With the arrival of Ramadan, the recurring annual debtors issue comes to the fore once again. We have consistently advocated for a fair approach to the treatment of debtors, one that respects the law but also incorporates social customs and traditions, moving away from overly harsh penalties.
It is our view, stated numerous times, that debtors are typically pushed into this situation by unavoidable, compelling circumstances. Unfortunately, some creditors exploit this vulnerability to increase their personal wealth. They impose stringent conditions that often result in imprisonment if debtors fail to meet their obligations, especially when instruments like dud checks, promissory notes or other financial documents are involved.
As previously highlighted, the nation faces a crisis involving about 120,000 individuals with financial claims against them. Arrest warrants were issued against the majority, leading to a hot pursuit by authorities. Many have already served long prison sentences, resulting in the breakdown of families, severe social and economic difficulties, and a surge in demand for social assistance.
A fundamental legal principle dictates that “the liability falls on the one who misappropriates money.” This implies culpability on the part of the lender who extends credit to someone known to be unable to repay, yet still accepts a promissory note or check. This suggests that the money was advanced in bad faith -- an act that is punishable by law. The law clearly states: “Whoever gives a check in bad faith, knowing it is not backed by sufficient and available funds shall be punished by imprisonment and a fine not exceeding KD300, or any of these two penalties.”
The failure to apply essential legal and religious principles in Kuwait resulted in government agencies functioning merely as debt collectors for creditors, rather than as impartial bodies tasked to prevent public harm. Consequently, those who profit from the misfortune of others now hold a position of advantage, because the law currently empowers them, whereas the fundamental principle should dictate the opposite -- the burden of responsibility should rest with the party that misappropriated funds. While the importance of preserving rights is universally accepted and not disputed, the current system is flawed.
Although commercial transactions usually adhere to the rules, such as secured lending where collateral may exceed the loan value, which is standard practice for banks and financial institutions, the issue arises from lending activities undertaken in bad faith, which have proven to be catastrophic. For decades, Kuwait has maintained the practice of lending money against bounced checks, a system that, as introduced, led to numerous societal problems. In contrast to global trends where financial transactions are typically not grounds for imprisonment and the issuance of a dud check is not criminalized, Kuwait continues to grapple with this issue.
The impact is evident annually during Ramadan, when campaigns are launched to settle the debts of those in financial distress. Last year alone, about 9,000 individuals incarcerated for financial offenses applied for debt settlement. With the total prison population exceeding 40,000 across all crimes, this staggering figure means financial difficulties account for about a quarter of all inmates. This untenable situation necessitates action.
We strongly urge the active advisor, Minister of Justice Nasser Al- Sumait, who is currently working on legal amendments and modernization, to revise the law. Such an amendment is crucial to ease the burdens of the courts, the Central Prison and Kuwaiti families. Following the example of most other nations, the issuance of a dud check should no longer be treated as a felony punishable by imprisonment. Finally, we commend the banks that operate responsibly by granting loans solely to those with collateral, rather than relying on checks that could lead to imprisonment.
