Questions & Answers
Destiny of the customer's cheques issued before the closure of a company
I wrote out post-dated cheques to a removal company.
This company has now been closed by the DED, and their license expired in July 2017. This has not been renewed and it has all been confirmed by the DED.
I cannot get my cheques back from them as there is no one to contact. I am afraid however that they are still going to try and encash the cheques, which have been made out to the company and not an individual.
What do I do please? Dubai Police referred me to Dubai Court but I have not been successful with either of them.
Banks have a compliance requirement to check timely renewal of trade license of companies that hold accounts with them as part of their KYC CDD operations.
It is accompanied by a notice to the account holder that the bank account will cease to be operational if the renewed trade license is not provided. However, the implementation of the same may not be prompt in practice.
In either case, if a post-dated cheque is deposited for encashing, the bank cannot refuse to accept the deposit of the same just because the license is not renewed.
The bank will always receive the payment (when your cheque is deposited for payment) but for the beneficiary to withdraw, it is a different story which would require an active trade license and of course an active ATM.
If you require that the cheque should be stopped for payment you need a court order, and for that, you have to file a suitable legal proceeding.
With best regards,
Mrs Khan
