Issuing a worthless check is a crime in Wisconsin. Accordingly, when a tenant pays his/her rent or security deposit with a worthless check I typically advise my landlord clients to do two things: (1) serve the tenant with the proper notice terminating tenancy for failure to pay rent so that an eviction action can be commenced against the tenant, and (2) report the crime to the local police so that a potential criminal action could be initiated against the tenant. Unfortunately, this second piece of advice is no longer valid — at least for clients who own or manage rental property in the City of Milwaukee.
The Milwaukee Police Department have in place a written policy statement containing 20 exceptions to its normal prosecution of “worthless check” complaints, and one of those policy exceptions directly affects landlords and/or their agents: Policy Exception 17 states that “checks issued pursuant to any contractual agreement, including the payment of rent or security deposits for rental property,” will not be pursued. The Milwaukee Police Department does not provide an explanation or rationale for this policy exception. And upon reading the entire list of policy exceptions, I am hard pressed to come up with any situation involving the issuance of a worthless check which wouldn’t fall under one of the twenty exceptions. Apparently, the Milwaukee Police Department is not interested in pursuing individuals who pass worthless checks in general and, specifically, the MPD will not pursue tenants who pass them to their landlords.
This means that it is more important than ever that City of Milwaukee landlords and/or property managers do thorough and legal background checks on all prospective tenants in order to increase their odds of obtaining trustworthy and responsible tenants. Secondly, landlords may want to consider adding language to their standard rental agreements stating that any and all rental payments and security deposit payments must be made via certified funds (i.e., certified check/cashier’s check or money order). Third, City of Milwaukee landlords now have another reason not to allow tenants who have fallen behind with their rent payments to continue to reside in the their properties.
In order to protect yourself and your properties, landlords or their managers should consider commencing an eviction against a tenant as soon as the tenant is late in paying even one month’s rent. If landlords continue to allow tenants to get further behind in rent payments and continue to accept promises of future payments from such tenants, landlords will increase the chances that the promised past due rent payments will be made via worthless checks — and now landlords will receive absolutely no assistance from the Milwaukee Police Department when trying to recover these funds from their tenants.