Credit reports, FICO scores, ChexSystems, TeleCheck…one thing’s for sure: financial institutions have all sorts of ways of keeping tabs on you. And although many of these might be familiar to you, there’s another one that should be on your radar.

It’s called Early Warning Services, and it’s a consumer reporting agency similar to a credit bureau like Experian. However, instead of focusing on your credit history and debt totals, this one is all about your banking history. Read on to learn everything you need to know about Early Warning Services, and what to do if you find an error on your EWS report.

What is Early Warning Services (EWS)?

Like the credit bureaus, Early Warning Services is a consumer reporting agency that’s meant to help banks and get insight into your monetary situation. Specifically, EWS is focused on finding and reporting fraudulent activity associated with your checking and savings accounts.

While ChexSystems and TeleCheck report on banking mismanagement, such as overdrafting or bouncing checks, EWS is more concerned with bank fraud, forgery, counterfeit checks, check alteration, and check kiting.

EWS was created more than 25 years ago as a joint effort by several major banking institutions, including Bank of America, Capital One, Chase, and Wells Fargo. Today, its network includes about 2,500 financial institutions, government entities, and payment companies. That means that when you apply for a bank account, the bank may pull your EWS report and may deny your application if it finds negative EWS items.

What’s in Your Early Warning Services Report?

Just as the credit bureaus put together a credit report using your information, EWS creates a consumer report for consumers in the banking system. Here’s the information that a financial institution can see on your EWS record:

  • Personal information, such as your name, date of birth, social security number, and contact information
  • Account information, including checking and savings account history and activity, your bank’s name(s), your account number(s), opening and closing dates of account(s), balance and status information, transactions, and more
  • Inquiries that have been made by entities wishing to see your Early Warning Services report

Early Warning Services does not create a credit score, but it does provide a “deposit score,” which uses your historical banking and deposit information to estimate your risk level for opening new accounts.

You can request your report and deposit score by calling the agency directly at (800) 325-7775 during regular business hours (MST), or by downloading and filling out its consumer identification form and returning it to the agency by mail.

Know Your Rights: Consumer Protection Under the FCRA

Early Warning Services is regulated and limited by federal laws put in place to protect consumers. Specifically, it’s subject to the Fair Credit Reporting Act, or FCRA, which states you must be able to request a free copy of any financial consumer reports on an annual basis.

This includes your EWS report. Furthermore, if your rights under FCRA are violated, you’re entitled to recover actual and/or statutory damages, attorney’s fees, court costs, and punitive damages, though there are statutes of limitation surrounding the amount of time you have to file suit.

Disputing an Item on Your EWS Report

If you request a copy of your report and find a fraudulent item, you have a right to dispute that information and have it removed from your report. After receiving your report as outlined above, review it thoroughly for inaccuracies; common problems include incorrect personal information or amounts owed.

If you do find errors, you’ll want to dispute them directly with the bank as well as with Early Warning Services itself. You’ll need to gather the following details to proceed with the dispute:

  • Your Consumer ID Number, which can be found on your report
  • A description of the item or items you’re disputing, including all pertinent details such as account numbers, exact dollar amounts, etc.
  • A detailed explanation of what, exactly, you’re disputing, i.e. an incorrect dollar amount on an account owed. Explain both how and why the item is incorrect.
  • Copies of any supporting documents or other pieces of evidence you might have.

You’ll want a separate dispute sheet for each erroneous item you find, and they’ll all need to be signed and submitted to all involved banks. Finally, if your dispute is refused, you have a right to provide a rebuttal statement, which EWS is obligated to add to your file.

Second-Chance Bank Accounts

Just like having a negative ChexSystems or TeleCheck history, having a negative item on your EWS record can make it more difficult to open a bank account. However, there are banks and credit unions that offer bank accounts to those with imperfect consumer report histories. This is known as second chance banking, and it can help you get back on your feet when you’ve undergone a recent monetary emergency.

Keep in mind that a second-chance account may come with additional fees and charges you wouldn’t see with a traditional account, and are only offered by certain banks and institutions. Although your new account may come with some restrictions, it’s a good way to get back into the game and start building up a positive consumer and banking history. Plus, it may allow you to leverage positive activity for a regular checking account after a given period of time (usually about six months or a year).

How to Open a New Bank Account with a Bad EWS Report

One of our favorite second-chance banks is BBVA, an institution that understands that some consumers need a fresh start. Their Free Checking account is available to those with EWS records. It has no monthly fees and you’ll only need a $25 initial deposit to get started. Online accounts are available to residents across America, and the bank has physical branches in the following states:

  • Alabama
  • Arizona
  • California
  • Colorado
  • Florida
  • New Mexico
  • Texas

Your account will come with a free VISA debit card as well as a suite of high-tech mobile banking capabilities, which puts the financial reins back in your hands once and for all.

A negative banking history is no reason to throw in the financial towel. By taking steps to repair your history and build positive account activity, you’ll soon be able to obtain the financial products you want and the freedom they afford.