Paying for Their Checked Pasts

Checks don’t really bounce. They roll along and fall like balls on a pool table.

At bank processing centers, they shoot through check-reading machines, and if there’s not enough money in their accounts, they carom into a slot called the “pocket.” Then the bad-check specialists take over.

Those specialists say that nowadays the “pocket” is getting exactly what it doesn’t need: new blood.

Like the 24-year-old woman spending her Saturday in a community college classroom as the not-so-willing guest of the Orange County district attorney. “I never bounced a check before, I swear,” she said. “This is first time it’s happened.”

Which is exactly why she and hundreds like her were attending such classes all over California. The goal: Make them see that bouncing a check is morally wrong, before it becomes a habit.

“Lately with the economy, we’re getting more of the first-timers, a lot more, people who have run into problems,” said Bob Johnston, collection supervisor of Commercial Check Control in Los Angeles.

Last September, Southern California--notorious as a bad-check center even in good times--sent $33.8 million worth of checks into the “pocket” every banking day. That’s $4.4 million a day more than in the kinder, gentler September of 1988, when total check volume was the same.

Cashex-West Inc., reputedly the largest check-collecting agency in Southern California, now is receiving 80,000 bad checks a month, far above its usual 60,000. “I think one of the reasons is, it’s harder to collect on these checks now,” said Cashex general manager Larry Page. “We have more clients and they’re referring more checks to us. It’s taking a lot longer.’

If past years are any guide, things will get worse very soon. Bad-check volume will increase and peak this month, when holiday cheer is gone but the bills remain. Many bills will be paid with checks backed mainly by hope.

About a month or so later, many of the bad-check writers in Los Angeles, Orange, Riverside, Ventura, Santa Barbara and Kern counties will receive letters from collection agencies with more than the usual clout. For these agencies don’t threaten to turn you over to the local district attorney. These are the local D.A.

In 1986, the state Legislature authorized D.A.s to set up their own check collection programs, and so far programs are operating in 11 counties. The programs are aimed at rookie bad-check writers, the ones still capable of feeling guilty about it. Like traffic offenders, they are sent to school in hopes that will patch up their attitudes.

“I have a lot of compassion for these people,” said Don Mealing, owner of American Corrective Counseling Services, the firm hired to run the Orange County program. “Most of them, when they signed that check they had no intent to defraud. It’s kind of ‘there but for the grace of God . . .’

“We’ve had people attend who looked like street people, and we’ve had doctors and lawyers,” Mealing said. But after seeing about 3,200 people go through his classes since they began in September, 1990, he says a typical student has emerged. She’s a woman of modest means in her late-20s or 30s who has been writing the occasional bum check since she opened her first checking account.

The Los Angeles County program has been going since 1986, administered by the D.A.’s office itself. Larry Mulligan, head of the program, says he’s boiled his image of his typical student down to its essence: “It’s someone who can’t live without the Twinkies and Ding Dongs and always figures they can make it to Friday.”

Like Brad? He wrote a hefty check to buy a car stereo and wound up in one of Mealing’s Saturday classes in Santa Ana.

It wasn’t his fault, Brad explained to his 18 classmates. He’d moved out of San Diego, but all his mail was still going down there. So how could he know his checks were bad?

You don’t keep track of your checking balance? Mealing asked.

“I don’t have the time.”

Why didn’t you have your mail forwarded?

“I don’t know.”

Don passed a bad $14 check at a supermarket, then didn’t react to letters asking for payment. “It was just an oversight. It’s easy to oversight $14. I focus on the bigger things.”

Debbie reacted to her latest bad check by closing her checking account. She gets in trouble, she said, “because I can’t say ‘no’ to my kids.”

Colleen had promised to take care of her bad check, “but I just forgot about it. When no one’s helping you and you have all these responsibilities,” she said, leaving the rest of the sentence to inference.

“Most of the people in our program, they don’t fit the criminal personality, which is why we think this program will work,” Mealing said. “When they signed the check they had no intent to defraud. They just didn’t take care of it.

“About a third of the people are in some short-term financial crisis and write a bad check as a kind of loan. They intend to pay it back. Another third are just procrastinators. Another third are passing bad checks to meet living expenses.

“Underlying all this are their values toward money, relationships, being responsible. They’re very basic issues, but they don’t see the relationship to their check writing. So we try to remove their rationalizations. The bad check is just symptomatic of emotional and financial issues.”

Mealing said the program’s greatest value may be what the students dislike the most: being forced to attend classes when their “crimes” seem so trivial. One class member was there because a $6 check went bad.

“But if you’re doing something you know is wrong--like writing bad checks--you feel guilt. And if you can’t change that behavior, you eventually lower your values to match the behavior,” Mealing said. “That eases the feelings of guilt, all right, but it’s also the route to becoming a criminal.”

The programs were born, however, to meet the needs of the grocery industry, which in 1983 claimed to be taking $444 million a year in bad checks statewide.

The stores’ problem was that police departments, fearful of being deluged by bad-check complaints, set minimum amounts for checks they would investigate--typically $100, $200 or more. Most grocery-store checks didn’t qualify.

Legislation passed in 1986 allowed the local district attorney to create a new avenue to prosecution that didn’t involve the police at all. If bad-check writers didn’t pay up after a reasonable time, the store or individual could send the bad check and a complaint directly to the D.A.’s bad-check program, which would mail its own demand for restitution, this time backed by the threat of criminal prosecution.

Mealing said that about 80% of bad-check writers who receive the letters pay up right away. Many offer to come to the office that very day and pay in cash “if they just don’t have to go to that class.”

But the class is mandatory, Mealing said. The check writer must pay for the class ($50 in Orange County, $40 in L.A. County), pay a $25 fee for each bad check and make restitution. If after completing the class the check writer floats another bad check, “we go straight to prosecution,” Mealing said.

Details of the programs vary from county to county. In Orange County the bad check must be $500 or less and the class lasts eight hours. In Los Angeles County there is no maximum check amount and the class lasts four hours.

But all programs boast that they cost taxpayers and victims nothing. All program expenses are covered by the bad-check writers’ fees, they said. The Los Angeles program even makes a surplus, Mulligan said.

According to Orange County Dist. Atty. Michael R. Capizzi, his program handled about 45,000 bad checks and collected about $300,000 during the first year.

“I’ve had very positive comments from businesses in the community,” Capizzi said. “They think it’s one of the best things since sliced bread, and I think so, too. Everybody comes out ahead.”

Al the bartender disagreed. He said his personal checks bounced because his payroll checks bounced. This class, he said, “is a mockery of justice. Who protects the little guy? I’m real angry about being here. Seventeen years of good credit gone in four months!” The class was a waste of time for him, he said. “I know all this stuff already.”

Mercedes, a gray-haired and jittery woman, said the class did her no good either, because her problems taught her to “never write another check.”

Perhaps she could handle an account after she learned how to manage one in class, Mealing suggested.

“No,” she said, “I’d rather die.”

But young and quiet Linda said she felt better after taking the class.

At the start, she had told about writing her bad check because her husband was a day late making a deposit. “We’ve gotten it worked out,” she told the class. “For the most part, we pay cash for things. We have a checking account if we need it.”

“Is that arrangement OK by you?” Mealing asked.

“Well, we have other financial problems, and my dad . . .” but she broke down sobbing and left the classroom.

After the class, she said she had learned a few things. “If you write a bad check, it’s you who did it,” she said.

“I think I could handle things better now. But I still think I’ll leave the checkbook alone until we get back on our feet.”

They Did It on Account of . . .

These are the most common excuses people give for having written bad checks:

1. “I thought I’d have enough money in my account by the time the check cleared.”

2. “I subtracted wrong.”

3. “The bank made an error.”

4. “My husband (or wife) wrote a check on my account without my knowing it.”

5. “I’m no good at budgeting.”

6. “I didn’t balance my checkbook.”

7. “I was going to pay it back as soon as I got the money.”

8. “My checkbook was stolen.”

9. “It’s a forged check; someone stole my driver’s license.”

10. “I thought my husband was making a deposit, and he didn’t.”

11. “Somebody bounced a check to me.”

12. “My ex-wife stole my checkbook and wrote the checks to get me in trouble.”

Source: Law enforcement and check-processing agencies