When a person applies for a bank account, most commonly a checking account, the financial institution contacts ChexSystems Inc. to find out if that person has a record filed in their database.

ChexSystems generates a report, providing any information it has on file about the applicant. The financial institution reviews the file, and then determines whether, or not, to open a account for that individual.

Here's how it works:

Members of ChexSystems makes an inquiry online, or picks up the phone and calls in with their bank Member ID number.

ChexSystems responds immediately, telling the bank:

• If there is an account closure on file
  
  
• Whether outstanding debts have been paid
  
  
• Whether the Social Security number matches ChexSystems data (e.g., the number may be invalid or inactive, or it may not match the name on the ChexSystems database)
  
  
• If the applicant has checks outstanding on the SCAN database which alerts retailers to non-sufficient-funds
  checks that have not been paid
  
  
• How many accounts the consumer has applied for in the past 90 days; and if the driver's license number is accurate and issued to the applicant.
  
  
• Account closed "for cause".
  (Banks differ greatly between them as to what valid reasons are for closing an account.)
  
   
• Bank was unable to collect for an overdraft, ATM transaction, or automatic payment that they honored on insufficient funds.
  (Banks report this to ChexSystems regardless of amount and often without waiting more than a few days after mailing a notice to you!)
  
  
• Multiple overdrafts.
  
  
• Savings Account, debit card or ATM abuse.
  
  
• Any acts of fraudulent activity
  
  
• Providing false information in opening account
   

If none of the above applies, members are simply told that there is no record on the ChexSystems database.

Banks report the information to ChexSystems.

ChexSystems organizes it into a central main database. ChexSystems neither approves nor denies new account openings for financial institutions. No matter what a bank manager may tell you, the decision to approve or deny an account is always up to that bank.

Those decisions are entirely up to each financial institution and its individual policies. They can choose to overlook the ChexSystems report.

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Chexsystems Solutions
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12388 Warwick Blvd                                      
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