In general, ChexSystems is an information sharing platform owned by a company called eFunds. The platform enables member financial institutions to share information about people that mishandle their bank accounts, both savings and checking accounts. The system aims to identify people who engage in banking irregularities such as check fraud. It is important to note that ChexSystems can neither approve nor deny one the opportunity to open a new bank account. However, people who appear in the system generally find it difficult to open new bank accounts, particularly with the member banks. With that in mind, here are ways to ensure you stay off ChexSystems.
Obtain Your Consumer Report
Under the Fair and Accurate Credit Transaction Act (FACTA) of 2003, one can dispute the accuracy of information in a consumer report. In fact, you have the right to get a free copy of this report at least once every 12 months. This is necessary because your report may contain errors that a financial institution may use to deny you the chance to open an account.
Scrutinize Your Report
When you get the report, go through it carefully to see if there are any discrepancies or “Reported Information.” For instance, money that you owe member institutions will show up as “Reported Information.” You should also check for signs of identity theft such as withdrawals or money transfers in countries that you have never visited. Another red flag is any inquiry from a company or payday lender you have never dealt with. Research carried out by the US Public Interest Research Group (USPIRG) found that one in four consumer reports contain errors that could place one in serious financial trouble.
Dispute Errors In Your Report
If your report contains errors, you can dispute them by informing ChexSystems. Make sure that you provide documentation to substantiate and support your claim. For example, you could circle a false creditor claim and then attach the relevant payment records. Send your dispute letter via fax or mail and then wait for a response. It is advisable to retain copies of this letter for documentation and evidence purposes.
Freeze Your Consumer Report
You can place a “security freeze” on your report to prevent financial institutions and consumer reporting agencies from accessing it. Nevertheless, you should weigh the pros and cons of taking such a step. A major advantage of exercising your right to a “security freeze” is preventing the approval of loans without your consent. The downside is institutions or agencies that request your report will learn that you have blocked access to the information it contains.
Take note that such a freeze will not prevent creditors from accessing the same information. Companies that provide demand deposit information services will also be able to access your consumer information.
Opt Out Of Prescreened Credit Offers
The Federal Fair Credit Reporting Act (FCRA) allows agencies that provide credit-reporting services to include names of consumers on lists that financial institutions or insurers use to make prescreened credit offers. At the same time, the FCRA gives consumers the right to opt out of such lists. This means that you will not receive offers from insurers or banks that you have not initiated.
Have Your Name Removed From ChexSystems
If you have proved that your report had errors, you should have it removed from the deposit account verification database. Do not assume that a reporting member such as a bank will take steps to clear your name. In fact, such a member is under no obligation to prove your innocence. You have to take up the matter with the financial institution that reported you to file a request to have your name removed from this database.
Responsible Account Management
Having your name in this database can be frustrating because it would be almost impossible to open a bank account. With this in mind, the best way to stay off the list of people who have committed banking malpractices is by managing your accounts in a responsible manner. Remember once your name is in this database, it can stay there for up to five years.
This can have serious ramifications because other parties other than banks can access information in your consumer file. These include people involved in business transactions with you, people or bodies that acquire court orders to review your credit status, employers, landlords, and courts for purposes of determining child support cases.
When you apply to open a new deposit account, your bank will likely query the ChexSystems database to find out if you have mishandled your account within the last five years. Some of the measures that you can take to stay off this database include obtaining and scrutinizing your consumer report as well as responsible account management.
When you have your finances straight, you can begin to consider long-term investment options. This includes adding gold to your retirement account, to hedge against the failing U.S. dollar.
Gold is just one solid example of a long term investment that has performed for over 100 years. In fact, a $10.000 investment in gold in 2002 would now be worth over $50,000. You can check the price of gold here.