Who could imagine that the lobbying efforts of an entire State’s retail establishment could well make the growing retail check problem worse, rather than better? Well, certainly not the Minnesota Retail Merchants Association, but this could well turn out to be the case.
The Minnesota Retail Merchants Association (MRMA) is an aggressiveorganization that has worked hard within Minnesota to help curb the tide of "Bad Check" losses. In fact, MRMA has been instrumental in getting Minnesota Statute 48.512 passed which now requires banks as a matter of law to get the full Name and Birth Date of a consumer wishing to open a checking account, along with Address, Current Employment, Telephone number of Residence and Employment, Social Security number, Driver License number, and information concerning previous checking accounts, where and why closed, and their criminal record.
Now if you are thinking that this is a lot of information just to open an account, then you may be surprised that MRMA has been tracking the return checks from banks that adopted this new account strategy before it became law, versus those that waited. MRMA has found that after the initial shock, banks opened about 6% fewer accounts than had previously been the case, and that in at least one case losses by retailers were reduced over 10% as a direct result.
Representatives of the merchant community say they like the idea of bolstering the data available on checking accounts and potential bad checks at the point of sale. But they say banks also need to do more to thwart consumers who pass bad checks at the point of sale. "These are shared problems," says Judy Cook, president, Minnesota Retail Merchants Association. "Trying to identify these individuals at the outset and not letting them open checking accounts is where the banks should be focusing their attention."
Cook says the merchant community in Minnesota has been successful in forcing banks to more closely scrutinize individuals opening checking accounts. But the battle against check fraud is far from over, she concedes.
Decriminalization
Well, now MRMA has a new check problem, and it is called the potential decriminalization of bad check writing within Hennepin County, the largest county in Minnesota.
In a September 12, 1995 letter from Kevin S. Burke, Chief Judge of the Fourth Judicial District and Michael O. Freeman, Hennepin County Attorney, and Chairman of the Hennepin County Criminal Justice Coordinating Committee (CJCC), Mr.’s Burke and Freeman state, "One area that consumes judicial, prosecutorial, and probation resources that could be dealt with in other ways is NSF check cases in which merchants ask us to use the criminal process to get payment for checks written without sufficient funds. Currently, our courts handle about 500 to 600 NSF check cases per year. Though we recognize this is not a large number, these cases consume resources that could be used to prosecute other more violent, personal crimes. While it is certainly important to collect restitution in these cases, the caseloads for our probation officers are intolerably high, and it is difficult to justify the priority we place on these cases. The CJCC believes that these NSF cases are fundamentally civil issues between banks, merchants, and their customers. Therefore, we ask that you suggest to complainants the use of civil remedies, particularly conciliation court, in NSF check cases."
If you are selling in Minnesota, and have not seen a copy of this letter, we will be more than happy to provide one to you. This "New thinking" of course is good for Check Guarantee, and, by the way, is being discussed beyond the boundaries of Minnesota.
It is true, what the President of MRMA says, "No matter what you do, it seems the crooks always find another way to get you."
[Go Back]
