S. wrote a check at Kmart earlier this month and it was denied. No reason was given—just “denied.” It turns out a separate company, Certegy, made the decision, so S.—who writes, “I’ve never had a bounced check”—tried to track down someone at Certegy who could tell her what was wrong with her checks.

I’ve never heard of Certegy, until April 6. I went to K-mart to purchase some items, wrote a check (which I have done there dozens of times before), and it was declined. Huh? I mean WTH?! I’ve never had a bounced check, I have over draft protection anyways. I called the toll free number, of course it’s automated, they won’t give you a reason, the recording just said “Precautionary Measures”, sooooo, what the heck is that all about? I cashed a check elsewhere a few minutes later, just fine.
 
I emailed K-Mart complaining about being the embarrassment it caused me. I emailed Certegy also, all I received from both was a form letter giving me instructions how to obtain more information about my particular situation. OK, so, I requested a letter through USPS which was suppose to explain WHY my check was declined. This is the response I received (you guessed it, another form letter).

Dear Ms. XXXXX,   This letter is written in response to your inquiry regarding our recent inability to authorize your check. Initially, we want to assure you that we understand the concern this can cause, and we apologize for any inconvenience you may have experienced.   Certegy Check Service (CCS) is a check authorization service. Our clients throughout the United States utilize the service to help reduce losses incurred through retail practice of check acceptance. For many CCS clients we assume liability should an authorized check subsequently be dishonored. CCS maintains a computerized file containing both returned check information and driver’s license or checking account number. In addition to this information, over 40 years of check authorization and resulting loss experiences CCS has developed guidelines for authorizing acceptance of checks. Our system determines the potential risks associated with with checks. Many proprietary factors are evaluated and in making decisions for check approvals. We also track check writing based on many factors, including check sequence number,, check writing activity and check amounts. This process is designed to protect consumers and retailers and to prevent unauthorized individuals from writing checks on otherwise valid accounts. Unfortunately, valid check writing patterns can occasionally overlap with these patterns resulting in out inability to authorize a valid check such as yours.   Regarding our inability to authorize your check, although there were no returned checks on file, the check fell outside of approval guidelines. Unfortunately, we did not have any addtional information at the time to override the concern, and we again sincerely apologize.   In closing, we do appreciate and understand your concerns. Please contact our Customer Care Department at 800-352-5970 if we can be of further assistance.   Sincerely, CERTEGY CHECK SERVICES, INC. Customer Care Department

The check fell outside WHAT approval guidelines? Does this scream discrimination or am I being just plain stupid?

So let’s see—according to Certegy, they use the following methods to decide whether or not Kmart should accept your check:
 

• they keep a “computerized file containing both returned check information and driver’s license or checking account number”
• they’ve used “over 40 years of check authorization and resulting loss experiences” to develop guidelines for authorizing checks
• some proprietary factors!!!
• some sort of pattern matching based on things like “check sequence number, check writing activity and check amounts.”

 
It seems the only factor that could have resulted in your rejection would be something in their “proprietary” bucket. Still, despite all of that fancy-sounding pattern matching and database tracking, they admit to false positives that impact your ability to get a check accepted at a retailer you shop at on a regular basis:
 

• “Regarding our inability to authorize your check, although there were no returned checks on file, the check fell outside of approval guidelines. Unfortunately, we did not have any addtional information at the time to override the concern, and we again sincerely apologize.”

 
It doesn’t sound like discrimination as much as incompetent “proprietary” technology. What’s surprising is how impossible it was for you to get a clear answer—even after following their instructions, you still don’t know why the check was refused and whether it will happen again.
 
Of course, we’re not sure why Kmart would do business with Certegy in the first place, considering the company’s record for lax security:

Certegy Check Services Inc. disclosed last summer that a database administrator had sold the personal and financial information of 8.5 million consumers to data brokers over a five-year period. The check-processing firm didn’t nab the DBA until a retailer reported a link between check transactions and marketing solicitations that some of its customers had received.

That’s right, Certegy didn’t even catch the theft over a five-year period. A retailer did the “pattern matching” and pointed out the connection.
 
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