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Senate Passes Credit and Debit Card Receipt Clarification Act
www.NACSOnline.com - 05/21/08

WASHINGTON – After last week’s vote in the House of Representatives, the Senate followed suit last night by also passing H.R. 4008 by unanimous consent.

Senator Charles Schumer (D-NY) led the debate in arguing for passage of the bill, the Credit and Debit Receipt Clarification Act, which makes a technical correction to the Fair and Accurate Credit Transaction Act (FACTA) to fix an unintended consequence that has ensnared hundreds of retail companies in unnecessary litigation.

After FACTA was enacted, many retailers reviewed their new obligations under the law and based on the statute and other guidance made every effort to comply by truncating the account number on the receipt given to consumers so that no more than the last five digits appeared. Despite these good faith efforts, some retailers found themselves to be the subject of litigation alleging that the failure to also redact the card’s expiration date was a willful violation of FACTA, subjecting retailers to substantial liability for outrageous statutory damages.

These lawsuits, which make no claim of any harm to any consumer, make a mockery of FACTA by turning a well-intentioned consumer protection into a legal sham. Identity theft prevention experts have testified that the proper truncation of the account number, by itself, regardless of the inclusion of the expiration date, prevents a potential fraudster from perpetrating identity theft of credit card fraud using that receipt. The continued proliferation of these lawsuits is an unnecessary drain against the resources of many retailers during a time of impending financial uncertainty.

NACS aggressively supported quick passage of this common-sense legislation in the both the House and Senate to assist retailers who are current ensnarled in these frivolous lawsuits. We expect President Bush will sign this bill into law quickly.

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