Been denied for a bank account or had a bank account closed? You could be in a system that reports banking usage history and check writing history to banks on a daily basis, causing trouble for anyone who has ever made a mistake or error with their check writing.
There are three main systems that track banking history, and they are EWS, TeleCheck, and ChexSystems. Of these, the last is probably the most well-known.
ChexSystems
ChexSystems furnishes financial institutions with “account verification services” to “protect” the banks by alerting them to applicants or account holders who have ever had a check bounce or who have had a history of NSF charges or overdrafts. When ChexSystems sends a report to a bank, it can often result in your being turned down for a checking account or in having your existing account closed.
The worst thing about ChexSystems is that in many cases the information is wrong – a mistyped driver’s license number or social security number can prompt your name to come up instead of a real culprit, and it is extremely difficult to get these errors rectified.
However, since ChexSystems is classified legally as a consumer-reporting agency, it means the federal Fair Credit Reporting Act (FCRA) governs the company’s handling of consumer records. You have rights under thae law, and are entitled to a free copy of your report, which can be used to dispute the information they have on you in their database.
TeleCheck
Your TeleCheck record may come up when a bank considers you for application, but may also rear its ugly head when you try to write or cash a check as well. Many places of business use a TeleCheck scanner to read a check’s information and dig deeper into your banking history to see if there are records of “bounced” checks.
This can cause embarrassment and indignity when your form of payment is declined. It can also send an alert to your current bank and they may decide to close your account based on TeleCheck’s reporting.
Like ChexSystems, TeleCheck is considered to be a credit reporting agency under federal law, which means you can also obtain your report and dispute the information it contains. Again, this can be a lengthy and difficult process.
EWS
Early Warning Systems is yet another “credit reporting agency”, but it was directly set up by the big banks themselves, including JPMorgan Chase, Wachovia, Bank of America, Wells Fargo, and BB&T Corporation.
Early Warning Systems is used by banks to pre-screen new checking account applicants or new bank customers who “may be a risk.” An EWS record can kill your chances of opening a new checking or savings account with a bank that uses it. A single overdraft, bounced check, or NSF fee is enough to get you blacklisted among the big banks that use EWS.
Like ChexSystems and TeleCheck, you are entitled to a free report and to dispute information in the EWS database, but success is unlikely unless you follow the lengthy, frustrating process step by step perfectly.
CFS was designed to make the process easier. We can guarantee that your case is handled correctly from start to finish, so incorrect information can be disputed and a resolution reached. There’s no second guessing afterwards as to whether or not every avenue was pursued. We have a strong track record for getting wrong information removed, and have support in place if your case drags on to help you get and maintain a checking account in the meantime.