FACTA Puts Credit Card Fraud Protection in Consumers’ Hands

To protect individuals from identity theft and credit card fraud, many different legal requirements are in place at both the federal and state levels.

Health care providers, for example, are expected to keep patients’ medical records confidential in accordance with the Health Insurance Portability and Accountability Act.

Similarly, the federal government must handle personal information – such as applications for Social Security insurance or veterans’ benefits – in accordance with the Privacy Act of 1974.

Businesses that handle consumer credit card information are also subject to legal requirements designed to prevent credit card fraud and to help consumers deal with fraud if it happens.

Many of the current requirements were enacted together in the Fair and Accurate Credit Transactions Act, or FACTA. FACTA was enacted in 2003 as a set of amendments to the Fair Credit Reporting Act.

Consumer Protections Under FACTA

FACTA provides many protections against credit card fraud that consumers may already be familiar with.

One provision of FACTA entitles consumers to get one free copy of their credit report per year from each of the three major reporting bureaus – Equifax, Experian and TransUnion.

Having access to these reports allows consumers to keep an eye on what’s going on with their credit records and spot possible fraud before it becomes an even bigger problem.

Consumers who may suspect they are or could soon be victims of fraud have the option of placing a fraud alert on their credit record.

FACTA also established what’s known as the Red Flags Rule. Though a joint effort among several administrative agencies, regulations are now in place that govern how financial institutions and creditors must respond when they find indications in a consumer’s credit history of possible fraud.

Using FACTA’s Truncation Requirement to Fight Credit Card Fraud

FACTA puts one of its most powerful protections directly into consumers’ hands.

With uncountable numbers of credit card transactions going on every day, massive amounts of credit card information are constantly changing hands.

FACTA creates specific responsibilities for businesses that handle that information. When those responsibilities are breached, affected consumers may bring a FACTA lawsuit.

Under what’s known as FACTA’s truncation requirement, businesses that give customers electronically-printed credit or debit card receipts may not print the card’s expiration date or any more than the last five digits of the card number on the receipt.

The truncation requirement was designed so that credit card receipts would provide the information that consumers and businesses need without providing enough card information to put the consumer at risk for credit card fraud.

FACTA puts the power to enforce the truncation requirement in the affected consumer’s hands. Consumers who receive a noncompliant receipt can bring a civil FACTA lawsuit to recover damages from the merchant that issued the receipt.

If the consumer can show that the merchant’s FACTA violation was knowing or willful, they may be able to recover statutory damages of $100 to $1,000 per violation. These statutory damages can multiply to an astronomical level in a successful FACTA class action lawsuit.

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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