What does the FACTA Disposal Rule require?

• A. The requirement to properly dispose of records containing consumer information to prevent identity theft
• B. Requirement to dispose of all electronic devices after 1 year
• C. Prohibition on sharing consumer data with affiliates
• D. Requirement to shred only paper documents

Answer: (D)

The main point is that the FACTA Disposal Rule requires secure, proper disposal of records that contain consumer information so that identity theft is prevented. It isn’t limited to paper; it covers both physical records and electronic data, as well as the media that store them. The idea is to render the information unreadable or unreconstructible, so methods like shredding, burning, pulverizing paper, and wiping or degaussing electronic media (hard drives, backups, digital files) are used before disposal or reuse.

That’s why focusing on secure disposal rather than a fixed timeline for disposing devices or on sharing data with affiliates is the key. Simply shredding paper documents isn’t enough on its own if electronic records or storage media are not disposed of securely.