U.S. Consumers' Response to FACTA

Date of Original Version



Working Paper

Abstract or Description

In December 2003, Congress passed the Fair and Accurate Credit Transaction Act (FACTA) giving US consumers the right to request free annual credit reports. In compliance with this legislation three major US credit bureaus (Equifax, Experian, and TransUnion) began offering free copies of their credit file disclosures to all consumers. The FACTA initiative, as overseen by the Federal Trade Commission, is significant for several reasons: (1) it mandated private companies to offer some of their products and services for free and (2) it was one of the first and largest initiatives by the federal government aiming to alleviate the rising concerns with identity theft. Despite this goal, to date, no data regarding the public response to FACTA has been provided by the FTC or the credit reporting agencies themselves. This paper presents the results of a nationally representative survey of US consumers’ responses to FACTA. This research also provides the first look at the FACTA initiative as well as the motivations for US consumers to request copies of their credit reports. We discuss the factors impacting consumers’ awareness and usage of FACTA. We also identify the factors leading to the consumer opt-in decision to request free credit reports using FACTA. Such information can help us understand the impact of this legislation.