79R4621 EAM-D


By:  Giddings                                                     H.R. No. 1300



R E S O L U T I O N
	WHEREAS, The paper check, one of the world's oldest and most 
common forms of payment, is widely accepted in the United States and 
internationally; it is used by businesses, governments, and 
consumers as payment for almost every type of commerce; and
	WHEREAS, In most states, if the issuer of a check has 
insufficient funds to cover that check, state law authorizes a 
financial institution to impose a reasonable penalty in order to 
cover the administrative cost of processing that dishonored check, 
and many financial institutions elect to do precisely that; and
	WHEREAS, In addition, the recipient's financial institution 
may charge the recipient--who typically is unaware of the check's 
dubious status--a penalty for the dishonored check and possibly 
could go so far as to charge back to the recipient's account the 
amount of the insufficient funds check even if the recipient's 
financial institution had already made the funds available to the 
recipient, which may consequently create overdrafts of the 
recipient's account resulting in the recipient incurring 
additional penalties arising from those overdrafts; and
	WHEREAS, Imposing a penalty upon the recipient of an 
insufficient funds check is an unfair business practice because it 
punishes the wrong party in this very common type of financial 
transaction; and
	WHEREAS, Because financial transactions involving checks 
frequently cross state boundaries, it is desirable that a uniform, 
nationwide standard be established to address this problem; now, 
therefore, be it
	RESOLVED, That the House of Representatives of the 79th Texas 
Legislature hereby respectfully urge the Congress of the United 
States to enact legislation to prohibit a dishonored check 
recipient's financial institution from assessing a penalty against 
the recipient and to instead authorize the recipient's financial 
institution to assess a penalty against the issuer's financial 
institution, which may in turn pass that penalty down to the issuer; 
and, be it further
	RESOLVED, That the chief clerk of the Texas House of 
Representatives forward official copies of this resolution to the 
president of the United States, to the speaker of the house of 
representatives and the president of the senate of the United 
States Congress, and to all the members of the Texas delegation to 
the congress with the request that this resolution be officially 
entered in the Congressional Record as a memorial to the Congress of 
the United States of America.