Author Topic: Rights Regarding Chexsystems?  (Read 545 times)

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delandra

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Re: Rights Regarding Chexsystems?
« Reply #15 on: October 06, 2017 03:20:00 PM »
Did you report the unauthorized transaction in the time the law requires? By law, you are responsible for the first $50 of any unauthorized transaction

I reported it immediately.

My understanding of the "first $50" liability thing is that it applies in the case of a lost or stolen card.  In the case of a skimmed card -- or any unauthorized use where the cardholder retains physical possession of the card -- the cardholder is liable for nothing.

The timeline will look <REMOVED> for them if this goes to court.

Monday: Moved all funds out of the account.  Requested account closure.  They refused.  Has to be done via physical paper.
Tuesday: Paper mailed to them, CMRRR.
Wednesday: Unauthorized charge/NSF fee.
Thursday: Paper received.

This would be a non-issue if:

1. They had properly logged my opt-out from their "courtesy pay" service and simply declined the transaction.
2. They had closed the account via e-mail, like nearly every other institution would (is this 1980 or 2017?), when I originally requested it.

The recording of their CSR won't play well for them either.  Ten minutes of blaming me for the charge and asking me why I didn't call the merchant to resolve the dispute.  Uhh, because the charge wasn't authorized and this is so obviously fraud that "Fraud" is the first five hits on Google if you look up the merchant?  Admitting that they'll report to Chex even if the transaction is determined to be fraudulent and putting the onus on me to fix their mistake.....

Yesterday one of their compliance folks called me, unsolicited -- I guess my account got flagged for special handling over my NCUA complaint on another matter -- and assured me this was all taken care of.  The transaction was fraudulent (gee wiz, you mean I didn't purposefully run a $3.68 transaction two days after requesting account closure and transferring out five thousand dollars?!), reversed, and the NSF fees were waived.

As for Chex, she says she can't stop the reporting, which occurs at the end-of-the-month, but she will personally see that the derogatory information is deleted the next business day .  That seems stupid to me, they should be able to stop the initial report, but I'll give her the benefit of the doubt and assume she's acting in good faith.  Will pull my report a week into November; if it's clean we have no problem, if it's not I'm filing that same day.

(Didn't tell her that of course.  I think they're more worried about another NCUA complaint than a lawsuit.)



Admin Note:  Inappropriate language removed.   :tos:
« Last Edit: October 07, 2017 01:51:35 AM by Admin0248 »

BellEbutton

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Re: Rights Regarding Chexsystems?
« Reply #16 on: October 06, 2017 03:44:38 PM »
Why does that matter?

Sorry about that.  I was thinking about CA where Smiley originated.  In any case, the OP referred to FCU which I take to mean "federal credit union".  The ruling in Smiley is based upon the National Bank Act. 

Credit unions are subject to the Federal Credit Union Act.  Are they also subject to the NBA?

kevinmanheim

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Re: Rights Regarding Chexsystems?
« Reply #17 on: October 06, 2017 04:05:45 PM »
Credit unions are subject to the Federal Credit Union Act.  Are they also subject to the NBA?
Credit unions' fees are also considered to be interest.

https://www.ncua.gov/Resources/Documents/LFCU2009-05.pdf

BellEbutton

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Re: Rights Regarding Chexsystems?
« Reply #18 on: October 06, 2017 04:21:39 PM »
Credit unions' fees are also considered to be interest.

https://www.ncua.gov/Resources/Documents/LFCU2009-05.pdf

I saw where it says some fees are considered to be finance charges, but I didn't see anything about them being considered as interest. 

kevinmanheim

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Re: Rights Regarding Chexsystems?
« Reply #19 on: October 06, 2017 07:19:59 PM »
Top of page 3: As a result, most fees charged in connection with an extension of credit are considered finance charges.   

See Reg Z.

BellEbutton

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Re: Rights Regarding Chexsystems?
« Reply #20 on: October 06, 2017 07:33:23 PM »
Top of page 3: As a result, most fees charged in connection with an extension of credit are considered finance charges.   

See Reg Z.

That's what I said I saw.   However, where does it say that finance charges are considered to be interest?

This is from Regulation Z:

(c)Charges excluded from the finance charge.

(3) Charges imposed by a financial institution for paying items that overdraw an account, unless the payment of such items and the imposition of the charge were previously agreed upon in writing.


« Last Edit: October 06, 2017 08:10:06 PM by BellEbutton »

kevinmanheim

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Re: Rights Regarding Chexsystems?
« Reply #21 on: October 06, 2017 09:56:01 PM »
Not sure I follow you.

Finance charges are interest.

The question addressed in the letter is if fees are finance charges.

https://en.wikipedia.org/wiki/Finance_charge

BellEbutton

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Re: Rights Regarding Chexsystems?
« Reply #22 on: October 06, 2017 11:05:50 PM »
Not sure I follow you.

Finance charges are interest.

The question addressed in the letter is if fees are finance charges.

https://en.wikipedia.org/wiki/Finance_charge

You said that finance charges are interest.  I haven't found case law that supports it.

The OP's FCU paid a transaction that overdrew her account.  They charged her for paying that transaction.   Regulation Z says such charges are excluded from finance charges.

(c)Charges excluded from the finance charge.

(3) Charges imposed by a financial institution for paying items that overdraw an account, unless the payment of such items and the imposition of the charge were previously agreed upon in writing.


The charge is excluded by Regulation Z.  Even if it wasn't, I wouldn't go by Wikipedia.

delandra

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Re: Rights Regarding Chexsystems?
« Reply #23 on: October 07, 2017 08:21:48 PM »
Err, apologies to the admin, apparently I dropped a swear word in my post.  Should have proof read better, usually do on this site, please forgive me.....

FWIW, the overdraft letter calls it a fee.  I would post it here but it's a small institution and I do not wish to out myself nor see them alerted if this ends up in the courts.

Flyingifr

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Re: Rights Regarding Chexsystems?
« Reply #24 on: October 15, 2017 08:54:58 PM »
Err, apologies to the admin, apparently I dropped a swear word in my post.  Should have proof read better, usually do on this site, please forgive me.....

FWIW, the overdraft letter calls it a fee.  I would post it here but it's a small institution and I do not wish to out myself nor see them alerted if this ends up in the courts.

It's not a matter of IF.... it's a matter of WHEN. When it appears in Chexsystems, you file suit. Immediately and without further notice. Their verbal promise to remove it the next day is meaningless because if they can remove it the next day they should be able to prevent it in the first place. They were warned, they were on notice. They chose to ignore the warning and the notice, let them pay you $1,000 for the insult. Since they are a small institution maybe that will provide the impetus to correct their systems. If not, you sue them whenever they drop a TL on ANY CRA (and Chexsystems is a CRA) until they either stop dropping TLs on your CRAs or get tired of writing you $1,000 checks or change their systems.
BTW-the Flyingifr Method does work. (quoted from Hannah on Infinite Credit, September 19, 2006)

I think of a telephone as a Debt Collector's crowbar. With such a device it is possible to pry one's mouth open wide enough to allow the insertion of a foot or two.

Debtors Exams are the perfect place for us Senior Citizens to show off our recently acquired Alzheimers.

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fisthardcheese

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Re: Rights Regarding Chexsystems?
« Reply #25 on: October 16, 2017 10:39:12 AM »
It's obvious to me that the card was skimmed -- something that may not have happened if the issuing FCU had chipped cards like virtually everyone else, another reason I dislike them and was leaving -- and that's pretty much fraud by definition.

The Chipped cards are a false sense of security.  They still have a magnetic strip on them which can be skimmed and can be used online or in apps when ID thieves get the card number from the stolen Equifax and TransUnion info they bought (to name a couple sources).

Just last week I had a couple unauthorized charges on my chipped card that is only 3 months old.  I had to, yet again, close down that card and get a new one issued.
11 Arb Settlements (9 AAA, 2 JAMS)
3 JDB Suits Dismissed With Prejudice (2 pro-se, 1 consumer atty)
3 TCPA Settlements (2 pro-se, 1 consumer atty)
2 FCRA Settlements (consumer atty)
1 FDCPA Settlement (w consumer atty)
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1 State UDAP Settlement (ITS)
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CleaningUp

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Re: Rights Regarding Chexsystems?
« Reply #26 on: October 16, 2017 07:56:21 PM »
Perhaps, fist, you should look for new places to shop.

delandra

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Re: Rights Regarding Chexsystems?
« Reply #27 on: October 18, 2017 03:16:33 PM »
The Chipped cards are a false sense of security.  They still have a magnetic strip on them which can be skimmed

Oh, I know that, but I'm thinking it at least cuts down on the number of places where it can be compromised in the first place, assuming they're using EMV terminals.  Once it's compromised you're done, EMV or no EMV. :(

I don't know what the alternative is, for folks who can't use a real credit card for whatever reason.  It's no-big-deal when a credit card is compromised, but a compromised debit card means the possibility of bounced checks/returned bill payments, if your bank isn't on top of their game.  (The FCU under discussion here wasn't, they refused to issue any credits, thankfully I had already moved on and wasn't relying on the account.  My new institution would be more helpful....)

 

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