FACT Act Schedule Setters Urged to Make Adjustments
Paletta, Damian, American Banker
Parts of the Fair and Accurate Credit Transactions Act will not take effect until Dec. 1, but some bankers are saying there still may not be enough time to get ready for the act's long list of requirements.
Last month the Federal Reserve Board and the Federal Trade Commission proposed two deadlines for complying with the new law, which sets requirements for credit granting, the use of consumer data, protection from identity theft, and other matters. New requirements created by the act that do not entail major operational or technological changes by banks or other businesses would take effect March 31; those that do would take effect Dec. 1.
The schedule unsettled some banking groups and banks.
C.R. Cloutier, the chairman of Independent Community Bankers of America, wrote that banks would need more time to comply because the actual implementing rules, which will spell out how to satisfy all the act's requirements, have not even been proposed yet. He suggested that instead of one hard deadline of Dec. 1 for the more complex requirements, the agencies should set "staggered" deadlines to ease the transition.
Patricia N. Grace, a counsel at HSBC Bank USA, asked that the agencies either wait to set deadlines until certain regulations were final, or push the ultimate compliance date later into 2005.
"Establishing an effective date that is unnecessarily premature will jeopardize the ability of financial institutions to properly and effectively make the required changes," she wrote. …