See an attorney that handles FDCPA claims. If they are threatening to take an action that cannot legally do, then it is likely a FDCPA violation.
This is general advice based on limited interaction in an online forum. The reply does NOT create an attorney-client relationship. You are strongly advised to seek the advice of an attorney in your jurisdiction after you have presented them with all of the facts.
Many criminal prosecutions must be brought within 10 years for felonies and 2 years for misdemeanors. I do not know why a merchant would sit around for 7 years before deciding to pursue criminal charges against you. Also, writing a bad check is not always a crime.
It is illegal for a debt collector to threaten you with criminal penalties if you did not commit a crime. If you are really concerned about this, you should call a lawyer to talk about your options.
They are jerking your chain. Take the information as to their location and get their contact information. Find a debt collections attorney or consumer rights attorney and show them your evidence.