Client returned checks (fee)

[ILLMAS]

Just wonder, what do you charge your clients if a check is returned? $15, $25 $50?

[Bart]

I charge them whatever the bank charged me

[Elrod]

I charge the same as the bank, and I tell them to bring cash.

My bank charges $15

Some people just shoundn't have a checking account.

[MAMalody]

My policy was an invoice to the client (after a telephone call) of 1/4 hour and the bank charge. If they was a good reason, I would take off the 1/4 hour.

[Jack from Ohio]

First time I charge what the bank charges me plus $5. Second time, plus $15. There is no third time. Cash only after that. Fee increase of $20 built in after the second one.

Mistakes do happen. Two times is not a mistake.

[jainen]

>>I charge what the bank charges me plus<<

I guess this won't be a popular answer, but I strongly disagree. I've been lucky, and it's only happened a time or two. I just shrug it off as an ordinary cost of doing business. It's peanuts, and not worth hassling your clients over.

Unless you put it in the engagement letter or post it at the front desk, you have no legal basis for such charges they never agreed to. No moral basis either, in my opinion. When you accept their check it is simply an order to pay from a particular account. If you want to involve a different account or bank, that's for your own convenience. Pay your own bank fees.

[Jack from Ohio]

Pay your own bank fees.

I do pay my bank fees and far too many for the privilege of them using my money while in transit.

In my county, writing a bad check over $300 is a 4th class felony, prosecutable by the County DA. When I worked for a major tire company retail store, we used this many times to "motivate" people to make good on the bad paper they wrote.

Under $300 is a misdemeanor but still prosecutable by the D.A.

I do not pay bank fees for someone commiting a crime.

[JohnH]

My thinking follows along the line of jainen. It's been a long time since I had a client's check returned, but when it happened in the past I gave them the benefit of the doubt. As long as it was made good, I didn't bother hassling the client with more costs.

The bank charge I paid was just a cost of doing business for me. The client was already embarrassed by the returned check, so I felt it honored their dignity not to treat then like a little child who needed disciplining - that isn't my job.

[michaelmars]

I email then the what i get from the bank showing the bounce along with the associated charge. I then leave it up to them to see their character. Just a game of mine but i unually only get a bounce every 2-3 years so i can afford to be like this. If it were more fequent then i would charge the same fees a credit card would charge me $35. As Jainen says you need this in your agreement. Mine has it as does my invoices which also state a late fee of $25 after Net30 and interest @18% per annum. Its amazing how that is a motivator and whenever i send a late fee and interest notice i immediately get a check for the original amount dated 5-6 days before the Net30 date, That plus supplying return envelopes [no postage] lowered my average receivable to 15 days.

[mcb39]

I have only ever had it happen once and it was a relative. I paid the fee, but fired the client. Often, I will hold a check for a client who is honest enough to say that it will be good on (whatever day). They have never let me down, so far, and always call to let me know that I can take that check to the bank. Having them write a check and holding it is much better than accepting a "promise to pay" and never getting paid.

[joanmcq]

Last year a client's check bounced and she was so embarassed she tacked on an extra $25 to this year's bill. The check cleared before her deposit did.

I'll hold checks for a few clients; most are early filers, without much income, or a long term client that's come on hard times. When stateworkers were being furloughed, I had a few of these.