ChexSystems, like credit bureaus, is considered a Consumer Reporting Agency (CRA) and governed by the Fair Credit Reporting Act (FCRA), which entitles consumers the right to repair their own credit report. A study by the U.S. Public Interest Research Group (USPIRG) found that one in four credit reports contain errors.
The Fair and Accurate Credit Transaction Act of 2003 (FACTA) added new sections to the FRCA, which placed new emphasis on the accuracy of information in consumer reports. Previous to the FACTA, disputes regarding the accuracy of information in a consumer report restricted the consumer to deal only with the CRA. Under new FACTA provisions, a consumer may dispute inaccurate information directly with the information provider (person, company, or organization responsible for submitting consumer information to a CRA).
Under the FACTA amendments to the FRCA, nationwide CRAs are required to provide consumers a free copy of their credit report, upon request, once every 12 months. This includes ChexSystems.
Disputing ChexSystems
Under the FRCA, both the CRA and the information provider (such as the institution responsible for submitting a ChexSystems report) are responsible for correcting inaccurate or incomplete information documented in a consumer’s report. Below are steps for disputing a ChexSystems report.
Step 1
Review a copy of your report. Check it thoroughly for any information which may be inaccurate. If inaccurate information is found, you will need to generate documentation that can substantiate your claim.
Step 2
Inform ChexSystems, in writing, of what information you feel is inaccurate. Include copies of the documentations verifying the credibility of your claim. In addition to your name and address, your letter should clearly, and in detail, itemize each inaccuracy, explaining why you are disputing the information and requesting that it be removed or corrected. You may want to include a copy of your report with the items in question circled or highlighted. ChexSystems contact information and a sample dispute letter are included at the bottom of this article.
Step 3
Send your letter by certified mail, along with a return recipient request. This is important for documenting what ChexSystems received. Copies of your dispute letter and enclosures should also be kept for documentation purposes.
Another way of disputing inaccurate information on your report is to dispute the matter directly with the financial institution that originally provided the information to ChexSystems. The previous steps can be used to mail a dispute to the information provider. Disputes can also be handled by phone, fax, or in person. Which ever way you choose to hand the dispute, be prepared to furnish a detailed explanation as well as any documentation verifying your claim.
ChexSystems Responsibilities
When a dispute is received by ChexSystems, they are required to investigate the items in question within 30-45 days, depending on how you obtained a copy of your report. The only reasons ChexSystems will not investigate a claim is if they consider the dispute to be frivolous. All relevant data provided by you must be forwarded to the financial institution that provided the information. Once the information provider receives notice of a dispute from ChexSystems, it must investigate, review the provided information, and report the results back to ChexSystems. If the disputed information is found to be inaccurate, the information provider must notify ChexSystems of its finding, so they can carry out the consumers request to remove or correct the reported information.
Investigated information can only be added back to your report if the information provider verifies that it is accurate and complete. If ChexSystems claims the information was verified as being inaccurate, and nothing was deleted, then you can send a Procedural Request letter. When the investigation is complete, ChexSystems must provide you with the results, in writing, and a free copy of your report if the dispute results in a change. They must also send you written notice that includes the name, address, and phone number of the information provider.
In the event that ChexSystems does not respond to you within the 30-45 days of receiving your dispute, you can take action by sending a Demand for Removal letter to ChexSystems. No response indicates that confirmation of the information may not have been conducted; therefore, the information must be removed from your report.
If an investigation does not resolve your dispute with ChexSystems, a brief written statement can be added to your report explaining your dispute.
ChexSystems Contact Information
ChexSystems, Inc.
Attn: Consumer Relations
7805 Hudson Road, Suite 100
Woodbury, MN 55125
Phone: 800-428-9623
Fax: 602-659-2197
ChexSystems Sample Dispute Letter
Date
Your Name
Your Address, City, State, Zip Code
Complaint Department
Name of Company
Address
City, State, Zip Code
Dear Sir or Madam:
I am writing to dispute the following information in my file. I have circled the items I dispute on the attached copy of the report I received.
This item (identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.) is (inaccurate or incomplete) because (describe what is inaccurate or incomplete and why). I am requesting that the item be removed (or request another specific change) to correct the information.
Enclosed are copies of (use this sentence if applicable and describe any enclosed documentation, such as payment records, court documents) supporting my position. Please reinvestigate this (these) matter(s) and (delete or correct) the disputed item(s) as soon as possible.
Sincerely,
Your name
Enclosures: (List what you are enclosing.)