Legal Question in Business Law in California

Re: release of financial liability

Let's see, you provided full value, merchandise or cash, in exchange for checks you thought were good. You were, however, unable to negotiate the checks any further because they were "bad." In the course of this, you're told the reason the checks aren't being honored is that they were stolen. This is your first inkling of this. So far, no criminal liability.

Next, you contact the person who presented them to you, and he came in and made you whole.

At this point, you are made whole with fresh funds, with no reason to think these are also stolen. That's not a crime, either. However, you are now face-to-face with someone whom you have reason to believe is a thief. Do I read your facts correctly on this?

If I'm correct, your potential criminal liability doesn't flow from the money transactions, but rather from whether you have a duty to report the information you seem to have about a thief. Or possible thief.

I'd say you probably have none. Harboring, sheltering, giving aid to, etc. a crook is itself criminal, but, and gosh it's years since law school when I had to deal with this, merely refraining from reporting suspicions is not itself punishable.

I wouldn't get any signatures -- I'd just tell this individual politely but firmly -- after he pays you off with "clean" funds -- that you don't want to see his face in your store ever again.

A few days later, you might ask your neighborhood cop if he wants to drop by to take a report on all of this. He may or may not give a hoot, but you will have done your duty.

If you need more responses, or more detail, please re-ask your question on LawGuru under a criminal law category.

Re: release of financial liability

No, provided that you neither knew nor should have known that the checks were stolen. You were a victim of this crime and not a perpetrator.