The FACT Act prohibits selling or transferring a debt if it is the result of identity theft, unless the consumer is notified within 30 days.

• A. False
• B. True
• C. Only with court approval
• D. Only if the debt is under a threshold

Answer: (A)

When identity theft is involved, the focus is on preventing the victim from being held responsible and ensuring the records are corrected. If a debt is identified as resulting from identity theft, lenders and collectors are expected to halt collection efforts on that debt and treat it as not belonging to the consumer while the matter is investigated. There isn’t a rule that allows selling or transferring such a debt only if the consumer is notified within 30 days; no 30-day window makes or breaks the transfer. The protections aim to remove the fraudulent debt from the consumer’s liability, not to hinge permission on a 30-day notice.