Red Notices for bounced checks - INTERPOL as the UAE's collection agency


For a while, it seemed that the United Arab Emirates (UAE) might stop using INTERPOL's Red Notice system as a private business dispute resolution agency for its financial institutions.  In the UAE, it is common practice for financial institutions to insist that mortgage recipients supply them with a "security check," or a check for the full amount of the mortgage.  If a debtor falls ill, loses his job, or fails to make a mortgage payment for any other reason, the check is deposited, promptly bounces, and forms the basis for a fraudulent check charge.  The fact that a fraudulent check charge requires fraudulent intent at the time the check was issued is routinely dismissed.

For foreign nationals who left the UAE after losing their jobs or legal status in the UAE and bouncing a security check, the financial institutions turned to INTERPOL.  They sought and received Red Notices against the debtor, regardless of whether the debtor wanted to default on the mortgage or not.

A public outcry and the efforts of several organizations, including Detained in Dubai which is  ably led by Radha Sterling, seemed to have led to the cessation of the UAE's seeking Red Notices for bounced checks. The UAE's page on INTERPOL's website showed a drastic decrease in financial/banking/fraud charges and a higher percentage of what would be considered "ordinary crimes," such as crimes of violence.

Also, the banking law with respect to bounced checks was changed- but not for foreign nationals.  After an initial report to the contrary, officials from the UAE clarified that the decriminalization of bounced checks would only apply to UAE nationals.

In the next post:  is the UAE still misusing INTERPOL's Red Notice system for civil collection purposes?

As always, thoughts and comments are welcomed.


Written by:

Published In:

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Estlund Law, P.A. | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »

All the intelligence you need, in one easy email:

Great! Your first step to building an email digest of JD Supra authors and topics. Log in with LinkedIn so we can start sending your digest...

Sign up for your custom alerts now, using LinkedIn ›

* With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name.