Why would a Credit Union repeatedly SP Chexsystems?

[kiwigirl]

Hi There!

   I understand why credit unions would HP Chexsystems if you are applying for membership, new accounts etc, but I have noticed that one of my credit unions is doing soft pulls ('only viewable by you') every few days.. I am wondering 'why'?

   Now.. the truth is that over the past few months I have opened over 10 new checking accounts at different CU's.. honestly with no intention of churning but instead collecting for a few different reasons such as 95/100% home equity providers, good CC's etc and some simply for aesthetic reasons like I really love their card design..  Full disclosure.. this particular CU did initially flag me in their own systems (not Chex) because of a misunderstanding which was cleared up. So it's possible the SP's in Chex are due diligence, but I am not entirely sure whether they would just be looking for Chex derogatories (which of course I have none) OR excessive inquiries..  I have for now paused opening any new accounts so there won't be any new Chex inquiries for several months at least.. but I am just curious if anyone has experience where a Credit Union does end up closing your accounts because they notice you opening others at other institutions? I know I could also freeze my Chexsystems report but I am not doing anything wrong/fraudulent and thinking it is better to let them keep snooping my report especially as I have also paused the inquiries now? 

[coldfusion]

Having a freeze in place makes it a lot more difficult to open a new account in your name which makes it a useful anti-fraud measure or as a minor deterrent against acting on impulses to apply for new accounts but it doesn't necessarily prevent a bank or credit union with whom you already have an account from soft pulls if they're being done for the purpose of reviewing your current status.

10 new accounts in a space of several months isn't unheard especially if you're chasing new account bonuses but is unusual and you've  gotten yourself onto their radar as being at what they see as a higher risk of being up to something they don't like so they're just keeping tabs on you.  If you let the dust settle they'll eventually back off.

[kiwigirl]

Thankyou! That makes me feel better and I will just ignore it then..

[GZG]

I've had a couple of banks (5/3rd)/cu's do this and it stops after awhile, I imagine they are all using the same risk suite tool thing that triggers monitoring of a file after a certain behavior or velocity or score or something

as stated above, freezing is not going to stop them, they have access to your report as you are a client of theirs and if they want to pay chex for reports, they are going to continue getting your report

unless you're doing fraud or plan to have a derogatory report, I wouldn't alter your behavior in any way, just continue doing what you're doing and if that leads to AA from them on an already opened account (which would be astronomically rare outside of actual derogatories or them deciding shortly after account opening they don't want you to have an account) so be it. 

if you care to share, you can say which CU is doing it, if they are a very strict chex CU, it might make sense, but I don't think anything will come of it. 

[Realist]

Inquiries don't appear to be an issue so much.  I've had a few with a solid Chexsystem score.

Even if you were churning, I'd recommend keeping it manageable.  Some accounts are local that I keep open, and use for specific purposes.  Yes, they give the bonus, but it doesn't appear that I'm closing out accounts for that specific purpose.  Others are the bonus, but after they serve a purpose, I close them out here and there.  When there is no maint fees, this helps as you can keep them open indefinately and cut them loose at random.   Now in the case of churning, you may want to close them  out to reset the timer on the next churn.

At the end of my day, working at this for some time, we have dozens of credit cards, and a dozen bank/credit union accounts.  Churning and welcome rewards are the icing on the cake.  If they suddenly discontinued any of this, we'd still be miles ahead as financially viable.

[kiwigirl]

Thanks!

Actually I looked more closely and realized there is/was a specific pattern to their SP's.

Specifically, the SP happen exactly a day after a new Chex inquiry for another institution appears..

i.e I attempted to open a new savings/checking account at a different credit union and they did a HP on Chexsystems.

Then like clockwork, a day later this Credit Union will do a SP.

I really don't want to name the CU mainly because I fought for over a month to get them to rescind closing my accounts because

of perceived fraud risk (mainly over setting up new external transfer destinations), and I was really grateful they listened to me in the end and they actually did reverse their actions. I actually really like the CU and want to keep them which is why I battled hard to get my accounts back! I will say this CU is not small (> 2Billion Assets)  and maybe there are some CU's that are more paranoid than others?

Anyway thankyou so much.. I'm just going to take a break from new accounts for a little while.. I already started getting rejections because of my flurry of new accounts.. so I plan to do nothing much for about the next 6 months and then revisit picking up some new memberships then!!