A credit privacy number, or CPN, is a nine-digit ID that can be used in lieu of a Social Security number for credit reporting and other financial purposes, like applying for a loan. Also called a credit profile number, a CPN is primarily used for tracking credit history or applying for loans. You’ve probably heard of CPNs in the context of credit repair: A company will promise to issue you a CPN that will make it easier to qualify for new credit or get rid of bad debts. But be careful: Sometimes, those companies are selling a service that’s useless or even outright illegal.
So why use a CPN instead of an SSN, anyway?
Like an SSN, each person can only have one CPN. It’s used as a unique identifier for your financial transactions and lets lenders and credit reporting agencies keep an eye on your borrowing history. However, a CPN can help you keep your finances safe and hidden from the public eye. For that reason, it’s popular among elected officials, celebrities and people in witness protection programs. As the name implies, it’s mostly used by people who need a little extra privacy.
A CPN isn’t always a substitute for an SSN, though: You can’t use it for documents submitted to the IRS or an employer, registering a vehicle or applying for a government loan, for instance. If you have a CPN, it’s on you to know when you can and can’t use it.
CPN fraud: What to look out for
If you have bad credit, you may see a credit repair agency offering to build a new credit file for you by issuing you a CPN to use in place of your Social Security number. However, the CPN it gives you is really someone’s actual SSN, perhaps from a child, or someone who’s deceased, or it could be a valid, working number. The company tricks unsuspecting customers applying under someone else’s SSN. And, unfortunately, those customers find themselves unwittingly committing fraud.
Here are a few tips to avoid getting caught in a credit repair scam:
- It’s free to get a CPN, so don’t let anyone trick you into paying for one.
- Be careful about any company that promises a “new credit identity” – there’s no such thing. While you may be able to discharge some debts in bankruptcy, you can never get a whole new persona.
- Watch out for any company that asks for too much personal information, like your SSN or bank account numbers. When in doubt, run a quick Google search of the company to see if any complaints have come up.
- Don’t believe any company that asks you to apply for an Employer Identification Number (EIN) just so that you can use it instead of your SSN. While EINs are legal – businesses often use them when reporting to the IRS – they aren’t a substitute for an SSN.
- Know your rights under the Credit Repair Organization Act, which among other protections makes it illegal for credit repair agencies to charge you before they’ve performed services.
How do I get a CPN?
If you’ve decided that you want a CPN for legitimate purposes, your best bet is to talk to a lawyer and make sure it’s done right. Keep in mind that you’re on the hook for any debts you incur when you’re using your CPN, and make sure you know when your SSN is required.
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