After Bankruptcy, What Should I Now Do With ChexSystems, Inc.?

Consumers frequently receive a discharge in Bankruptcy, only to find that they still can not open a bank account due to check reporting companies such as Chex Systems. IF you have questions about this contact Litigo.

Companies like this are considered consumer-reporting agencies, and similar to Equifax, Experian, and TransUnion. Nevertheless, they only provide deposit account services such as the reporting of bounced checks or outstanding balances owed to banks or other financial institutions. Litigo can help you solve these issues.

Such information is meant to help the banks and institutions in identifying account applicants who may have a history of account mishandling (for example, people whose accounts were overdrawn and then closed by their bank). Contact Litigo for help.

Litigo Inc. is not owned, operated, or affiliated in any way with Chex Systems Inc. or its parent Fidelity National Information Services (also known as FIS). Litigo cannot remove, update, or verify a consumer’s file in the CHEXSYSTEMS database, which is owned and operated by Chex Systems, Inc. Litigo can assist you in filing a dispute against the negative information that banks have reported to Chex Systems. Contact Litigo for assistance 1(877) 432-4818.

Nevertheless, these entities, just like the Credit Bureaus, are still governed by the Fair Credit Reporting Act (FCRA) and other laws. Accordingly, Chex Systems can therefore still be sued under the FCRA for improper reporting. For example, if Chex Systems fails to follow the dispute mechanism procedures on a disputed trade item in its report, it can be sued in Federal Court.  Lets take Chex Systems by way of example:

As a matter of practice, each report submitted to Chex Systems remains for five to seven years. After Bankruptcy, Chex Systems is not required to remove an accurate report previously submitted. Nevertheless, the reporting banks or institutions are obligated to update their reports with accurate information.
1) You must first order your free copy of the Chex Systems report. Under the Fair and Accurate Credit Transaction Act (FACTA) amendments to the Fair Credit Reporting Act (FCRA), you are entitled to a free copy of your consumer report, at your request, once every 12-months. You can request that report at consumerdebit.com. You can also contact an agent at Litigo for assistance.

2) Once you obtain your report, you must then review the report for accuracy. Any accounts reporting a balance that were discharged need to be corrected. These accounts should be reported as “$0.00 balance, discharged in bankruptcy.” If you are not sure how to correct this contact Litigo.

3) Dispute the trade item. Disputing an account trade item is relatively easy. Simply send Chex Systems a copy of the free report you received with the improper information circled or flagged, your discharge notice you received from the Bankruptcy Court, “D, E, and F” of your Bankruptcy Schedules, and a letter explaining why the trade item is no longer accurate since the new balance is now “$0.00 after being discharged in Bankruptcy.” Also be sure to provide your complete identification, including your driver’s license number and social security number. You should also cc the correspondence to the offending bank. Contact Litigo for help.

4)  Under the FCRA, Chex Systems then has 30 days to investigate the dispute. If it fails to investigate and respond, then the item must be deleted. By law, during this 30 day time frame, Chex Systems then contacts the reporting member to verify if the account is now a $0.00 balance and discharged in bankruptcy.

5) If the bank responds back that the account was not discharged in bankruptcy, or continues to report a balance, then both the bank and Chex Systems are liable under the FCRA for false reporting. Such liability would then entitle a debtor to actual damages, statutory damages, attorney fees, and costs. By law, Chex Systems is required to provide this “dispute statement” with all Chex System inquiries it receives. If you are not sure about the information you have received contact litigo for help.

Typically, Chex Systems and the bank will follow the laws. In most cases, the previously reported debt will be updated to reflect a $0.00 balance and that the debt was discharged in bankruptcy. But this does not mean that your name has been taken out of the Chexsystems database.

If you have followed the above steps and are still being reported as having a NSF balance without bankruptcy notation, you should immediately seek a competent attorney in your area to pursue your rights under the FCRA and other applicable laws. Be sure to provide your attorney of the first report, the dispute letters, and the final report showing the false information remains. Don’t wait 7 years to get a bank account contact Litigo today to get help.

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