What is the FACT Act?

The Fair and Accurate Credit Transactions Act of 2003, also known as the FACT Act, became effective on December 1, 2004. The crime of identity theft has been called the fastest growing crime in America. The new provisions will help consumers deal more effectively with identity theft and place more safeguarding requirements on financial institutions.

What will change and how will it help protect our members?

• Everyone can receive free annual credit reports from the three major credit bureaus - Experian, Equifax and Transunion. This is to encourage the public to check their credit report for potential fraud. Consumers will also be able to receive free credit reports other than annually, if they are unemployed, receive public welfare assistance or believe that their file contains inaccurate information related to fraud or identity theft.



• A consumer may now go directly to the financial institution to dispute inaccurate credit information. No negative information can be reported while the investigation is pending. Click here to submit a credit dispute.



• Fraud Alerts & Active Duty Alerts – if a person is a victim of identity theft, he/she will have the right to flag their account by placing a fraud alert. If a person is on active duty military, he/she will have the right to place an active duty alert. When either of these alerts is placed on a credit report, any business that extends credit must first contact the consumer at a number designated by the consumer or take other reasonable steps to ensure that the application was not made by an identity thief.



• Credit reporting agencies will have to give identity theft victims a notice of their rights, which includes 1) right to file a fraud alert, 2) right to block information in a report that resulted from fraud and 3) right to obtain copies and documents that were used to commit the fraud.



• Consumers will have the right to request their credit scores including an explanation of the factors that went into computing the score. Credit reporting agencies are allowed to charge a reasonable fee for credit scores.



• Consumers may annually request free reports from specialty consumer reporting agencies. These are companies that issue noncredit reports for reasons such as employment history, check writing history, residential or tenant history, medical records or payments and insurance claims.



• Consumers must be notified when negative information concerning an account is reported to credit agencies within 30 days of being submitted.



• Credit and debit card receipts may not include more than the last five digits of the number or the expiration date.



• Consumer reporting agencies and all businesses that use credit reports must have proper disposal practices in place that will maintain confidentiality.



• Identity theft victims will be able to obtain copies of the imposter’s account application and transactions from the business that provides credit to an identity thief. The consumer must request for information in writing, show proof of identity, a police report, and an identity theft affidavit.



• Members who apply for any real estate loans (purchases, refinancing, HELOC’s, 2nd mortgages, etc) will need to be given notice when their credit score is used to make a decision.



• Collection Agencies must inform creditors when a consumer is a victim of identity theft. Creditors will not be allowed to sell the debt or place it for collection. In addition, victims of identity theft will be entitled to receive all information about the debt.



• Consumer reporting agencies may not report the name, address, and telephone number of any medical creditor unless the information is provided in codes that do not identify or infer the provider of care or the individual’s medical condition. A creditor may not obtain or use medical information to make credit decisions.



• Employers do not have to get permission to conduct a misconduct investigation on an employee as long as the employer is using an outside company to do the investigation.