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Which law was violated by the processing company when loan files for applicants who were not approved were disposed of in a dumpster?
FACTA
HMDA
TILA
RESPA
The correct answer is: FACTA
The correct choice, regarding the violation of law due to the improper disposal of loan files for applicants who were not approved in a dumpster, is FACTA, which stands for the Fair and Accurate Credit Transactions Act. This act is specifically designed to protect consumer information and ensure that sensitive data, particularly information related to credit and finance, is handled securely. Under FACTA, businesses are required to take reasonable measures to dispose of consumer information in a way that protects against unauthorized access or use of this data. Simply throwing sensitive information related to loan applicants into a dumpster without proper shredding or securing it constitutes a violation of this law, as it fails to safeguard personal data from potential identity theft and abuse. Other options like HMDA (Home Mortgage Disclosure Act), TILA (Truth in Lending Act), and RESPA (Real Estate Settlement Procedures Act) cover different aspects of lending and consumer rights but do not specifically address the disposal of consumer information or its security. Therefore, they do not apply to the situation described in the question.