Reason for Decline on Notice of Action Letter

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Question:

If an applicant for an account passes all the BSA and CIP qualifications (ID verification, chexsystems, credit report) to open an account, yet the bank employee has an uneasy feeling or is suspicious of their intentions, are we able to decline the applicant for the account? If not, what options do we have to protect the institution from a loss? If so, what should we provide as the reason for the decline on the notice of action letter?

Answer:

by Randy Carey:

I assume you are referring to a deposit account.

are we able to decline the applicant for the account?

Yes, a bank is under no obligation to open an account for anyone.

If so, what should we provide as the reason for the decline on the notice of action letter?

There is no requirement to provide a notice of action letter on a deposit account.

Answer:

by Jim Bedsole:

...except if the action is taken based on information from a consumer reporting agency, in which case FCRA would require a notice (which the original poster said was not the case in this situation).