• Giving every consumer the right to their credit report free of charge every year. Consumers will be able to review a free report every year for unauthorized activity, including activity that might be the result of identity theft.
• Helping prevent identity theft before it occurs by requiring merchants to leave all but the last five digits of a credit card number off store receipts. This law will make sure that slips of paper that most people throw away do not contain their credit card number, a key to their financial identities.
• Creating a national system of fraud detection to make identity thieves more likely to be caught. Previously, victims would have to make phone calls to all of their credit card companies and three major credit rating agencies to alert them to the crime. Now consumers will only need to make one call to receive advice, set off a nationwide fraud alert, and protect their credit standing.
• Establishing a nationwide system of fraud alerts for consumers to place on their credit files. Credit reporting agencies that receive such alerts from customers will now be obliged to follow procedures to ensure that any future requests are by the true consumer, not an identity thief posing as the consumer. The law also will enable active duty military personnel to place special alerts on their files when they are deployed overseas.
• Requiring regulators to devise a list of red flag indicators of identity theft, drawn from the patterns and practices of identity thieves. Regulators will be required to evaluate the use of these red flag indicators in their compliance examinations of financial institutions, and impose fines where disregard of red flags has resulted in losses to customers.
• Requiring lenders and credit agencies to take action before a victim even knows a crime has occurred. With oversight by bank regulators, the credit agencies will draw up a set of guidelines to identify patterns common to identity theft, and develop methods to stop identity theft before it can cause major damage.

Consumer advocates have long encouraged people to monitor their credit report as a way to detect identity theft. The standard advice was to request a copy of your credit report once a year from each of the three national credit bureaus: Experian, TransUnion, and Equifax. Until now, you usually had to pay up to $9.50 to get a copy of your report from each of these credit bureaus.

Recognizing the benefit of self-monitoring, the Fair and Accurate Credit Transactions Act of 2003 allows you a free copy of your credit report annually from each of the "big three" credit agencies. Congress left it to the Federal Trade Commission (FTC), through regulations, to set up the procedure for obtaining your free reports.

That depends on where you live. The rules on free credit reports are among the first regulations adopted by the FTC. The procedure established by the FTC calls for a phase-in, starting with the Western states, in December 2004. If you live on the East Coast, your right to a free credit report will not take effect until September 2005. Here's the phase-in schedule:

December 1, 2004: Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming.

March 1, 2005: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin.

June 1, 2005: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, Oklahoma, South Carolina, Tennessee, and Texas.

September 1, 2005: Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, Vermont, Virginia, and West Virginia, Puerto Rico, and all U.S. territories.

To order your free reports when they become available in your state, go to www.annualcreditreport.com where you can order your reports directly or download the Annual Credit Report Request form to mail in your request. You can also call 877-322-8228. The World Privacy Forum has released a study that indicates that privacy-conscious consumers may be better served by ordering their credit reports by phone or mail rather than online. For more information about access to free credit reports, see the Federal Trade Commission's Facts for Consumers at www.ftc.gov/bcp/conline/pubs/credit/freereports.htm.