This is a rush question...
I have a client who currently has a checking account, however, she is
moving to the New England area and needs to open a new checking
account there. We have found that, due to a past relationship, two
"credit history" reporting agencies that do background checks for
banks have provided information which make it impossible for her to
open a new checking account with the banks that use them. However,
there are other agencies employed by banks in New England that do not
report the same information.
I would like to find out which banks in MA or NH do not use
"ChexSystems" or "NCPS" for new account verification purposes. Some
banks use "Telecheck" and some banks, especially smaller ones, may not
use such a service at all. I would like to obtain a list of 20 banks
that do not use these two previously mentioned services, along with
their locations and phone numbers. If MA and NH seem to be difficult,
other New England states can be researched (RI, CT, VT, ME, in
descending order of interest).
I routinely obtain this information when conducting background checks
on new/potential employees for businesses. You can call these banks
(costs for long distance calls will be reimbursed within tip) and
directly ask the customer service department what company(ies) they
use to determine whether or not to open a new checking account for an
individual. (Banks for each state are listed in yellow pages on
internet--for listing purposes, "MapQuest" distance from Boston could
be used to rank them; the closer to Boston, the better.) This is
public information and if you tell them you are conducting a
background check for employment purposes, and that knowledge of what
company they use for this will indicate how creditworthy/bondable a
person might be, they should not have any problem with telling you
(they do not need or request a name). They probably won't even
require any reason for the question.
Secondly, please find out how many business days it will take to clear
an initial deposit made by check from Citizens Bank in MA for the
purpose of opening a new checking account, if possible. Email can be
used to obtain all of this information as well.
Please provide a list of 20 banks. You do not need to contact Fleet
Bank, Citizens Bank, Granite Bank, Wainwright Bank, or Peoples Federal
Savings Bank as they have already been contacted. A tip, commensurate
with effort, will be provided (in addition to covering phone call
costs, if any since some banks do not have toll free numbers). If you
begin this research and feel that it will involve more time than
expected, please inform me and I will increase the price or promise to
pay a certain additional amount in the tip. Thank you! |
Request for Question Clarification by
missy-ga
on
16 Nov 2002 23:03 PST
Hello Henry!
As it happens, I have a list of banks nationwide that do not use the
systems you mention. However, I'm finding that many of these banks
are "Internet" banks - that is, no branch offices, but ATM access for
both deposits and withdrawals, and 24 hour, online account access.
Would such banks be acceptable for your client? They are FDIC insured
institutions.
--Missy
|
Request for Question Clarification by
missy-ga
on
17 Nov 2002 00:12 PST
Hello again,
Searching the lists I have of banks verified to not use ChexSystems or
NCPS, there are six Internet banks, one bank in MA and one in CT.
That's a rather meager selection, but perhaps a start if your client
is amenable to an Internet bank.
I have sent query letters to fifteen banks in the Boston area.
However, it is currently 3:00AM EST, Sunday. I don't expect any
responses, nor do I expect that any further progress can be made until
the banks open at 9:00AM Monday morning.
I will resume work on this question at that time, including making
telephone calls as necessary, and will continue sending query letters
throughout tomorrow. I just wanted to let you know that your query
was being investigated, and keep you apprised of its status.
--Missy
|
Clarification of Question by
henry041696-ga
on
17 Nov 2002 11:22 PST
Hi Missy,
Thank you for working on this. Could you give me a little more
information about the "Internet" banks, so I can determine whether
that would work or not? As you mentioned, it might be a start, but
probably not if it involves a long wait to initially access funds.
They might be useful as "back-up" banks, though, as mentioned below.
First, how does such an account get opened? Does an initial deposit
need to be mailed to these banks or how does an initial deposit get
made (e.g., credit card payment online)? Then, would one need to wait
until an ATM card was received from the bank to obtain funds from the
bank? My client would not want to use her current account to transfer
funds into as the purpose of all of this is to have an account she can
access in New England. So, for her to obtain funds from deposits she
has made into an internet bank, without a "physical" checking account,
where the funds could be transferred and she could withdraw them, I
assume she could only obtain the funds by using the ATM card. In that
case, how long it would take to receive the card after opening the
account might be an issue. In addition, how long an internet bank
would hold an initial check deposit before clearing it would be
important to know.
Also, I probably should have mentioned that any banks that rely on
typical credit reports, such as that from Experian, would not work
either. I am assuming that the Internet banks *might* use that method
to determine whether they want to open a new account for an
individual. (I didn't think to mention that since banks don't
typically use that method for this, but I could see why an "internet"
bank might do that.)
Anyway, my client does want to have two or three accounts opened, just
to be safe in case one closes her out after reviewing further reports
that are not always done up front (apparently, one of her banks used
NCPS on a monthly report basis, which flagged her as a banking risk,
so that bank closed her account weeks after she had successfully
opened and been using it).
To make this easier for you, I could mention that, in general, banks
in smaller towns are more likely to use "smaller" reporting agencies.
So, banks in or very near major cities like Boston, and those that
have a number of branch locations, are less likely to work out. What
I might do, to make this easier, is perform a search for banks in
smaller towns with few, if any, other branch offices, that are in the
closest vicinity to Boston (e.g., 100 miles away rather than 300, if
possible). Then I could forward that list to you, which should include
name, location, and phone number info. However, that would not be
something I would think I should post here, so it would seem best to
email it to you. If that is not a good idea, then perhaps you could
do this search yourself by using "MapQuest" and clicking on "yellow
pages" and then "banks." If you requested banks in NH and listed them
by distance from Boston (it should give you that option), you could
then go through and attempt to eliminate the more major banks and
focus on contacting the smaller banks, to increase your odds of
finding appropriate banks.
Since NCPS is located in MA, it seems that most of the banks in MA do
tend to use it, esp. those in Boston. That's my reason for suggesting
you start with NH if you are going to do a search. NH banks are more
likely to use ChexSystems than NCPS; however, more banks in NH use
neither of these companies, which is what we're looking for. Now that
it has occurred to me, it might be good to confirm that any banks that
do not use the two mentioned companies also do not rely on a credit
reporting agency -- I believe that they are all now included in
Experian, as far as TRW, Trans-Union, and Equifax go, but I am not
absolutely certain of that. Please let me know if you find out or
already know.
In terms of continuing the research process over the weekend, I think
most of the banks you queried that were apparently in/near Boston (?),
will use NCPS. To get a jump on things, you might consider doing the
search I mentioned (or asking me to do it and pass results on to you)
and then query those banks so that you might have responses by around
9am E.T. on Monday. My client is hoping to attempt to open an account
or two on Monday, if at all possible.
Thanks again for your help. My hope is that the info I provided above
will help to narrow things down a bit and speed up the process, saving
both of us some time/energy. Take care.
|
Request for Question Clarification by
missy-ga
on
17 Nov 2002 14:52 PST
Hi Henry,
Let me make sure I have all of this correctly:
You need banks that, when verifying someone for an account use:
--No ChexSystems
--No NCPS
--No credit reporting agencies ?
This is going to be an awfully hard nut to crack. Fully eighty
percent of US banks use ChexSystems. Those that don't mostly use
either NCPS or credit bureau reports. In fact, there are only about
200 banks nationwide that do not use any of the above verification
systems, and several of those are Internet banks.
These restrictions, coupled with the apparent need to access the funds
again immediately, may make it impossible to answer your question to
your satisfaction.
With respect to Internet banks, I use one myself (NetBank), and have
never had any difficulties accessing my funds. Each bank is
affiliated with an actual brick and mortar bank and has its own
policies. Typically, you can make your initial deposit by mail or
through a wire transfer from an existing checking account. Wire
transfer funds are usually available immediately. If you choose the
mail option and use a check, all but the first $100 of the deposit is
typically held for five business days (this is common for new
accounts, and remains the rule for the entire new account period -
usually 180 days). If you make the initial deposit by money order,
the entire amount is usually available immediately.
With NetBank, I received my check card within five days of making my
initial deposit. I also had access to my account information
immediately online, which allowed me to print my own checks (I prefer
to do this, using VersaCheck software), rather than wait two weeks for
my first box of checks. Now my deposits are made by direct deposit of
payroll checks, ATM deposit of "non-urgent" checks (birthday gifts,
etc.) and Priority Mail deposit of anything else. Deposit taking ATMs
are available nationwide.
If your client is in ChexSystems because of a prior affiliation with
someone, she can dispute her way out. ChexSystems is bound by the
Federal Fair Credit Reporting Act, and must remove inaccurate
information.
Have her get her ChexSystems report:
ChexSystems
http://www.chexhelp.com/
She can also obtain it by mail:
ChexSystems Customer Service
12005 Ford Road, Suite 600
Dallas, TX 75234-7253
Fax: (972) 241-4772
For further instructions: (800) 428-9623 or (972) 280-8585
The ChexSystems customer service line is: (800) 513-7125
If she's been denied a checking account in the past 60 days because of
ChexSystems information or has reason to believe the information is
inaccurate due to fraud, she can get the report for free. Otherwise
it's $8. I have forms available to help her dispute the information.
Getting out of the system, while not immediate, is a good long term
solution.
I will continue investigating your query, but I must advise you that
your restrictions are very narrow, and I'm doubtful that they can be
met as quickly as you need.
--Missy
|
Clarification of Question by
henry041696-ga
on
17 Nov 2002 18:49 PST
Missy,
Thank you for the further information. Yes, the 3 things you listed
are correct. It also seems that an internet bank would not really be
the best way to go for her. I imagine there are limitations on how
much you can withdraw using the ATM card and that could make it very
difficult for her to accomplish what she needs to while moving. I did
not realize that such a high percentage of banks used ChexSystems. I
do know that banks up in the northern section of NH (rural and remote)
are known to use TeleCheck, which does not seem to be a problem for my
client. It may be that being in New England may be an advantage. My
guess is that NH would be one of the states most likely to deviate
from the norm, considering the culture there. But, I understand your
concern about being able to adequately answer the question if there
are truly only 200 banks in the U.S. that do not use one of the 3
"checks" mentioned for new accounts--how did you manage to figure that
out? I have never had a bank run a regular credit check on me when
opening a new checking account; I really don't think that is very
standard. Typically, when issuing a credit card, a credit check is
done via Equifax, for example, but I did not think that route was
typically taken for opening new checking accounts. I just assumed it
might be the way an online bank might check an applicant's background,
but I have never dealt with a purely online bank. If they are
associated with actual banks, then I imagine they use the same system
that bank uses (e.g., ChexSystems or NCPS).
Anyway, if you want to attempt to answer this question, you could
consider what I proposed regarding researching banks that are small
and rural, with the best bet for a focus being NH. My client was
married to the person who caused the bad credit issues. Getting
herself separated from what he did will be difficult, since they were
joint accounts at the time. Otherwise, that is what she would have
already done. She is planning to pursue that, but it will take time
and legal intervention.
There may also be banks in MA that are small and rural that do not use
NCPS or ChexSystems (or the national credit bureaus/agencies), esp. in
western MA. That is why this question might involve telephone work, as
I originally mentioned -- the smaller and more rural banks don't
always have toll free numbers or websites, which is actually a good
indication that they *might not* use the more typical methods of
credit background checking.
If you do not plan or wish to contact the smaller, more rural banks,
then it probably would be next to impossible to find banks to put on
the list here. I thought I kind of covered that in the explanation of
the question, by suggesting that banks without many branches be
considered for the most part. Why don't you let me know asap whether
you want to pursue this or not. If you contact/research the types of
banks I've suggested and keep a list of who you research and what
agencies they use, I will still pay you if you really have no luck in
locating usable banks. Otherwise, I assume I will need to contact
these smaller banks myself. At the least, if you did make an effort
to find remote banks that fit the bill and could provide me with a
list of who you ruled out, it would then save me a lot of time if I
wanted to continue looking (I would know who not to bother
contacting). I do know, though, that TeleCheck is an option in NH,
I'm just not sure exactly where.
So, let me know what you want to do. I would think that an informed,
focused effort on this could produce some results in an hour or two on
Monday morning, E.T., but I could be wrong. Just out of curiousity,
how were you able to determine that 80% of U.S. banks use ChexSystems?
Thanks for your feedback,
Henry
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Request for Question Clarification by
missy-ga
on
17 Nov 2002 23:17 PST
Hello again, Henry,
I do intend to continue my research for you by telephone during normal
business hours on Monday. There isn't much one can do with banks on
the weekends, alas! I just want to keep you fully informed as I
proceed - that includes filling you in on any difficulties. Clearly,
your client is in need of solid information, and I would feel
dishonest and unethical if I led you on with false hopes. You also
need to know that a thorough search may take several days to complete,
and the chances of finding precisely what your client requires are
pretty slim.
I don't mean to sound discouraging, but those are the facts as I have
them.
Let me address your questions, then you can decide how or even if you
want me to proceed.
Regarding your client's problems with ChexSystems:
As with any consumer credit report, ChexSystems is required to remove
incorrect information from your client's file. She can dispute the
information in her file if she was not responsible for the problems,
even if she was named on a joint account. She is protected by federal
statute in this situation. Please help her dispute this information
so she will have a long term solution.
ChexSystems and their ilk are not the ultimate authority when it comes
to granting checking privileges. Even if a bank declines account
privileges based on such a report, she need only speak with the branch
manager, who *is* the final authority. If she can produce a
satisfactory employment reference and she explains her personal
situation (and perhaps produces a divorce decree, separation decree or
restraining order), the bank manager will most likely be sympathetic
to her situation and open an account in spite of a derogatory report
from ChexSystems.
Regarding ChexSystems and banks:
In 2000, The Wall Street Journal profiled ChexSystems, and raised
questions of whether banks used ChexSystems as a risk management tool,
or as cover for deliberate disenfranchisement of low and middle income
people (such people have an annoying tendency to *use* their money,
making them far less profitable for banks to have as customers).
The original article is no longer available online, but several pages
reference it:
"According to the report in the Wall Street Journal, ChexSystems is "a
national database to which 80% of bank branches in the country
subscribe. Once lodged in ChexSystems, you automatically stay there
for five years, whether your offense was bouncing a check or two or
committing serious fraud. The large majority of banks using
ChexSystems reject any checking-account applicant they find in the
database." "
ChexSystems, National Database of Bad Check Transactions, Profiled in
WSJ
http://www.ctdata.com/articles/2000/08/01/0535215.shtml
"Over the summer of 2000, a Wall Street Journal article elevated the
use of ChexSystems into the national spotlight. Throughout the 1980's
and 1990's, banks had been quietly using the ChexSystems, a private
sector database, as a resource in determining whether to offer
applicants checking accounts. Maintained by the check printing
company Deluxe Corporation, the ChexSystems database tracks the
records of customers whose checking accounts have been closed due to
fraudulent activity or overdrafts. Banks enter into contractual
arrangements with ChexSystems under which they report the names of
customers whose checking accounts are closed. In return, banks have
access to all the names entered into the ChexSystems database.
Currently, about 80 percent of the depository institutions in the
country use the ChexSystems database when reviewing applications for
checking accounts."
ChexSystems: Disenfranchisement or Risk Management Tool?
http://www.ncrc.org/cra/ChexSystemsReport.rtf
See also:
ChexSystems: Blacklisting Customers?
http://www.ncrc.org/cra/ChexSystems.html
Additionally, I maintain access privileges to a continually updated
database listing banks which do not rely on such verificatiion
systems. The listing once topped out around 300 banks nationwide.
That number is rapidly shrinking, and is now less than 200, as more
and more banks institute tougher measures to combat fraud, tighten
security, comply with the newly implemented USA-PATRIOT Act (which,
among other things, compells banks to toughen up identification
procedures) and meet shareholder pressures to reduce risk and increase
profitability.
You are correct that it is not "standard" practice for banks to use
credit reports to verify new account holders. As more banks scramble
to decrease fraud, however, a small percentage of banks are turning to
consumer credit reports. My brother works for one such institution -
a small, rural Ohio bank that is so small, it cannot justify the
expense of subscribing to one of the previously named verification
systems.
It is the smaller, rural banks that may use this method of
verification. This would seem to pose a significant problem for your
client.
If you still want me to proceed, I will focus my efforts on small
banks in rural NH and MA, and keep a record of who I contact and what
they have to say. I just want you to be aware that your needs are a
bit complex, and will require time and some degree of delicacy to
research properly. It's quite likely, for reasons noted above, that
what you require is not obtainable. I wouldn't be serving you very
well if I didn't inform you of this in advance.
Please let me know how you'd like me to proceed, if at all.
--Missy
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Request for Question Clarification by
missy-ga
on
18 Nov 2002 08:03 PST
Good morning, Henry,
I'm very sorry, but I find that I will be unable to proceed any
further with your question.
After attempting (unsuccessfully) to compile a list of "rural" banks
and discussing options and possible solutions with my own banker, it
has become quite obvious to me that my abilities will not be
sufficient to meet your complex and highly specific needs.
My banker explained that it is quickly becoming a matter of policy for
traditional banks to use some sort of verification system, no matter
where they are located. She suggested that your client consider
joining a credit union - though these are not banks in the traditional
sense, they do offer banking services and often only require that a
person be a resident of a certain area to obtain credit union
membership. Credit unions tend to be much more lenient and often do
not use any sort of verification service. She also strongly suggested
that your client simply approach a bank branch manager to discuss her
situation.
Perhaps the following resources will be of some use to you and your
client:
CreditOption's World of Credit Unions (Must be viewed in Internet
Explorer)
http://www.creditoption.com/creditunions1.htm
NonCS Banks listing (a free listing, but does require a user-name and
password)
http://www.newcheckingaccount.com/chexkit/index.html
User: 10978 Pass: 3737
I hope these are helpful to you. I'm sorry that I cannot be of
further assistance, I wish your client well and hope that she finds
herself in better circumstances soon.
--Missy
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Clarification of Question by
henry041696-ga
on
18 Nov 2002 13:56 PST
Missy,
Thank you for providing so much information, for following through on
this as far as you did, and for being so honest about the expected
outcome. I do feel you should be compensated for all of your work; why
don't you tell me what you think a fair price would be? I'm not sure
whether I should go ahead and close the question or not. Based on what
you've done, and what would seem to be your fairly unique
perspective/position from which to research this, I would assume no
one could do much else with it. Perhaps you could advise me regarding
whether to leave this open for a little while or not. Maybe I could
put it in a different category, but "Misc." is the only other one that
seems appropriate. I would think that the only thing that could really
be done would be phone calling. If I want to leave it open for
awhile, I will post another question that is titled for you, but
requires no answer, so I can pay you. Or, perhaps I could cut and
paste from this question, change the title slightly (e.g., add
"Version 1" or something) and close this one out--I'm not quite sure
how that would work, but I could probably cut & paste the original
question and then, at the end, tell the researcher to read the
responses you wrote, etc., in the closed out version. Well, thanks
again and let me know... I do want to compensate you.
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Request for Question Clarification by
missy-ga
on
18 Nov 2002 14:23 PST
Hello Henry,
I really don't know what to say here.
If you feel compelled to compensate me, you can post a question to my
attention, so this one remains open for someone who might be able to
help you further. It may very well be that someone with an inroad in
the banking community might have additional advice for you, and I'd
hate to see you miss the chance to get that advice.
I honestly have no idea what a fair price would be. I will leave that
to your discretion. I do appreciate that very much, and I thank you
for the consideration you've shown me.
--Missy
|
Clarification of Question by
henry041696-ga
on
18 Nov 2002 17:28 PST
Missy,
I want to pay you the "list price" for the question, but apparently I
can't do that unless you submit something in the "Answer" box. Why
don't you just say something about referring to the above
communications, since my new question points other researchers to this
question, and that will help ensure that they read our discourse. You
had some very important things to say or point out in this process.
Thank you,
Henry, Esq. (i.e., I'm not asking all of these questions for only
myself, lol)
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