What are Merchant Laws for Truncating Credit Card Numbers?
In December 2003, Congress passed the federal Fair and Accurate Transaction Act (FACTA), which requires businesses to truncate (shorten) credit card numbers on receipts. This protects customers from identity theft and other credit card crimes by keeping their credit card information confidential.
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How To Truncate
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If the receipts you give to your customers are electronically printed, you must make sure that only the last five numbers of the card appear. The expiration date must not appear at all. On most receipts, the missing information is represented by an asterisk (*) or an X. For example: EXP: ****.
Which Businesses Must Truncate
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When FACTA was passed in 2003, it was written to phase in gradually, giving merchants time to obtain equipment that prints truncated information. That phase-in time is now completed, and all businesses are required to be in compliance. If your company produces electronically generated receipts, the credit card number and expiration date must be truncated. The rules about truncating apply only to the receipts you hand to your customers at the point of sale, and it doesn't include imprinted or handwritten receipts. If you keep copies of the full credit card number in your records, be sure to keep them in a secure place, and discard them safely when you no longer need them.
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Penalties
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Protecting your customers' private information is good business; no company wants to admit that it inadvertently abetted in the identity theft of a customer. But if you fail to comply to FACTA, you may also face tangible consequences. The Federal Trade Commission can impose injunctive relief and civil penalties, costing you money in fines and damages and imposing changes on your business practices.
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