The Federal Trade Commission (FTC) identifies new credit privacy numbers as a type of credit repair scam that every consumer should be aware of. To help keep yourself safe, you need to know what a credit privacy number is, what red flags to look out for and any alternative legal solutions you should consider instead.
A credit privacy number (CPN) is a nine-digit personal identification number that is similar to a Social Security number (SSN). A CPN is often offered to individuals who have a poor credit history and are looking for a quick fix. The number is sold as a solution so that consumers can use a new CPN rather than their existing Social Security number when applying for credit. This way, they are given the opportunity to start from scratch and not have their credit history follow them.
While that may be how some dress up the CPN, it’s actually a scam. Often, the CPNs that are sold are just dormant Social Security numbers of children.
Unfortunately, even though you’re the one being scammed, you can be held legally responsible for using a CPN. If you use a CPN to replace your Social Security number, it’s considered an act of identity theft. As identity theft is regarded as a Federal crime, the consequences are quite severe, and you could end up serving time in prison for your actions or being charged significant fines.
Consumers fall for the CPN scam on a daily basis when they don’t know the red flags to look out for. Most often, a consumer is told they’re being offered a “new Social Security number” when, in fact, it’s a CPN. One of the biggest indications that you’re being scammed is when you’re being charged money for a replacement Social Security number, because an SSN is free to obtain.
Another red flag is when you’re asked to provide false information. For example, being asked to create a fake email address or an incorrect home address to match the “new SSN.” This could be identity theft and is potentially illegal. If you follow a credit repair company’s advice to commit fraud, ultimately, you can still be held liable for your actions. So, even if a company sold you a number they shouldn’t have had, the minute you use that number, you’re accountable for your actions.
In general, it’s vital that you don’t believe companies that tell you they can give you a new credit identity. There is no legal way to get a completely new credit identity for the sole purpose of escaping poor credit.
There are particular scenarios in which a person can get a new, legal SSN from the government. The Social Security Administration will consider an application for a new SSN if:
- A person is being abused, being harassed or in danger when using their old Social Security number.
- You can prove that your Social Security number has been stolen and someone else is using it. You will also have to provide evidence that the misuse is causing you harm in one way or another.
It’s important to note that even with a new SSN, you can’t ever “get away from” your old Social Security number and credit information. Government agencies may keep records under your original SSN. Additionally, credit reporting agencies will likely tie your new SSN to your previous file, so you aren’t guaranteed a completely fresh start.
While getting a new number and starting fresh may sound like an easy solution, it’s simply a lie. You can’t escape your credit history. The good news is that anyone can take steps to improve their credit. Having a low credit score is not a permanent sentence—you can take actions that will help it increase over time. These actions include making payments on time and in full, lowering your debt, maintaining a reasonable credit utilization ratio and more.
When you look for credit repair solutions, always work with reputable, safe companies. A shady company might try to rope you into a credit privacy number scam, but a proper credit repair organization will never go that route. Instead, a good credit repair company will explain to you their process for analyzing and removing inaccurate negative items from your credit report, mention your rights under the Credit Repair Organizations Act and not ask for payment before services are performed.
You can check whether a credit repair company is legitimate by looking at how long it’s been in business, as illegitimate companies tend to be shut down quickly.