The Law Dictionary

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NOT SUFFICIENT FUNDS (NSF) Definition & Legal Meaning

Definition & Citations:

When the amount available in the drawer’s account is less than the amount stated on the check, the bank reserves the right to return the check to the depositor. When this occurs, the depositor is expected to pay a penalty to the bank. If this occurs frequently, the bank reserves the rightto unilaterally close the holder’s account. It is considered a crime in some locations, to issue a check that will be returned.


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