Beware of the “New Credit Identity” Tactic

The Instant Credit Fix – Creating A New Credit Identity

The biggest credit repair scam that you must avoid is the purchase of new social security numbers or CPN. This particular credit repair scheme never seems to get old, or fall out of use.  So called “credit repair specialists”  advise their clients to create “new identities” to start building credit using a new social security number. The idea is that when you require a new social security number or CPN, you are able to start with a clean slate

They promote this as an instant credit fix and some charge thousands of dollars to set up their clients with new social security numbers, CPN (credit profile numbers) or even change their current social security number slightly and build new credit profiles for their clients.

But no matter how you look at it.  Changing your social security number, or knowingly using another number to apply for credit is illegal.

Where do new credit identities come from?

Here is te main reason creating new credit files is illegal.  The companies selling them often steal other peoples identities. Where do most of the social security numbers come from for this scam?

  • Elderly people – usually in homes with unethical workers.  And sometimes its their own families that sell access to their credit
  • Children – since they won’t even check their credit reports for many years – stealing childrens social security numbers is big business!  They are 100% clean.  You can start your credit history all over – until their parents find out and send you to jail!
  • Prison inmates – again this is a segment of society that won’t be checking their credit in some cases for a very long time.
  • Military personal – although this isn’t as prevalent as it was years ago.  Authorities caught on quickly that military personal were being targeted and they started a campaign to educate service men and women on how to protect their identity from identity thievies

Hence, the Federal Trade Commission advises consumers to be more cautious when acquiring credit repair services.  If you are being asked to use a different credit identity or a new SSN to replace your personal Social Security Number, you could be dealing with scammers and identity thieves.  The SSN you are provided with could be stolen from a child and you could be supporting identity thieves in their acts of crime. Of course, it is a crime and you can be accountable for it.

How The New Credit Identity Scam Works

In some cases, you might be provided with a different SSN and this Social Security number could have been stolen from a child.   Since children do not have credit history, their Social Security Numbers are a favorite target for id thieves as the crime can go undetected for many years.  When the child grows up and is ready to apply for a loan or a job, he/she may discover that his/her identity has been used fraudulently.

 

IF you presently have a poor credit score or a bad credit history, you can seek out professional advise from a legitimate credit counseling agency.  You can check out the National Foundation for Credit Counseling (nfcc.org) for a list of non-profit organizations that offer free or low-cost in-person counseling.

You can also check out the website of the US Trustee Program  (http://www.justice.gov/ust/eo/bapcpa/ccde/cc_approved.htm) for a list of approved credit counseling agencies in your State.

Remember that a reliable credit counselor will never advise you to resort to illegal tactics such as using a “new credit identity” to cover your bad credit.  A real counselor should spend time evaluating your financial situation and assess the root of the problem.  He/she will never advise you to sign up for a Debt Management Program without first considering all the possible solutions to your debt problem.

In conclusion, make sure to be weary of the credit repair scams out there. There are many companies promising to help you establish a credit history, but make sure they are reputable and not just after your money. Make sure to do your research before trusting any company with your identity and money.

A true credit counselor will also tell you the steps that you can do for free and your own to improve your bad credit such as your right to check your personal credit report for free through www.annualcreditreport.com; your right to dispute errors in your bill or in your credit report; as well as practical things that you can do to keep your problem from worsening.

 

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Elizabeth Roberts

Elizabeth Roberts

Liz Roberts and her team are continuously providing information to people who are ready to repair their credit and improve their credit score. Also NewHorizon.org team strives to empower the homebased and small business owners by bringing information that can help them to manage and grow their businesses. Let our 23+ years of business finance experience help you to get the financing you need! CONTACT US if need financing for your business.

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      NHBS Inc © 2022

      NewHorizon.org is an independent, advertising supported website. The owner of the site may be compensated in exchange for featured placement of certain sponsored products and services, or your clicking on links posted on this website. NewHorizon.org has not reviewed all available credit card offers in the marketplace.

      Privacy Policy Terms of Use

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