The growing trend of shopping and banking online or through mobile phones plays a significant role in the increasing number of identity theft victims each year. Combined with the advancing technology used by cyber criminals to steal consumer information, it is no surprise that nearly 17.6 million Americans suffered from identity theft in 2014, the latest year for which data is available from the Bureau of Justice Statistics. Identity theft continues to be a threat to consumers and their financial lives as it can lead to serious issues with an individual credit report that are a challenge to correct. For that reason, it is important to know the rights and protections you have under federal law as it relates to stolen information.
The Fair and Accurate Credit Transactions Act, also known as FACTA, is an amendment to the Fair Credit and Reporting Act, or FCRA, designed to safeguard individuals from the threat of identity theft. Added in 2003, FACTA provides a number of protections to consumers relating to their specific credit information and how it is used. Here are the main provisions within FACTA aimed to reduce the ramifications of identity theft among consumers.
In an effort to provide protection to consumers who have already experienced identity theft, FACTA imposes fraud alert guidelines for the credit reporting agencies. Under the law, consumers have the right to place an alert on their credit report that establishes an added level of security when seeking new credit. The fraud alert prompts potential new creditors to contact you directly in response to a credit application, and it remains on your credit report for 90 days. Only one credit reporting agency needs to be notified of a fraud alert requestion; the agency is required to report the alert to the remaining two agencies.
Access to Credit Reports
A measure to prevent the damaging effects of identity theft is also included in FACTA. This provision allows every consumer the opportunity to receive a copy of their credit report once per year at no cost. Each of three major credit bureaus – Equifax, Experian, and TransUnion – must make your credit report available once each year upon your request, or you may request your annual credit report here.
The ability to review your credit report in full is an important aspect of staying ahead of identity theft concerns. Your credit report includes information on all credit accounts, current and previous, as well as inquiries made relating to new credit accounts. Should you see information that was not initiated by you or one of your creditors, you can dispute the data through each credit reporting agency in an attempt to correct the issue.
In addition to providing access to credit reports and fraud alert systems, FACTA also gives consumers the power to request the removal of information related to identity theft. When adequate proof is provided, the credit reporting agencies have the power to prevent any data relating to identity theft from appearing on your credit report. This safeguards your credit report and score for new creditors down the line.
FACTA was and remains an important addition to the FCRA. Identity theft has the potential to severely damage your credit report, score, and overall financial reputation, but the provisions and guidelines built into FACTA work to prevent these detrimental consequences. If you’ve been the victim of identity theft or want to stay ahead of cyber criminals, know your rights under federal law and take the recommended action to protect your information.
Edited by Wes