One purpose of the Fair and Accurate Credit Transactions Act is to prevent what issue?

The Fair and Accurate Credit Transactions Act (FACTA) was enacted primarily to combat identity theft and enhance consumer protection in relation to credit reports. One of its main provisions allows consumers to obtain free annual credit reports from the three major credit reporting agencies. This access helps individuals monitor their credit history for any unauthorized accounts or fraudulent activities, thereby directly addressing the issue of identity theft.

The Act also includes measures to improve accuracy in credit reporting, which further aids in preventing identity theft. By ensuring that consumers can regularly check their credit reports, FACTA empowers them to quickly identify and dispute inaccuracies, reducing their vulnerability to identity theft. This direct focus on protecting personal information within credit reports underlines why identity theft is the correct answer in relation to the objectives of FACTA.