Does FACTA Mean I Am Required To Shred My Documents?

By Kathy Perkins
No matter how careful you are with your personal information, it is necessary from time to time to give this information to other various entities: schools, doctors, banks, etc. Do you ever wonder what happens to that information after you give it away? You may be pleased to know that law, specifically the Fair and Accurate Credit and Transaction Act (FACTA) requires the secure destruction of this information.

FACTA applies to every person and business in the United States, and is the closest thing we have to a national document destruction law. FACTA mandates that consumer information must be destroyed before it is disposed of. No particular means of destruction is specified, but the law states that reasonable measures must be taken to prevent unauthorized access to the information. According to FACTA, these reasonable measures include "burning, pulverizing, or shredding of papers containing consumer information" as well as being in "a contract with another party engaged in the business of record destruction to dispose of material, specifically identified as consumer information, in a manner consistent with this rule."

Handling private consumer information is not something to consider lightly. FACTA imposes hefty penalties for violators, including civil and class action lawsuits on both federal and state levels. A violation could potentially cost a company millions of dollars in fines. In a recent example here in Georgia, a company moved out of a building and left behind many documents containing the personal information of others. The property manager discovered these documents and had them shredded. The company is in the process of being investigated and will most likely be fined.

FACTA gives consumers the right to have their personal information protected, and the law places the federal liability and responsibility for this task on businesses. To remain FACTA compliant and avoid fines, lawsuits, and bad publicity, businesses should take precautions to have private information securely destroyed in-house or by a reputable document destruction company.