Telecheck Electronic Check Acceptance Service Sent me an invoice for $168.77 for a Walmart Store that is in another state. Saying that my paper check could not be converted to a special check reader. The transaction that I supposedly made cannot City of Industry, California

I had the same experience, except I tried to write a check to my insurance company at one of their retail outlets.   They would not except my check!  I couldn't believe it.  The gave me a piece of paper that said they could not accept my check based on information provided by telecheck.  When I called, telecheck said i wrote a check in Texas (i live in Michigan), and they could not process the check because telecheck could not read my bank account number!  I was in Texas, and I did write the check, but the funds were always available.  I never reconciled my checkbook, and didn't notice that the check never cleared (I'm going to check with my bank to make sure).  In any event, the ineptness of TeleCheck cost me a great deal of time and money.  The gas to and from my insurance office (25 miles), the 2-3 hours I spent on the telephone with Telecheck to resolve this matter. and the humiliation of the whole incident.  I figure that they owe me.  This is what I'm going to do.  1.  Change insurance companies 2.  Not pay the outstanding amount unless Telecheck reimburses me for my costs associated with their ineptness. 3.  I'm going to several of my local Walmarts and I may load my basket full of expensive steaks, milk, eggs, frozen foods and roll the basket around for 2-3 hours.  I will then attempt to pay with a check.  If they don't accept my check, they will have to deal with the costs associated with Telecheck in the form of unsellable groceries! 

First thing I would do is contact my bank or even visit the bank with the invoice in hand.

Then, I would contact the Wal-Mart in question.

Telecheck is a legitimate company. 
 
It sounds like someone passed a fraudulent check at Walmart using your banking information.
 
Obviously you would not be responsible for someone stealing your info, but if it were me, I would file a police report and follow ID theft procedures to protect yourself. Go to the FTC (dot) gov site and look under Identity Theft for a list of items to do and contacts for filing various reports with various agencies, including the big 3 CRA's.

I hope you get this stopped right away before any further damage is done to you.