Tips on the FACT Act

Posted on November 30, 2007

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On December 4, 2003, the Fair and Accurate Credit Transactions Act of 2003 (FACT Act) was enacted. At that time, few would have predicted that the FACT Act would prompt a mass filing of complaints against retailers and businesses in 2007. For instance, this week the Birmingham News reported that lawsuits have been recently filed in Birmingham’s federal court claiming that popular restaurants, a movie theater chain and a ticket ordering service have violated the FACT Act by failing to preparly truncate their receipts. Attorneys are seeking class-action status, damages and fees.

One unique provision of the FACT Act contains serious consequences for retailers, merchants and any other individual or business that accepts credit cards or debit cards from its customers. It requires the business to truncate electronically processed credit card receipts to include no more than the last five digits of the card number, and to delete the expiration date. The law applies only to electronically printed receipts, not to handwritten or imprinted ones, and it applies to the receipts the customer is given, not to the receipts the businesses retain for their own records. The act provides from $100 to $1,000 for each violation.   

According to the FTC, credit card numbers and expiration dates on sales receipts provide helpful information for scammers trying to commit identity theft. Congress passed the Fair and Accurate Credit Transaction Act to minimize the amount of personal identifying information on credit receipts, because they can be lost or thrown away to be retrieved by would-be identity thieves. The law was phased in so that merchants with newer electronic card-processing machines had to comply with its provisions as early as 2004, and those with older machines by December 2006. All merchants that electronically print credit or debit card receipts must now truncate the information on the copy they give consumers.

Brice Johnston, Goodrich Law Firm, LLC

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