It has been this way for more than a year now. There are a few people here n there that are denied when the chexsystems report is very recent, and those that had accounts with BOA in the past that were charged off and left an outstanding debt. But no, we have no idea why entirely. Back in 2001, they were part of a survey that they tried to keep quiet.
Back in 2001, a reporter, at the Washington Post wrote a story about chexsystems called
" Checking Error Could Land You on Blacklist". It tells how unfair chexsystems is.
http://www.washingtonpost.com/ac2/wp...3946-2001Sep29
How for even the smallest amount of money, a person can wind up reported. Personally, I have known someone reported for 13 cents. Of course, this is not likely to happen to someone well off and financially stable that brings deposits to the bank. It is the average person that it happens to frequently.
The story also tells how even a small mistake can be called "account abuse" or "fraud" without any real proof, when it may have been a simple error or an error by the bank. Some banks have policies that even a closed account can be re-opened if an ACH comes through on the account, allowing the account to be over drawn and left in the negative. Someone who has closed an account and moved to another state would have no knowledge of this happening before it is too late. Sound unfair to you?
Well after the story was published in the Washington Post the National Community Reinvestment Coalition has an article about how they decided to conduct a survey with 6 leading banks that all requested to remain anonymous when the NCRC discussed the survey results.
The National Community Reinvestment Coalition is a national nonprofit organization with 640 dues paying nonprofit organizations located in every state in the country. NCRC was founded in 1990 to unite efforts around the nation to increase the flow of private capital into traditionally under served communities.
The NCRC’s survey found that the banks use information in the Chexsystems in an inflexible and reflective manner that is most likely not related to risk. For example, in 1999, five of the six banks denied checking accounts to customers whose ChexSystems reports were five years old. Four of the banks responded that they do not disregard a Chexsystems entry if a consumer repays the overdraft amount. Only one of the banks used factors such as steady employment or paying rent on time in addition to the Chexsystems record when deciding whether to open checking accounts for applicants.
Starting in 2000, two of the banks decided that they would disregard Chexsystems overdraft records that are more than three years old. Later, two of them decided that they would disregard a Chexsystems entry that is more than one year old when the consumer has repaid their debt. One bank would offer a non-check writing transitional account, the Federally subsidized Electronic Transfer Account (ETA), to those with Chexsystems records.
Not surprisingly, the banks with more lenient policies for referring customers to the Chexsystems database referred fewer customers. One bank responding to the NCRC survey would report customers to the Chexsystems database only 30 days after an overdraft while another bank waited 60 days before reporting. One bank considered $35 overdue as an overdraft when all other banks on average considered $67 overdue as overdrafts. The bank with the lowest dollar considered referred about 4 percent of its customers to Chexsystems. So, the bank with one of the more lenient policies referred less than .2 percent of its customers to Chexsystems.
Many of us believe that this survey had triggered BOA and others to become more lenient at a later time. Most of the banks that were part of the survey claim to have changed their policies on chexsystems but from what I can tell, most of the ones included in the report are still denying most everyone reported to chexsystems.
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