Congress passed the Fair and Accurate Credit Transactions Act in 2003 in an effort to prevent identity theft, among other purposes. The statute provides that consumers may request that the credit bureaus place fraud alerts on their accounts. The act also specifies that only the last five digits of a credit card number may appear on an electronically printed receipt. Moreover, this statute directs the FTC to prepare a model summary of the rights of consumers with respect to procedures to remedy fraud or identity theft.
There are two separate sections of the Act which require select entities to create policies and procedures to help assist with identity theft issues. The first section of the Act addresses procedures users must implement in the case of information discrepancy, such as in hiring procedures and background checks, and the second section of the Act places rules and regulations on financial institutions and creditors. The second portion of the regulation, 16 CFR 681.2 and FACT Act Section 114, applies primarily to financial institutions and those with “covered accounts.” Creditors and financial institutions as defined by the act must periodically determine whether it offers or maintains covered accounts, and if so they must develop and mplement a written identity theft program.