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State Chartered Banks
One of many judgment-related articles: I am not a lawyer, and this article is my opinion based on my experience in California, please consult with a lawyer if you need legal advice.
State-chartered bank accounts do turn up on some bank search reports. Some banks are so small, it is hard to believe. No bank search service is perfect. Perhaps the best at finding small banks/credit unions is www.swift.com.
These days, more than 80% of US banks and credit unions are state-chartered, and there is a large movement underfoot for banks to switch from state charters to national charters, especially those banks having "National" as part of their name.
What is the advantage to being a state-chartered bank, versus being nationally charted? Most banks are examined every 18 months by alternating entities. If it is a state-chartered bank, the two inspection organizations are the FDIC and the respective state's Division of Finance (or some similar sounding entity).
If a bank is nationally chartered, the examination organizations are the OCC (Office of the Comptroller of the Currency) and the FDIC. The word on the street is that federal level bank examiners possess a far more militant approach, whereas state examiners tend to be more helpful to the banks.
The CFPB (www.consumerfinance.gov) is inserting itself more and more, and claiming more examination rights for every bank. The CFPB is making up rules as they go, having already changed the definition of collector in the FDCPA to include first-party collectors (bank employees). The strangest part is that they do not need a law, they do not need a royal signature; they just write a new rule, and that is the way it is.
Years ago, more than 90% of US banks were national members. If someone wanted to open a new checking account, their information (name, SS#, POE/where they worked, cell phone, etc) was put into a computer, and often ChexSystems, or a similar company; would tell banks their recommendation to open the account or not, based on the past reporting of member banks. Today, the percentage of national banks is less than 70%, largely because of the huge volume of income fees generated by checking account holders.
In the old days, all one must have to open a new bank account was a pulse. Now banks must verify your state ID, etc. For banks, the higher charge-off rates are part of the puzzle, however they are easily out-weighed by the banks huge earnings from fees. Banks make lots of money with NSF fees (bounced check fees) alone.
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