Posted December 16, 201810:13 am
Most consumers do not know that banks look at their ChexSystems report to decide whether or not to allow the person to open an account. ChexSystems, a credit reporting agency, is used by 80% of U.S. banks. The banks refer to the ChexSystems report to find out if a person has any negative activity reported. Banks typically refuse accounts to people with negative reports.
“Negative activity” may include minor problems like failing to pay an overdraft fee by the deadline or much more serious infractions such as bank fraud. Banks decide what information is put into ChexSystems, which then gives them control over who can open accounts. The inability to open a bank account makes saving for the future or cashing paychecks difficult and expensive.
Consumers do have the option to request their ChexSystems report. This can be done by calling ChexSystems at 800-428-9623 or by going on their website (https://www.chexsystems.com/web/chexsystems/consumerdebit/page/home/) to the “Request Reports” section and filling out the consumer disclosure form. If any information on the report is wrong, consumers should request a correction in writing. Documents that prove the error, such as bank statements or payment records, should be provided. If the report is accurate, the consumer should try to pay the debts owed or enter into a payment plan with the creditor. Then, they should ask the creditor to remove the information from ChexSystems.
Finally, consumers can also look for a financial institution that does not use ChexSystems. For a list of banks and credit unions in Ohio that do not use ChexSystems, see http://echeck.org/non-chexsystems-banks-in-ohio/. Unfortunately, none on this list have locations in northeast Ohio currently.
This article was written by Kathryn Kileen and appeared in The Alert: Volume 34, Issue 2.