Chexsystems is an agency of financial institution that works together to form a database which maintains the record of unwanted customers. It is referred as the first of three most important check system in the United States. In order to make sure that only financial reliable and responsible people open checking accounts at financial institutions, these banks release reports on clients who have poor financial handling skills. When a checking account of a customer is closed because of such mismanagement, then that person is reported under ChexSystems. Once you come on this list, you will have a difficult time in opening an account in any other bank or financial institution for another five years.
Since most of the financial institutions reject such customers who are on the list in ChexSystems, an individual can be extremely affected by this. But what exactly has happened to get your checking account getting closed and reported to ChexSystems? The usual answer given by the bank is “closed for cause”. There are many other ways which can end up in termination of a person’s account. These range from serious fraud to minor irresponsibility which results in major overdrafts. It is important to keep in mind that the policy can differ from one financial institution to another. Based on the type of bank in question, incidents in which accounts are closed can involve customers who misuse savings account, debit cards or ATMs, who offer misleading information while opening an account and who do not reimburse overdraft amounts to their respective banks. Read More