Earlier this week we wrote about how BoA told Jesse he could never have an account with them, but they wouldn’t give a specific reason. A lot of readers and tipsters suggested ChexSystems was the culprit, so we asked Jesse if there was something in his credit past causing the problem.
Here’s how ChexSystems works, courtesy of an Assistant Vice President at a “large regional bank” who contacted us:
We have had to close out accounts in the past due to a negative report from ChexSystems which shows that the customer had a charged off account with money owed. To keep using ChexSystems we have to not open accounts that have money owed to other banks. That is usually the only way [for those banks] to collect.
Of course, BoA could have explained everything a lot better. Just because someone has a negative ChexSystems report, it doesn’t mean they are blackballed forever. It’s kind of like bankruptcy, as you come off their records after 7 years.
Although that’s probably why most customers denied a new account at any bank are rejected, it doesn’t sound like it applies to Jesse’s case based on what he told us:
They said it “may have something to do with an unpaid account.” The only problem is that I am young, have good credit, and had never had any account with Bank Of America. Their claim was impossible.
ChexSystems doesn’t care where the old account was—in fact, the whole point of it is to catch people with bad accounts at unrelated banks. But if what Jesse told us was true then we doubt he has an unpaid account with a former bank.
We contacted him and asked him to spill more secrets about his financial history for the benefit of the community. Here’s his response:
I had 2 accounts with a local branch in Massachusetts, the first was a savings account which I closed when I switched over to a checking account.
I waited to close this account until I had received my new one. After receiving my TD Bank card I closed the account with this bank over the phone and they had no issues with me.
I barely ever use checks and have never bounced one.
I have only one credit card, which I got only a few months before applying for BOA. I have yet to be late on a payment.
I have no idea how ChexSystems works, but the only debt I have is from student loans which are actually still in a grace period.
My best guess is that I was denied due to some sort of issue identifying my residential address because I had just moved. Of course that doesn’t explain why they sent me the cards in the first place.
Who knows, maybe it was ChexSystems who caused the problem and not BOA. Still, is it really means to ban a customer for life?
We received so many stories from other readers telling us how BoA screwed up their new accounts that we had to spin them off into another post. After reading those stories, you may begin to feel that Jesse dodged a bullet by having been turned away immediately. At least that way BoA couldn’t charge him overdraft fees, “research” fees, or other penalties without explanation.
Continue reading: “Bank Of America: ‘That’s Why You Don’t Open New Accounts Online’”