Tax Season Compensation: Is Your Credit Card Number Showing on Receipts?

As you review receipts for the tax season, you may want to watch for receipts that show your debit or credit card number in violation of FACTA.

FACTA Act

The Fair and Accurate Credit Transactions Act (FACTA) is a federal law that works to promote Americans’ credit health. The Act does this in part by giving consumers the legal right to a yearly credit report from each of the credit reporting agencies. It also aids with consumer protection rights.

FACTA was signed into law in 2003 and is an expansion to the Fair Credit Reporting Act, another law meant to protect consumers’ private financial information from being inappropriately shared with third-parties. The laws are enforced by the Federal Trade Commission and the Consumer Financial Protection Bureau (CFPB), and has been in full effect since 2006.

The other part of FACTA is protection of consumers from identity theft. Along with fraud alerts on credit files, FACTA limits the amount of information that can be included on credit card receipts. Under FACTA, electronically printed receipts can print only the last five digits of a credit card number. Additionally, receipts can not contain any credit card expiration date information.

Credit Card Number Violation

In order to comply with the FACTA act, the Federal Trade Commission (FTC) requires businesses to utilize a process called truncation. Truncation is the replacement of important information with symbols such as “*” and “#.”

A properly truncated receipt would look similar to the following:

• ACCT: **** **** ***0 1234
• EXP: ****

This truncated version of the credit card information allows a card to be identified by the cardholder but does not include enough information to reveal sensitive information.

If a receipt shows any credit card digits other than the last five digits, it violates FACTA rules meant to keep consumers safe. The following examples show credit card numbers which do not comply with the federal law:

• 1111 22** **** 4444
• 1111 **** **** 4444
• **** **** ** 444444

Any information regarding a credit card’s expiration date cannot appear on receipts. The following examples are unlawful under FACTA due to the expiration date information shown:

• EXP: 2/20
• EXP: 02/2020
• EXP: 022020
• EXP: 0220
• Expires: 0220
• Exp Date: 02/20
• Exp Date: 02/02/20
• EXPIRY: 02/20
• 02/20
• 0220
• Date 02/**
• **/20
• 2020/02

Not all receipts are required to comply with FACTA. While electronically printed receipts from retailers, restaurants, and kiosks are covered by FACTA, receipts that are imprinted or handwritten are not bound by these regulations and may contain the entire credit card number and expiration date. Consumers who are concerned about credit card information contained on a handwritten or imprinted receipt may want to take steps to dispose of these receipts carefully.

Additionally, customers should be aware that only customer copies of receipts are required to comply with FACTA’s five-digit restrictions. Investopedia discusses how some merchants may need the full credit card information if they have to give a customer a refund or make a chargeback. Having this information on a receipt can help a merchant conduct necessary business.

However, it is a merchant’s job to keep this information secure and ensure that it does not fall into the wrong hands. Under FACTA, merchants are obligated to take steps to protect consumer information.

This means that if you accidentally took the merchant copy of a receipt as opposed to a consumer copy, the merchant may not be accused of a FACTA violation, and will not have violated your privacy.

If you have a receipt printed before 2006 that has all of your information visible, your privacy has not necessary been violated. Though FACTA was passed in 2003, the law gave businesses a three-year grace period in which they could update processes and obtain new technology that would allow them to print only a truncated version of a debit or credit card number on receipts. If you found an old receipt that was printed between 2003 and 2006, the business who issued it may have been in the process of updating their business to comply with FACTA.

Potential Credit Card Fraud

Consumers may be wondering “what’s the point?” If different information is printed on several receipts, this information can be pieced together to create a full profile of a payment card. Perpetrators of identity theft could then use the information to make fraudulent purchases.

In the age of frequent data breaches, perpetrators of credit card fraud can also access this information and much more on the dark web if retailers’ payment databases are compromised and stolen.

Victims whose credit card numbers or expiration dates are stolen from receipts without truncation of digits may be subject to several negative consequences. In addition to the possibility of credit card theft, and fraudulent purchases being made with the card, thieves may also be able to piece together enough information to commit identity theft and take out additional credit cards in the victim’s name. FACTA, however, in addition to limiting the amount of information that may be contained on a receipt, also allows consumers who suspect they are subjects of identity theft to place alerts on their credit history, making it more difficult for thieves to apply for additional lines of credit.

Check Your Receipts This Tax Season

As you prepare your receipts for the tax season, you may want to check that your receipts comply with FACTA. Many households save important receipts for their yearly tax return, making this time ideal for checking any information found on the documents. To double check that your receipts comply with FACTA, simply find the section of the receipt that shows payment card information and check that this information has been properly truncated.

If the receipt complies with FACTA, up to the last five digits of the card are shown and no information about the card’s expiration date is visible. If you have receipts that fail to comply with the federal law, you may be able to speak with an attorney to determine if you are eligible to take legal action and recover compensation.

FACTA Violation Damages

Under FACTA, businesses may be ordered to pay up to $1,000 per violation if they are found to have violated the law. Consumers don’t necessarily need to have experienced identity theft in order to recover compensation under the act; simply experiencing a FACTA violation may be enough to recover compensation from a business.

Investopedia does note that some courts vary on this — some consumers need to prove that they suffer a concrete injury because their information was exposed, while other courts determine that it is enough just that the law was violated for a consumer to seek damages.

Nonetheless, FACTA class action lawsuits have settled in the millions. Companies that have been accused of violating FACTA regulations include Godiva, Bath & Body Works, Victoria’s Secret, J. Crew, IKEA, Rite Aid, Costco, FedEx, and Wendy’s.

If you have gotten a receipt from a retailer with information printed on it that violates FACTA, you may be able to file a lawsuit and pursue compensation. A violation on one receipt likely means the same violation on countless others, so it’s not just your own information you’re protecting by reporting the issue.

Filing a lawsuit can be a daunting prospect, so Top Class Actions has laid the groundwork for you by connecting you with an experienced attorney. Consulting an attorney can help you determine if you have a claim, navigate the complexities of litigation, and maximize your potential compensation.

Join a Free Credit Card Receipt Class Action Lawsuit Investigation

If you have a receipt, invoice or contract from a retailer or vendor that includes more than the last five digits of your credit card or debit card number or any portion of the expiration date, you may qualify to file a credit card receipt class action lawsuit.

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This article is not legal advice. It is presented 
for informational purposes only.