What is a credit privacy number?

Key takeaways

• A credit privacy number, or CPN, is a nine-digit number similar to a Social Security number.

• Companies may try to sell you a CPN with promises of avoiding bankruptcy, but this is a scam.

• Using a CPN for identity concealment purposes is illegal, as it's a type of fraud and may involve identity theft.

• There are other ways to rebuild your credit, such as improving your credit score with on-time payments.

When you’re trying to smooth out some blemishes on your credit history, you might wonder if there is a quicker way to repair or rebuild your credit. Some companies take advantage of people in these situations and market credit privacy numbers, or CPNs, as an option for quickly building or improving credit.

Such companies may make it sound like getting a CPN and a “new” credit profile can answer your credit woes. These companies may claim a CPN can help with taking out loans, credit cards or even mortgages. Unfortunately, these quick fixes are typically full of empty promises. Not only does a CPN fail to build or repair your credit, but using one can have serious legal consequences.

What is a credit privacy number (CPN)?

CPNs are almost always tied to identity theft and other kinds of fraud.

A CPN is a nine-digit number that looks like a Social Security number (SSN). You may also see a CPN referred to as a credit profile number or credit protection number. Whereas an SSN is a nine-digit number issued to U.S. citizens,  permanent residents and temporary residents so they can claim Social Security benefits and have a unique identifier, a CPN is void of any legal standing.

Worse, CPNs might actually be someone else’s stolen Social Security number. Other criminals use programs to spoof fake Social Security numbers to make them pass as legitimate ones. Usually, they do this by using Social Security numbers that haven’t been issued yet.

How do CPNs work?

Some companies marketing themselves as credit repair specialists advertise CPNs as an SSN alternative. They promote CPNs as a way to avoid bankruptcy or “start over” if you have a poor credit rating. Companies may also claim using a CPN is a way of protecting your privacy or identity, encouraging you to use it instead of a legal SSN to apply for credit without revealing your identity or exposing your credit profile.

A company may claim it can quickly boost your credit score to 700 or 800 with a CPN. In reality, though, this is an illegal practice. Your SSN is your only legitimate form of credit identity.

What is the legal standing of CPNs?

CPNs have no legal standing because a government body does not issue them. In fact, the use of a CPN is illegal according to the Credit Repair Organizations Act. Companies that offer CPNs have often illegally obtained them by stealing the identity of a child, an incarcerated individual, a deceased person or a senior citizen.

No matter how this information is obtained, using false information like a CPN on a credit application could involve you in identity theft. Plus, lying on a credit card or loan application is considered fraud and can result in fines or even prison time.

How can you avoid a CPN scam?

These “quick-fix” credit companies are experts at marketing themselves as a legal alternative or a quick fix for credit issues. Companies offering a CPN often charge hundreds, possibly thousands, of dollars for this service, which is a major red flag. Unlike legitimate credit repair companies, they may also ask for the money upfront before performing any work.

When a company encourages you to provide false information, such as a different mailing address, email address or phone number, this is another red flag. The company may tell you this is for protecting your identity, but it’s ultimately a way of falsifying your information.

Companies may also promise to quickly remove any blemishes from your credit file, even accurate ones. In reality, however, you cannot remove accurate negative information from your credit profile except by waiting for it to roll off over time.

If you suspect a company is running a scam, report the information to the FTC online and contact the three credit bureaus: Experian, Equifax and TransUnion.

What are alternatives to using a CPN?

Companies offering CPNs often target people with poor credit ratings looking for a quick fix for credit repair. Unfortunately, there is no quick way to improve your credit score.

However, there are legal, proven methods for improving your credit, including:

• Paying bills on time: Making on-time payments is the biggest factor for improving your credit score. Every lender with whom you have open credit reports your payment activity to the three bureaus each month. If you’re more than 30 days late, your delinquency will be reported to the bureaus and decrease your score. Paying on time shows lenders you’re a reliable borrower, and it helps increase your score over time.

• Keeping credit utilization as low as possible: Credit utilization is simply the percentage of credit you’re using on revolving accounts like credit cards compared to the total amount of credit available to you. Most lenders prefer seeing a utilization rate of 30% or less, but this can vary from one lender to another. The lower the number, the better it is for your credit score.

• Limiting the number of new applications: If you have several credit inquiries in a short period on your credit profile, you may see your score decrease by a few points. This could also raise a red flag with lenders the next time you apply for credit.

• Checking your credit report for errors: Mistakes happen. Credit bureaus have to deal with an incredible amount of data. You can check your credit report for free at least once per year from each of the three credit bureaus. Carefully review your report for accuracy each time. If you do find an error, each bureau has instructions online for submitting documentation and requesting a profile update. You can also use a credit repair company to help you dispute errors.

• Keeping old credit accounts open: It may feel counterintuitive to keep an account open that you no longer use, but this can help you build your credit score. Leaving the card open increases the amount of credit you have available, which helps keep your credit utilization number in check. The number of years you have an account is also reported on your credit profile, and a longer credit history is beneficial for improving your credit score.

• Patiently waiting for negative marks to fall off: Over time, the blemishes on your credit report will disappear. Most information falls off after seven years, but some entries, like a bankruptcy, can stay on your report for up to 10 years.

Can you improve your credit without a CPN?

You can improve your credit without using a CPN, but it won’t happen overnight. Taking steps such as limiting new credit applications and keeping credit utilization as low as possible can help you improve your credit score over time. Stay patient and continuously monitor your credit activity to spot any errors so you can correct them and keep your credit-rebuilding process on track.

Keep in mind: If you do receive offers for CPNs, don't take the bait. The risk of fraud and identity theft isn't worth the false hope of a quick credit fix.

Frequently asked questions

• No, using a CPN for work can create a major issue for you. A CPN is typically marketed as an alternative to a Social Security number, but it’s not a legal form of identification, and it may have even been stolen from someone else.
  
  When you use a CPN instead of an SSN on a job application (or for any other application), you risk committing identity theft. If you’re concerned about providing your SSN to a potential employer, you can ask the employer if they plan to pull your credit report. Meanwhile, you can take steps to improve your credit history through legitimate activities rather than using a CPN.
  

• Using a CPN is illegal and considered a form of fraud and, in some cases, identity theft. Identity theft is a federal crime, and if convicted, you can face substantial penalties. Depending on the charges, identity theft or fraud can result in up to 30 years in imprisonment, fines and forfeiture of property.
  

• A credit privacy number, or CPN, is not the same as an EIN, or Employer Identification Number. Any government entity does not issue a CPN, and using one is a form of fraud. An EIN, on the other hand, is issued by the IRS. It is a legal method for identifying a business entity. Almost any business can apply for and receive an EIN for free.