Telecheck compiles information about consumers and uses it to help merchants decide whether or not to take consumers' checks. Under federal law, the Fair Credit Reporting Act or FCRA, consumers whose checks are denied based on information TeleCheck provided to the merchant have the right to dispute that information and have TeleCheck investigate and correct any inaccuracies. Telecheck is headquartered in Houston, Texas.
Also, if a bankruptcy is filed, Telecheck can be notified and if overdrafted bank accounts were listed in the bankruptcy, those can be shown as being discharged, making it easier for consumers to open bank accounts and pay merchants with personal checks.
The FTC's complaint had alleged that since Telecheck is considered a consumer reporting agency (CRA) or credit bureau, it is subject to the FCRA and it had failed to follow reasonable procedures to maintain maximum possible accuracy of the information about consumers that it provided to it's clients, and also failed to promptly correct errors on consumers' reports.
Telecheck is required by the order settling the case to alter their business practices, and comply with the requirements of the FCRA in the future.
If you have problems with overdrafted bank accounts, these are debts that can be discharged or cancelled in bankruptcy, just like any other unsecured debts. And then Telecheck and similar companies like Chexsystems can be notified, and they are required to then correct their records to show that these debts were discharged in the bankruptcy filing.