Questions & Answers
Clearing a case for a loan or credit card after payment of fine
Is it true that the new rules say that paying a fine (which is 10% of the total loan) for not paying loans/credit card or bounced cheques will get someone cleared from loan/debt cases?
After paying the fines, will a police clearance be issued and there is no more obligation to pay the previous loan amount now?
If for example, someone owes the bank a total of AED 35000 late payments and interest, the person only pays a fine of AED 3500 and the case is cleared?
Dear Questioner,
I would like to point out the above information is not completely true. Please note that criminal liability and civil liability are two different concepts of legal liabilities.
Here in the UAE, dishonouring a cheque is considered as a criminal offence against which you can file a police complaint.
Filing a complaint in the police station acknowledges the criminal aspect of cheque bounce.
The public prosecution may give a judgement imposing a fine or jail term, depends upon the amount. The whole purpose of the criminal complaint is to punish the defaulter.
Whereas civil liability is something personal and the purpose of filing a civil case is to recover the outstanding from the defaulter.
Hope the above explanation gives you proper clarification.
Thank you.
