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RULE §209.2Charges for Dishonored Checks

(a) Purpose. Business and Commerce Code, §3.506, authorizes the holder of a dishonored check, seeking collection of the face value of the check, to charge the drawer or endorser of the check a reasonable processing fee, not to exceed $30. This section prescribes policies and procedures for the processing of dishonored checks made payable to the department and the collection of fees because of the dishonor of a check made payable to the department.

(b) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.

  (1) Department--The Texas Department of Motor Vehicles.

  (2) Dishonored check--A check, draft, order, electronic payment, or other payment device that is drawn or made upon a bank or other financial institution, and that is not honored upon presentment because the account upon which the instrument has been drawn or made does not exist or is closed, or does not have sufficient funds or credit for payment of the instrument in full.

(c) Processing of dishonored checks. Upon receipt of notice from a bank or other financial institution of refusal to honor a check made payable to the department, the department will process the returned check using the following procedures.

  (1) The department will send a written notice by certified mail, return receipt requested, to the drawer or endorser at the drawer or endorser's address as shown on:

    (A) the dishonored check;

    (B) the records of the bank or other financial institution; or

    (C) the records of the department.

  (2) The written notice will notify the drawer or endorser of the dishonored check and will request payment of the face amount of the check, any payment processor charges, and a $30 processing fee no later than 10 days after the date of receipt of the notice. The written notice will also contain the statement required by Penal Code, §32.41(c)(3).

  (3) The face amount of the check, any payment processor charges, and the processing fee must be paid to the department:

    (A) with a cashier's check or money order, made payable to the Texas Department of Motor Vehicles; or

    (B) with a valid credit card, approved by the department, and issued by a financial institution chartered by a state or the United States, or a nationally recognized credit organization.

  (4) Payments made by credit card must include the fee required by §209.23 of this chapter (relating to Methods of Payment).

  (5) If payment is not received within 10 days after the date of receipt of the notice, the obligation will be considered delinquent and will be processed in accordance with §209.1 of this title (relating to Collection of Debts).

(d) Supplemental collection procedures. In addition to the procedures described in §209.1, the department may notify appropriate credit bureaus or agencies if the drawer or endorser fails to pay the face amount of a dishonored check, any payment processor charges, and the processing fee, or may refer the matter for criminal prosecution.

(e) Any payment to the department from the drawer or endorser of a dishonored check will be applied first to the processing fee.

Source Note: The provisions of this §209.2 adopted to be effective February 4, 2010, 35 TexReg 660; amended to be effective March 12, 2014, 39 TexReg 1727; amended to be effective December 7, 2014, 39 TexReg 9367; amended to be effective June 28, 2017, 42 TexReg 3273

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