A Dawson City man is facing charges of fraud and forgery after $49,000 in bad cheques were cashed in the city.

The RCMP warned local businesses of bad cheques circulating around town last week.

Police had sent out an advisory for businesses to be wary of cheques bearing the name of Steve's Music Shop which were making their way to shops around Whitehorse. The cheques had appeared legitimate, but the business had closed in early June.

It's estimated the $49,000 in bad cheques were used for 47 separate transactions at local businesses, restaurants and banks between July 18 and last Friday.

At around 3:25 p.m. Friday, officers were called to the Chocolate Claim, where they arrested a man who had Steve's Music Shop cheques.

Kevin Kohlhauser, 40, remains in custody, with his next court date set for tomorrow.

As the RCMP continue their investigation, businesses are reminded to review their practices on whether to accept non-certified cheques.

Documents which have personal and financial information should also be destroyed to avoid being a victim of identity theft or fraud.