Chances are that if you’re a business operating in today’s world, your average customer no longer pays with cash, but instead uses a credit or debit card. This means that on any given day you are using some sort of terminal to print receipts for your customers. More than likely, those receipts are briefly reviewed by the customer (or in some cases not at all) and tossed in the trash. Are you aware that your business may be printing more information than is allowed under both Federal and Illinois law? Could your business be putting its customers’ personal financial information at risk, and thus in turn putting itself at risk of a potentially crippling law suit?

Every business that prints a paper receipt is required to omit and truncate certain information from the receipt. According to Federal law, The Fair and Accurate Credit Transaction Act of 2003 (“FACTA”), receipts for debit and credit card purchases cannot display more than the last five (5) digits of a cardholder’s account number.[1] However, Illinois law limits the information printed on receipts even further. According to the Illinois Consumer Fraud and Deceptive Business Practice Act, no provider may print more than the last four (4) digits of a cardholder’s account number.[2] Additionally, the Illinois Consumer Fraud Act prohibits the printing of the credit or debit card expiration date.

Under Federal law, any person that negligently violates the truncation requirements is liable for actual damages, as well as attorneys’ fees. In the case of a willful violation, the Act provides for recovery of statutory damages of not less than $100 but no more than $1,000 per violation, as well as punitive damages and attorneys’ fees.

In Safeco Insurance Company of America v. Burr, the Supreme Court held that “willful” noncompliance under FACTA encompasses both knowing and reckless behavior.[3] In so doing, the Court noted that common law has generally understood recklessness to be conduct that entails “an unjustifiably high risk of harm . . . known or so obvious that it should be known.” Thus a company acts in reckless disregard of FACTA when their conduct involves something more than negligence, but the conduct need not rise to the level of an intentional act. Illinois courts have found that a company’s negligence does not establish recklessness. Aliano v. Joe Caputo & Sons – Algonquin, Inc., 2011 WL 1706061

While FACTA provides for both actual and statutory damages, the Illinois Consumer Fraud Act provides that only those individuals who have suffered actual damages as a result of a violation can bring an action under the Act. [4]

Thus, as the holiday season heats up, prudent Illinois business owners will do well to inspect their point of sale terminals to ensure that the receipts they are producing are in compliance with both Federal and Illinois law. This simple step will go a long way towards ensuring that the holidays are not ruined by an expensive and unnecessary lawsuit.

[1] 15 U.S.C. §1681o(a).

[2] 815 ILCS 505/2nn(b).

[3] Safeco Insurance Company of America v. Burr, 551 U.S. 47, 68-70 (2007).

[4] 815 ILCS 505/10a

 – Beermann Business Law Group