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Question: Can I be charged with check fraud? A collection agency keeps harassing me on a payday loan debt. They keep changing the payoff amount and they won’t send me paper work in writing for my records so I quit paying them until I get proof that they are who they say they are. Now they say that they are taking me to court and charging me with check fraud. Can they do this?

Answer: No. If this is a payday or other loan in connection with which you gave a postdated check, the bad check statutes do not apply (the lender knew the check was not good when issued). Furthermore, the threat is a violation of the Fair Debt Collection Practices Act.

If this was an Internet loan, check if the lender was licensed by the Illinois Department of Financial and Professional Regulation. The lender needs either a Consumer Installment Loan Act license, a payday loan license, or a bank or credit union charter. If not, the loan is not enforceable and you can get whatever you paid back.

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