Two U.S. Laws that Protect You from Identity Theft

Identity theft is running rampant in this country and around the globe as criminals continue to come up with new ways to defraud you. The American legal system is doing what it can to curtail the widespread crime. Here, we discuss two federal laws: The first offers rights to fraud victims and potential victims, while the second doles out harsher punishments to criminals.

Fair and Accurate Credit Transactions Act (FACTA)

FACTA was passed in 2003. It offers all Americans, victims and potential victims, several lines of defense:

Free Credit Reports and Fraud Alerts

The act entitles you to a free credit report once a year from each of the three major credit bureaus -- Experian, TransUnion, and Equifax. You’re also allowed to put a fraud alert on your credit file so that lenders have to contact you before opening new accounts in your name. Plus, if you’re on active duty in the military (which makes you a prime target for identity thieves) you can add this notation to your file as well.

Businesses Must Keep Your Information Private

Remember the days when you had your entire credit card number and expiration date on every receipt that fell out of your wallet? Thankfully, things have changed to better protect your privacy. The act requires businesses to truncate the numbers. It also requires businesses that deal with sensitive information to create policies on how to handle the risk of identity theft. They must look for “red flags,” such as address discrepancies or new charge card requests that are out of the ordinary. They’re also required to dispose of records responsibly so they don’t get in the wrong hands.

Victim Assistance

Finally, the law offers help to those who have already been victimized. It allows people with proof of identity theft, and proof that they are who they say they are, to get copies of the documents the thieves used to create false accounts. They can also block fraudulent information from their credit reports and get details on all debts being sent to collections agencies so they know if they’re valid or not. Organizations are not allowed to sell debts that are suspected to be due to identity theft.

Identity Theft Penalty Enhancement Act

While this law doesn’t directly protect you if you’re a victim of identity theft, it does deter new theft by extracting harsher punishments from criminals. The law, signed in 2004, effectively introduced the crimes known as aggravated identity theft and terrorism-related identity theft.

Aggravated identity theft occurs when the theft is used to commit another crime, such as buying stolen property or creating false identification. Terrorism-related theft is pretty self explanatory. It’s basically aggravated theft that involves a terrorist crime.

According to the law, thieves can get up to five years in prison for traditional identity theft, at least two years for aggravated identity theft, and at least five years for terrorism-related identity theft. They can also be punished further for additional aspects of their crimes.

There are additional state identity theft laws that sentence criminals based on the state where the crime occurred, how much money was involved, and other factors. This makes it very important to report identity theft with the utmost care and detail. Plus, you’ll want to keep track of exactly how much cash the thief cost you and how much time it takes you to make things right. It is completely within your rights to sue for damages in civil court.