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 More and more business owners are
purchasing document shredders then ever before.
Why?... Identity theft for starters.
A new law is going into effect in the summer of 2005 which
states that if you employ anyone for any reason and have
personal information on file regarding that individual for
Social Security taxes, credit references, etc., you will
have to destroy that information on any document before
you toss it into the trash.
The law requires you to destroy all paper or computer
disks containing personal information which has been
derived from a consumer report before it may be discarded.
FACTA (Fair and Accurate Credit Transactions Act) came
into being when signed by President Bush on December 4,
2003.
Some of what FACTA allows:
* One free credit report per year per consumer at www.annualcreditreport.com
or by calling 877-322-8228. This went into effect across
the country on September 1, 2003.
* All electronically printed credit card receipts must
show only the last five digits of a credit card number.
This went into effect in December 2003.
*All information collected from a consumer credit report
must be destroyed by an employer prior to discarding it.
This will become effective June 1, 2005.
*Anyone suspecting identity theft needs to notify only one
of three credit-reporting companies in order to set off a
nationwide fraud alert. This is effective now.
*Whether your loan is approved or not, mortgage companies
have to provide the credit score they used to determine
the loans interest rate. This is effective now.
Identity theft has become a huge
problem and it is hitting corporate America hard.
Approximately 7 million people had their identities stolen
in 2003.
The cost to reinstate their credit averaged about $1,495
each with approximately 600 hours of time invested to
straighten out his/her finances.
For the destruction of documents, shredders are becoming
one of the most popular purchases by home owners as well.
How many of us have gone through the hassle of tearing up
bank statements or other personal documents into little
pieces and tossing them down the toilet? Perhaps you have
opted to burn these documents in an effort to safeguard
your identity. What ever methods you have used, shredding
is an easier, effective means to accomplish this goal.
What could happen if you don't shred your employee data
before discarding it and some of your employee data falls
into the wrong hands?
- You could be sued by an employee for actual damages. Or
you could be liable for statutory damages of up to $1,000
per employee.
- In the event that a large number of employee’s
identities have been affected, a class action lawsuit
could be launched resulting in you, the employer having to
pay punitive damages.
- U.S. Government fines of up to $2,500 per violation.
- State Fines -up to $1,000 per violation.
So... doesn't it make sense to purchase a shredder and
adhere to the requirements of this new law?
The best type of shredder to purchase - one that cross
cuts. This type of shredder really destroys a document.
Just try piecing one together after it has been through
one of these devices.
Identity theft is a growing problem. Don't let your
company or household become another statistic.
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