FACTA Provisions That Protect Consumers From Identity Theft

FACTA stands for The Fair and Accurate Credit Transactions Act. This is an amendment to the Fair Credit Reporting Act and was enacted on Dec 4, 2003.This act enables consumers to request a free copy of their credit report once a year from the three major credit reporting bureaus (Equifax, TransUnion and Experian).

Prior to this legislation, consumers could only obtain copies of their credit reports if credit had been a factor in being denied employment, insurance coverage, turned down for a lease, or other credit.

In addition, FACTA law provides some protections against identity theft, and other tools that expand access to credit, and address the accuracy of consumer financial information. By having more frequent access to one's credit records, consumers can better monitor their credit files for questionable or unauthorized activity, including identity theft.

For instance, if identity theft is suspected, consumers have the ability to place fraud alerts on their credit files, making fraudulant application for credit more difficult. Military personnel who are deploying overseas can also place these alerts on their files.

FACTA was also enacted to combat discriminatory lending practices, and ensure that lenders make fair loan decisions, based on one's accurate credit history.

Some other FACTA law provisions:

• More secure disposal of consumer information

• Credit and debt card number trancation. Businesses are prohibited from printing more than 5 digits of a customer's credit/debit card number or expiration date on any receipt at the point of sale or transaction; handwritten receipts are excepted. This will greatly reduce the amount of "left behind" slips of paper with credit card and other useful information to identity thieves.

• More proactive measures and guidelines required by credit grantors and credit agencies to be aware of common patterns of identity theft. These actions can prevent major damage from occurring.

• Implementation of a nationwide fraud alert and detection to be placed on a consumer's file. Consumers need place only one phone call to one credit bureau. Information is then shared with the other two credit bureaus, as well as any credit card companies. In the past, consumers suspecting fraudulent activity would have to call all three credit bureaus, as well as all credit card companies individually.

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