SUBJECT: The Rule on ‘Bouncing Checks’ (BP 22)

I. Introduction

This memorandum provides an exhaustive analysis of Batasan Pambansa Bilang 22 (BP 22), also known as the “Bouncing Checks Law.” Enacted in 1979, this special penal law criminalizes the act of issuing a check that is subsequently dishonored by the drawee bank for the reason of “Account Closed” or “Insufficient Funds.” Its primary purpose is to eradicate the pernicious practice of issuing worthless checks, which undermines commercial and financial transactions, erodes public confidence in the banking system, and constitutes a form of estafa or fraud. This memo will detail the elements of the offense, the procedural rules for prosecution, available defenses, and pertinent jurisprudence.

II. Elements of the Offense

The crime under BP 22 is malum prohibitum. Its prosecution requires the concurrence of the following elements:

The making, drawing, or issuance of any check on account or for value.

The knowledge of the maker, drawer, or issuer that at the time of issue he does not have sufficient funds in or credit with the drawee bank for the payment of the check in full upon its presentment.

The subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit, or its dishonor for the same reason had the drawer, issuer, or maker failed to keep sufficient funds or credit to cover the full amount of the check within ninety (90) days from the date appearing on the check.

III. The Act of Issuance

The law penalizes the act of issuance itself. The check must be drawn against a bank account. The cause or consideration for issuing the check is immaterial to the prosecution for violation of BP 22, as it is distinct from the crime of estafa. The check becomes the harmful instrument, and the law prescribes the act of putting it into circulation without the requisite backing of funds.

IV. The Requirement of Knowledge

Knowledge of insufficiency of funds is a crucial element. However, BP 22 creates a presumption of knowledge of such insufficiency. This conclusive presumption arises from the very act of issuing the check. The law provides that the making, drawing, and issuance of a check, payment of which is subsequently refused by the drawee bank due to insufficiency of funds, shall be prima facie evidence of knowledge of such insufficiency. This legal presumption simplifies prosecution but is subject to the right of the accused to present evidence to rebut it.

V. The Dishonor and Notice of Dishonor

For the offense to be complete, the check must be presented to the drawee bank within ninety (90) days from its date and be dishonored. The dishonor is a necessary consequence. Furthermore, a critical procedural requirement is the giving of a notice of dishonor to the drawer or maker. The holder of the check must, within thirty (30) days from receipt of the notice of dishonor from the bank, give written notice of the dishonor to the drawer. The drawer then has five (5) banking days from receipt of such notice to make payment or otherwise arrange for the full payment of the check. Failure to pay within this period creates a cause of action for prosecution. The notice of dishonor is a condition sine qua non for filing the case; without proof of this notice, the accused cannot be convicted.

VI. Penalties

Violation of BP 22 is punishable by imprisonment of not less than thirty (30) days but not more than one (1) year, or by a fine of not less than but not more than double the amount of the check, which fine shall in no case exceed Two Hundred Thousand Pesos (P200,000.00), or by both such fine and imprisonment at the discretion of the court. The Supreme Court, in administrative matters, has also emphasized that the penalty of imprisonment contributes to prison congestion and has encouraged the imposition of fines, especially in cases where the accused shows a willingness to settle the obligation.

VII. Comparative Analysis: BP 22 vs. Estafa under Art. 315(2)(d) RPC

While both involve dishonored checks, they are distinct offenses with different elements and purposes.

Aspect	Batasan Pambansa Bilang 22	Estafa under Article 315(2)(d) of the Revised Penal Code
Nature of Law	Special penal law; malum prohibitum.	A crime under the Revised Penal Code; malum in se.
Protected Interest	Primarily public interest in the integrity of commercial documents and the banking system.	Private interest; the property or damage sustained by the offended party.
Key Element	Issuance of a worthless check, regardless of the transaction’s nature.	Deceit (dolo) and damage caused by the issuance of a check in payment of an obligation, with fraud or abuse of confidence.
Requirement of Notice	Notice of dishonor to the drawer is an absolute prerequisite for criminal liability.	No requirement of a notice of dishonor; fraud is the central consideration.
Presumption	Presumption of knowledge of insufficiency of funds arises from the act of issuance.	No similar presumption; the prosecution must prove fraudulent intent (dolo) from the start.
Effect of Payment	Payment of the check after the offense is complete does not extinguish criminal liability, but may mitigate penalty.	Payment of the obligation may negate the element of damage, potentially affecting liability.

VIII. Defenses

Available defenses in a BP 22 case include:

Lack of Notice of Dishonor: Failure of the complainant to prove that the required written notice of dishonor was sent to and received by the drawer is a complete defense.

Full Payment Within Five Banking Days: Proof that the drawer made full payment of the amount of the check or arranged for its payment within five (5) banking days from receipt of the notice of dishonor.

Mistake or Lack of Knowledge: Rebutting the presumption of knowledge by proving that the insufficiency of funds was due to a cause beyond the drawer’s control (e.g., a bank error, a hold on the account unknown to the drawer, or that the drawer had sufficient funds at the time of issuance which were later improperly levied).

The Check was Issued as a Guarantee or Security: If the check was issued merely as a guarantee or security for an obligation and not for encashment, some jurisprudence suggests this may negate the element of issuance “for value,” though this is not an absolute defense and is highly fact-dependent.

Absence of Consideration or Value: Arguing that the check was issued without any valuable consideration, making it a mere accommodation or simulation.

IX. Procedural Rules and Jurisprudence

Venue is critical. The criminal action shall be filed in the court of the place where the check was issued or the place where it was dishonored, at the election of the offended party. The Supreme Court has consistently held that the notice of dishonor must be proven as a fact. The prosecution must present evidence that such notice was sent and that it was received by the accused. A mere affidavit of mailing is insufficient without proof of receipt. Furthermore, the filing fees for BP 22 cases are considered indemnity and are subject to the rules on legal fees.

X. Conclusion

Batasan Pambansa Bilang 22 is a potent tool to maintain the reliability and acceptability of checks in commercial transactions. Its enforcement hinges on strict compliance with its elements, particularly the procedural requirement of the notice of dishonor. While it operates with a presumption of knowledge, it allows the accused to present evidence to rebut it. Practitioners must carefully distinguish it from estafa, as the elements, defenses, and strategic considerations for each differ significantly. The prevailing judicial trend leans towards imposing fines over imprisonment to achieve the law’s corrective purpose without exacerbating prison congestion, provided there is no showing of blatant fraud or repeated disregard for the law.