then you get yourself on the first plane you can – no arguments. It is going to be easier for you to sort out all of your issues on a telephone that it is locked up in jail. If you do end up in jail one nugget of advice you will recieve is “you need someone to be working on the outside for you” – If you can make sure this is YOU by avoiding the clink then all the better. Get on a plane and then get on the phone to everyone in Dubai to sort your mess out. If you can do this you are in a strong position to resolve your issues.
If you can not get on a plane then you should be labelled as pretty retarded, you either suspected a cheque was going to bounce and did nothing or you thought you would work through it in the UAE. What you didn’t realize is however that whilst you are in the UAE 100% of the negotiating power is in the hands of the person that has your bounced cheque, they can put you in prison, so if they want thier money where does that leave you? Better to call them when they dont have this hold on you, negotiate your issues and then come back. If you do this, never say that you have left Dubai, simply say that you are on business trip and can not come back until this issue is resolved.
Now unless the person that you bounced a cheque on helps you resolve the issue you can never come back, this means they will never get their money! The ball is in your court if you can get out of the country. If you are still in two minds like I was then read on and i will share my prison stories with you to see if you change your mind.
Dubai prisons are full of people that have “Done the right thing” and stayed to face the penalty for bouncing a cheque – This is not a good idea at all for you or your family. Get on a plane. If you believe you are genuinely not a criminal but a victim of financial circumstance and market forces they wont send you back. The most hournerable thing you can do is to your family and loved ones, not your creditors.
If you did not get out – Start to panic
Ok, so if you are not on a plane and you have one passport, but you have an expected number of cheques defaulting in the next 30 days. Fist beg or borrow the money and pay as much as you can to get the charges dropped and then get out of the country and refer to step one.
If its not possible and you are stuck with a travel ban explain to the person you wrote the cheuqes to that you can not pay them ever if you are in prison and ask them to help you work out a way to pay them back whilst you can still make money outside. All of your communication at this point should be telephone based.
If you can not rectify the situation then you are off to either court or jail. The reality is that unless you can get the money together to cover the cheques you have written before the court appearance date then you will be off to jail.
Do not get arrested
So this is how it will happen, before you get to the court stage and when a cheque criminal case has been made against you, you will get a telephone call explaining that you are wanted at the Police station. They will probably be calling you on your mobile asking you to come for an interview. This is because when you buy a mobile sim card in the UAE they take your passport number, so they know your number and your location. If you take this call and visit the police station you will need to give your passport as security, if you are already under a travel ban and without passport you will be straight off to jail.
The first step in avoiding arrest is to throw away your phone, without your phone they can not call you, nor can they use the phones location based services to find out where you are. The phone must go, borrow a phone from a friend or visit a shop in Deria and ask for a phone SIM card with no passport, you will pay more for the SIM card, however you will still need to buy it as you are going to need a phone to try and sort out your situation.
Leave your place of residence and go and stay with a friend, or in the worst case scenario go and stay in your car (if you have one). Do not return to where you live, do not hang out in all your favorite spots, bars etc. Do not be seen out in general. If the person that you have bounced the cheque with sees you they will call the UAE police and you will be on the way to jail.
Always speak to your creditor on the telephone but ensure you have your SSID switched off so they can not trace your number. Call the creditors office to arrange a structured payment for your debt. I would not suggest you ever go to meet your creditor, they could quite easily have the police there waiting for you.
If you can do everything through a third party. This is going to have to be a friend or your lawyer, preferably a lawyer. You are going to need a lawyer anyway, so if you can afford to retain one consider doing so to help you negotiate your payments. The problem is that as an expat you will need to pay for your lawyer, if this is the case and you are also broke then this wont be an option.
It is going to be much easier for you to solve your problems from outside jail compared to being inside jail, even if you are on the run. When it comes to your sentencing the fact that you went “Missing” will be considered, your defense is of course you didn’t have any money for a phone, you had to move out of your house, you stayed on friends sofa’s etc whilst you tried to pay back the debt.
If you are outside of jail you have access to a telephone, friends and a computer, you also have the ability to earn money, these are all luxuries you do not have in jail so staying on the run is preferable to time inside prison.
After being on the run for a while you will feel a bit lost, at this point you have the option to turn yourself in or make a run for it over the border to Oman, or to “stay at large” as long as possible whilst you work make enough money to pay the debt.
The escape to Oman option is not recommended – you will almost certainly die in the desert, or cripple yourself whilst hiking up mountain passes, but even if you make it you will almost certainly be sent back.
The fact is the the main GCC countries share data – so if you are picked up in Oman and they can not find your point of entry into Oman on your name or passport number then they will call the UAE and send you straight back – bummer. Same, same with Qatar and Saudi.
Unless you have friends in very high places you will not be able to consider getting a boat to pick you up offshore like in Escape From Dubai, then at this point it is better to resolve yourself to the fact that you are going to be spending time in Prison.
Coming to terms with the situation
Coming to terms that it is now either a choice between earning and paying back the money or jail will probably come as a relief. Work to make as much as you can during this time, there are a lot of contracting jobs available online, and using ODESK or ELANCERS for 14 hours a day straight means that you do not have to turn up at your place of employment.
You can not earn money in jail, so use every moment you have outside jail to try and earn the money to fix your situation. However at some point, it could be a week or it could be as long as a year they will catch you. This is why at all times you keep some money in your pocket and you should always carry a number of Etisalat phone cards, you will need them. You will also need to agree with a friend that is not in jail, that they will help you and bring you more phone cards and money as you need it before you get caught.
The go to jail card
On the basis that by at this point you have not been able to escape the country in your friends super yacht or have not been able to work to pay the money back then you will eventually get caught and will be off to jail. Hell you may have even have been caught when they called you to the police station – in which case the next bit of advice is going to be awesome. Take a deep breath and slowly read the next heading, time and time again.
Jail is funny shit
The first thing to realize and to do is to simply accept you are going to be spending time firstly in a holding jail whilst you wait for your court date and then depending on your sentence in one of the UAE prisons. When you get to jail they will strip you of your belongings and check you in. There is no priority line, you will be checked in and then walked into the large holding area.
Now jail is pretty horrific and terrifying especially if you have never been before, when the policeman locks the door behind you will stand in the jail main hall with all of the convicts whilst you work out what you should be doing. At this point someone should come and pick you up.
You will get “Hey whats your name? What are you in for? (Never bullshit here) and “What do you come from” – at this point the person that has befriended you for whatever reason will show you to a free cell. If you are a western Ex Pat it will normally be a western expat that gets you, if you are Indian it will be an NRI that picks you up – and so on. Make sure you get a cell with as many of your fellow countrymen as possible. Hopefully with people like you that have bounced cheques and not tried to kill anyone.
Keep your head down, answer any questions with short answers, do not shoot your mouth off and don’t stare at anyone in the eyeballs. Do whatever anyone tells you at this point, within reason of course.
Your whole jail experience is going to depend on how well you can build friendships with the people inside the jail cell, make sure you quickly make friends without being a talkative idiot. Go to the shower at the same time everyone else goes to the shower, do not lurk around until the end as this wont make it safer for you, in fact it will make it more dangerous.
Never ever hit anyone, if you hit anyone in jail then you may get an extra charge to be considered when you are sentenced. There are security cameras all around your cell and holding area, if someone decides to hit you first for any reason then you need to ensure that you send a message that this is not OK.
The moment that someone makes a physical assault on your person then the first thing you do is to make as much noise as possible, the second thing is to ensure that at the moment they go to hit you, then you go mental on their ass. You are going to have to switch off all of your emotional switches at this point, if this guy is coming to hurt you the best way to ensure that no one will mess with you again is to ensure he does not do well out of the situation and ends up hurt. If you are completely unable to deal with violence then run away if you can, but the likelihood is that you will face the same terrifying situation again until you stand your ground.
There is no specific holding jail for people that have bounced cheques, you will be in jail with real criminals and real criminals are generally not that nice. If you can do enough to stop them hitting you and then step away from the situation, do not tell the guards that you have been attacked, just go back and tell your cellmates.
Fighting back will help people understand you are not a pushover, if you do well and just keep your head down then you shouldn’t get messed with again.
Facilities in UAE Jails
There are four things to be concerned about. Firstly can you get enough sleep, the holding cell that i was locked up in had four bunks in it and eight cellmates causing sleep to be defined in shifts of 4 – 6 hours. There is also the mess hall, this will normally be basic food of chicken and rice twice a day, the food is not great but it is edible. If you have money in your pocket you will strangely enough be allowed to order food in from any number of fast food places to be delivered to the jail.
There will be a mess area with a small television showing normally Indian films, use the mess area to sit in and relax, talk to the people there that want to talk to you. Always be respectful and friendly, follow the rules and do as everyone else does.
Do not bother calling the Embassy, they wont be able to do anything for you. Speak to your family back at home, and ask them if they can help you, call everyone you know because the only way you are going to be avoid staying in jail is to get the money together that you owe for your bounced cheques.
Telephone calls will be your lifeblood in jail, getting to speak to as many people as possible that can help you with your situation is going to be critical to you getting out. You will need phone cards, normally the phone is free from around 5-6 pm for a couple of hours.
Preparing for court
The thing about spending time in jail, as you are about to find out, is that it is not at all as bad as you had imagined it. Firstly you will be speaking with a lot of people, you will be getting a lot of time to think and a lot of time to consider your next move. The other thing about jail is that a lot of people have very funny stories, the people that are also there for bouncing queues will be keen to discuss your stategy and provide advice, and of course to learn from you and potentially apply it to their case.
You will now be waiting for your court date, in between then you will meet a number of times with the magistrates representative or one of the judges to discuss your case. Now in all fairness the guy that will be interviewing you will be almost as pissed off with the fact you are in front of him for bouncing a cheque as you are. They want to deal with villians, not people that are commiting crime for instruments of money.
Many of the guards, lawyers and judges are very religious and Islam has some pretty strong views on money, most of them will share the fact with you that they do not think you should be there. However this still is not going to help, you are going to need to get the money.
Now recently the UAE has relaxed the cheque laws to ensure that anyone that writes cheuqes as a security for loans will not going to prison. But if your cheuqe is to a person, a supplier, a real estate company etc etc then you are still going to prison unless you can prove that you did not sign the cheque.
The court date
On your court date you will be given the opportunity to explain your situation, you will be able to explain why you have not been able to pay the cheques value. Your personal circumstances count for very little, the judge will ask you if you can repay the debt, and if not he will hold you over for sentencing. All the time that you are currently spending in the holding jail is effectively going to be credited to your sentence, so if you are in jail for three months and then receive a 12 month prison sentance then you will only have to serve out 9 months in the clink.
Of course you can just ask for the sentence straight away as well, this will make it clear to the judge that you can not repay your debts and will shorten your hanging around in jail going to different court dates, being held over for sentencing and putting off the inevitable. When you are sentenced you will be serving that time out in prison, you will be taken from the holding jail to the prison complex. If the creditor drops the charges or you repay your debt whilst in prison you can then ask for another court date and get out.
There are a number of ways in which your sentence will differ, firstly if your debt is not huge and you have good Emirati friends on the outside they may be able to lobby to get you included in the Ramadan pardon in which case you will be walking out at the next Ramadan holiday.
The other thing you can do is to have a powerful Emirati friend that will vouch for you, explain why your case is unfair, and plead leniency to the judge. This may also result in you getting a lesser sentence, but do not expect it to. Another factor in the length of sentence is the judge you get, some judges are from Jordan, some from Egypt and some from the UAE. Hope you get a judge from Jordan where prison sentences are lighter for bounced cheques, the best result you can get is to get an Emirati judge sentencing you. Emirati judges tend to give much lighter sentences for crimes based on money in general. Maybe it is because they just feel like they can, or because of their Islamic views either-way you luck out if you get a good judge. If you have an Emirati friend on the outside ask him or her to lobby the prosecution service to ensure you get the best judge.
The judge will now pass your sentence, you will be spending that long in prison, whilst you are inside you will need someone on the outside to be working for you. Either to raise the money to get you out or to help you appeal your case successfully.
Are all Bounced cheques punishable under the law?
You can only be penalized for issuing a bouncing cheque in UAE if you drew the cheque in bad faith. This means that at the instance of drawing the cheque, you-the person writing the cheque-knew that you are not able to honor it and / or are reckless to this effect.
The implication here is that you knew, at the instance of writing the cheque, you indeed do not have enough funds, or you should have known that you will not have the ability to honor the cheque. However, in practice, the court does not put into consideration situations under which the cheque in question was signed. It is very cut and dry.
Ways to avoid bouncing a cheque
Balance your accounts so that you know all the time how much money you have. If you realise that you do not have enough money, avoid writing a cheque. Ensure that you are able to account for all automatic deductions together with online bill expenses.
Will they really send me to prison?
While bouncing a cheque in UAE may appear simple errors, banks and retailers are taking it seriously. They will institute legal proceedings or charge you hefty fees, so it is better to avoid bouncing cheques at all costs. Consider creating a backstop account that will automatically be debited if your primary account balance is too low to pay a cheque.
If you can get your cheuqes written and signed outside of the country, if you did not sign the cheque then you have a much better case. Either way if you bounce a cheque and can not afford to pay it then yes you are going to prison.
Start doing the legal reading now
Start getting acquainted with every aspect of the law right now, there are two excellent resources following that will help you understand the points of law in detail.
- Criminal Aspects of bounced cheuques under UAE law.
- Dishonoured Cheques in the UAE – A Criminal Law perspective
- Bounced cheuqes should be decriminalized.
If you end up in prison
If you are in prison the only thing you can do is to try and get the very best out of the time you are there. Try to take a positive approach to why you are there, and that prison is going to be a valuable life lesson. This positive attitude will help you out a lot.
Spend as much time reading, learning new skills and try to learn Arabic whilst in prison as it will make things easier for you. How long you will be there will depend on the extent of your debt.
It is unfortunate that the UAE still has these draconian laws. There are many that are working to scrap the bounced cheque law both within the banking system and within the judiciary.
Bounced cheques and expatiates spending time in jail for debt it is starting to be identified as an area that the UAE suffers greatly from in both in terms of bad press and reduced investment into the country. It also acts as a major deterrent to people setting up their own small businesses.
Trust that your situation and the law will be changed at some point. Learn as much from your new friends in prison that are in the same situation, everyone in prison will be constantly working to get out. Also at the times when you are feeling completely dejected remember this:
Woe to every slanderer and backbiter. Who has gathered wealth and counted it. He presumes that his money will make him immortal.”