Payday Loans

• Payday loan lenders charge high rates of interest for loans that must be paid back shortly after they are taken out. If a borrower fails to pay back the money, the lender will exert pressure on him to pay. While this can be done through civil means, some lenders may also threaten the borrower with a criminal case. Yet, according the Consumer's Union, few prosecutors are willing to charge payday borrowers for passing bad checks.
  
  

"Hot" Checks

• There are a number of so-called "hot check" laws on the books in various states, including Virginia. These laws are designed to impose criminal penalties on people who pay for purchases with checks that they know to be phony or to be linked to an account with no money in them. In Virginia, if the check is for $200 or more, the crime is a felony.
  
  

Virginia Laws

• However, a person cannot be charged for a hot check in Virginia if his check to a payday loan lender bounces. According to the Consumer's Union, this is because the prosecutor cannot prove that the person maliciously fooled the lender. The borrower may genuinely have believed that there would be sufficient funds in his account on the day the check was cashed by the lender.
  
  

Considerations

• The only circumstance in which a check passed to a payday loan company in Virginia could be prosecuted as a hot check is if the person committed a fraud in passing it. For example, if the person who passed the check used someone else's check or if the check was forged, then the person would be liable for fraud charges -- but not for having the check bounce.