Does FACTA go far enough?

According to business executives, the U.S. federal law requiring companies to destroy documents that contain consumer credit information does not go far enough toward fighting identity theft. The Final Disposal Rule, a provision in the federal Fair and Accurate Credit Transaction Act (FACTA) that took effect in June 2005, requires most businesses to destroy documents containing consumer credit information before discarding them.

However, there is no current national requirement to destroy discarded personal information that does not come from a credit report. A recent information-disposal survey from the National Association for Information Destruction (NAID) shows that most executives want that to change. The survey found that nearly 85 percent of executives would support a similar destruction requirement that covers all personal information regarding a consumer.

"FACTA was a great first step in the fight against consumer fraud and identity theft, but we now see that businesses are eager to take the next step," NAID executive director Robert Johnson said in a press release. "Information from credit reports is only a very small piece of the personal information pie that businesses regularly discard and identity thieves crave."

The Better Business Bureau says most identity thieves get their victims' personal information from dumpster diving, not by high-tech sabotage or theft. Federal Trade Commission (FTC) statistics show that as many as 10 million Americans become identity theft victims each year. More than 80 million Americans have had their personal information compromised since February 2005, according to the Privacy Rights Clearinghouse.

An executive summary of the NAID survey's key findings is available at www.naidonline.org.

Edited by Nikki Swartz