FACTA is an amendment to which act, and what does it require of financial institutions?

• A. An amendment to the Fair Credit Reporting Act requiring financial institutions and creditors to maintain written identity theft prevention programs.
• B. An amendment to the Privacy Act requiring privacy notices.
• C. A standalone law on data breach disclosure.
• D. A regulatory act about credit scoring algorithms.

Answer: (A)

FACTA expands the Fair Credit Reporting Act. It requires financial institutions and creditors to develop and maintain a written Identity Theft Prevention Program designed to detect, prevent, and mitigate identity theft, including addressing “red flags” of identity theft. The other options misplace FACTA with privacy notices, standalone breach-disclosure laws, or regulations about credit scoring, which are not what FACTA centrally addresses.