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Consumers seeking to keep their credit card information safe can enjoy a little enforcement power provided by a federal law known as FACTA.
FACTA is the Fair and Accurate Credit Transactions Act of 2003, a set of amendments to the federal Fair Credit Reporting Act passed in response to increasing concerns over the risk of identity theft.
One of FACTA’s many provisions restricts what information may appear on an electronically printed credit card receipt. Businesses are not allowed to print any more than the last five digits of the credit card number on the receipt, and they are also not allowed to print the expiration date. An exception to these requirements exists for receipts written out by hand or printed using the old mechanical imprint method.
Each receipt printed that’s not in FACTA compliance can entitle a plaintiff to at least $100 in statutory damages. If the plaintiff can prove the violation was “willful,” statutory damages increase to $1,000 per violation. A “fee-shifting” provision also provides for reimbursement of attorneys’ fees for a successful plaintiff.
Congress provided for statutory damages in recognition of the difficulty of proving and quantifying harm in cases of identity theft. (A 2008 amendment to FACTA provides that merely printing the expiration date on a receipt that is otherwise in compliance with the Fair Credit Reporting Act does not constitute a “willful” violation.)
When FACTA was enacted in 2003, Congress gave businesses an approximately three-year grace period before this “truncation” requirement went into effect. This gave businesses time to get the news about FACTA and to upgrade their equipment into FACTA compliance.
Once the truncation provision went into effect, many businesses that failed to put their equipment in FACTA compliance found themselves on the receiving end of a FACTA class action lawsuit –businesses like Avis Rent-A-Car, Southwest Airlines, Federal Express, and others.
Businesses, it seems, aren’t too happy about FACTA – and understandably so, given how high the stakes are. The statutory damages provisions apply regardless of the size of the business or the dollar amount of the transactions involved. It’s easy to see that one noncompliant receipt printer could print hundreds or thousands of noncompliant receipts before being discovered, exposing a business to thousands or even millions of dollars worth of FACTA liability.
In fact, FACTA lawsuits filed against big retailers have alleged damage amounts reaching into the billions — $2 billion against StubHub, $3.4 billion against Cost Plus World Market, and a whopping $17 billion against Costco.
Courts spent many years and much work determining what constitutes FACTA violations that are “willful,” since the act leaves that term undefined. A Supreme Court decision from 2007 gave some clarity to the term “willful” but also set the bar fairly low, to the benefit of plaintiffs seeking to prove a willful violation.
In earlier FACTA lawsuits, some defendants claimed ignorance of the truncation requirement. As time goes by and the requirements of FACTA get more publicity, that argument holds progressively less weight, and proving the willfulness of a given FACTA violation becomes more likely.
Free FACTA Class Action Lawsuit Investigation
If you made one or more purchases and the retailer provided you with a receipt that contained more than the last five digits of your credit or debit card number or the expiration date, you may be eligible for a free class action lawsuit investigation and to pursue compensation for these FACTA violations.
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