You’ve spent the last hour navigating the grocery store, filling your cart with the items your family needs for the next couple of weeks. Weary, and ready to go home, you make your way to the register to check out.
The cashier scans all your items and shows you the total amount due. You write a check to the grocery store and the cashier puts it through a scanner. Awkwardly, the cashier informs you that your check has been denied even though you know there’s money in your account.
The company recommending the merchant accept or decline your check payment is called Telecheck. Most of us only become aware of Telecheck when we have a check payment denied. So, what is Telecheck? How does it work? How did I get on the Telecheck blacklist? More importantly, how do I get off their blacklist?
What Is Telecheck?
Telecheck is a consumer reporting agency (CRA) that focuses specifically on consumer information related to checks and bank accounts.
Retailers can use Telecheck to determine how risky it is to accept someone’s check, making a decision on the spot whether or not they’ll accept it as payment. If a check is approved by the Telecheck system, the merchant is guaranteed that they’ll get the full amount of the approved check.
This is a service most retailers are happy to pay for when it comes to scrutinizing consumer payments being made by check.
Some banks and other financial institutions use Telecheck when deciding whether or not they should allow a consumer to open a checking account. As we’ve written about elsewhere, these same banks and credit unions use ChexSystems, too. This is done in an effort by financial institutions to reduce fraud and minimize risk as much as possible.
How Does Telecheck Work?
When you present a check at a merchant that uses Telecheck, the information on your check is run through the Telecheck scanning system. Telecheck uses the information to determine how risky it would be for the merchant to accept your check, based on various factors they have used to create a risk measurement model.
The Telecheck system works to determine the chances of the check being fraudulent or written on an account without sufficient funds. If the Telecheck system determines, based on information in their databases and your check writing history, that your check provides minimal risk to the merchant, it will be approved.
Once a check is run through the Telecheck system, the merchant can decide to accept your check or not based on the results. If Telecheck approves a check, they are guaranteeing the merchant will get the money.
What Does It Mean If My Check Is Declined By Telecheck?
If the Telecheck system declines your check, that doesn’t instantly mean that you don’t have money in your account. The system does not have access to information about how much money you have in your account currently.
If your check is declined by the Telecheck system, it could mean they don’t have enough information in their database to say whether or not your check should be verified. It could also mean you have an outstanding debt that’s been entered into the Telecheck system. This debt could be owed to anyone who uses Telecheck and is kept on record for 7 years.
Ultimately, the merchant makes the decision about whether or not they’ll accept your check. Telecheck is simply used as a resource to help the merchant determine how risky it may be to do so. If a check is declined by Telecheck, the merchant can still choose to accept it but is also accepting responsibility if the check bounces or is fraudulent as Telecheck won’t guarantee a check that isn’t approved through their database.
How Can I Dispute Telecheck?
Since Telecheck keeps and sells consumer information, they are considered a consumer reporting agency and are regulated by the Fair Credit Reporting Act (FCRA). You are able to dispute an item in the Telecheck system just like you would dispute an item on your credit report.
If your check is declined by the Telecheck system at a retailer, you should be given a seven-digit record number. You can contact Telecheck directly for more details about that specific instance by providing the record number. Read How to Dispute Telecheck for more information on how to challenge the information in your Telecheck report.
If you’re suspicious there might be an error in the Telecheck database, order a copy of your Telecheck report at the address below. By law, Telecheck must provide your report free of charge once every 12 months if you request it. Carefully examine your report and ask questions about anything that seems a little off or is unfamiliar to you. It’s always better to ask and have it turn out to be something you were aware of than than to not ask and later find out there was an error.
One difference between Telecheck and ChexSystems is that an item is removed from the Telecheck system as soon as it’s paid. ChexSystems may keep an item in their system for up to five years, even after you’ve paid it, unless the bank requests it be removed or you dispute an item successfully.
How Can I Get In Contact With Telecheck?
To get a copy of your Telecheck report, send a letter to:
TeleCheck Services, Inc.
Attention: Consumer Resolutions-FA
P.O. Box 4514
Houston, TX 77210-4514
You’ll need to include information to help TeleCheck confirm your identity::
(1) your daytime phone number
(2) a photocopy of your driver’s license
(3) your social security number
(4) a voided check
Declined Check Information for Check Writers
Returned Check Collection
Call to get your Free Annual File Disclosure pursuant to the Fair Credit Reporting Act
Fraud, Identity Theft, Forgery
TeleCheck Services, Inc.
Houston, Texas 77056