What Is a Credit Privacy Number (CPN) and Is It Legal?

By Ana Gonzalez-Ribeiro, MBA, AFC®
Published on: 01/13/2022

Repairing your credit can be a daunting task. When researching how to improve your credit, you may have heard of a credit privacy number (CPN).

But before you decide to get a CPN, there are a few things you should know.

What is a credit privacy number and what is it used for?

A credit privacy number (CPN) is a nine-digit number that looks just like a Social Security number. That’s no coincidence because illegitimate CPNs are actually stolen Social Security numbers.

However, there are also legitimate CPNs, which you’ll learn about later in this article.

Some people refer to a CPN as a “credit privacy number,” while others call it a “credit protection number” or “credit profile number”.

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By any name, a CPN is something to be wary of — especially if someone’s trying to sell you one. Some companies will charge hundreds or even thousands of dollars for a CPN.[1] CPNs you can buy are illegal.[2]

Scammers will describe CPNs as a second version of a Social Security number that supposedly adds extra security. They’ll tout them as a way to clean up your credit quickly.

Don’t be fooled, though: CPNs marketed this way can land you in hot water.

Can a CPN be used instead of your Social Security number (SSN)?

Scammers will tell you that you can use a CPN instead of your Social Security number as a way to fool financial institutions and other lenders into thinking your credit is better than it really is.

Any legitimate CPN is actually tied to your Social Security number, so it’s not a way to hide bad credit history. The only people who qualify for legitimate CPNs are people who have a need to protect their privacy, such as government officials, celebrities, and people in the witness protection program.[1]

Legitimate CPNs aren’t sold on the open market: They’re free to those who need them and are available through the Social Security Administration.

Are CPNs illegal?

Illegal CPNs are produced when companies sell numbers that purport to be CPNs. They are instead peddling recycled Social Security numbers. These are SSNs they’ve checked against public databases to find out whether they belong to people without any credit history.[2]

The people whose numbers typically surface on such lists are children, the elderly, and people who’ve been incarcerated for many years. These are real people. If you use their Social Security number, even unwittingly, on the assumption that it’s a CPN, you could be charged with federal crimes such as identity theft and making a false statement on a loan application.

Such charges can result in fines and time behind bars.

In July 2021, eight defendants in Raleigh, North Carolina, pleaded guilty for accepting fees from clients in return for alleged credit repair services. According to the federal indictment in the case, what they were really doing was creating fake credit profiles and changing their clients’ credit data.

Acting United States Attorney G. Norman Acker III called the case an example of using CPNs to commit identity theft.

“The charges in this case largely involve the use of a false Social Security Number to obtain money, credit, or other valuables, under a false identity,” Acker said. “Synthetic identity frauds such as these often involve the use of what are referred to as ‘CPNs’ or alternate ‘credit profile numbers.’ These are nothing but fancy-sounding terms for Social Security Numbers that do not belong to you.

“The public needs to know that when you place a fraudulent Social Security Number or CPN on a bank credit application or loan document — you are committing a fraud, and you could face federal prison time for it.”[3]

How to avoid CPN scams

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It’s pretty easy to spot CPN scams if you know what red flags to look for.

Be careful about dealing with any company that promises a new credit identity. If they tell you a CPN is a substitute for a Social Security number, don’t believe them, and if they try to sell you a CPN, remember that legal CPNs aren’t for sale.

Similarly, don’t believe any company that asks you to apply for an employer identification number. EINs are legal, but businesses use them when reporting to the IRS, and they’re not a substitute for Social Security numbers.[4] Scammers, however, will try to tell you that they are.

Legitimate ways to rebuild credit

Rebuilding your credit isn’t something that happens overnight, but that doesn’t mean it can’t be done. On the contrary, there are a number of ways to go about rebuilding your credit legitimately, without resorting to anything suspicious or illegal.

Reach out to a credit counselor

Credit counselors are available to help you build your credit. Credit counseling services can help you with things like budgeting, creating a debt management plan, dealing with debt collectors, repaying student loans, and other ways to improve your credit.

The National Foundation for Credit Counseling, or NFCC, is a national network of nonprofit credit counseling agencies that can help you find an accredited counselor to work with.[5] Credit counselors are different from credit repair companies, which offer to help you repair your credit for a fee.

Credit repair companies will try to get errors removed from your credit reports by disputing inaccurate information. However, it’s possible to fix credit report errors yourself without paying someone else.

Be aware that no credit repair company can get negative marks removed from your credit file if they’re accurate.

Pay all your bills and loans on time

The most important thing you can do to improve your credit is to make your payments on time, such as your credit card bills, loans, and utility payments. Your payment history affects your FICO® credit score more than any other single factor, accounting for 35% of the total. See more about how credit scores are calculated.

Payments that are more than 30 days late get reported to the three major credit bureaus and stay on your credit report for seven years. But keeping up with your payments consistently can build your credit, especially over time, because the length of your credit history also affects your credit score. See more about how late payments affect your credit history.

If you’re looking to rebuild your credit, a secured credit card can be an option worth exploring. You secure your card with a deposit (usually a few hundred dollars) in a linked account that’s only accessed if you miss a payment. But as you make payments on time, your credit score will probably rise. See more about using a secured credit card to build credit.

Keep your credit utilization low

Your credit utilization ratio is the amount of debt you have on all your credit cards divided by your total credit limit. If you have a credit limit of $5,400 on four credit cards, for example, and owe a total of $1,200 on all four, your credit utilization ratio is 22.2%.

Experts advise borrowers to keep their credit utilization ratio below 30%, with the best credit scores typically going to those with a ratio of 10% or less.[6]

What to do instead of using a CPN

Obtaining a CPN is not a legal way to get rid of poor credit. If someone’s trying to sell you one, it’s best to steer clear.

Instead of looking for a quick fix, pursue legitimate ways of building your credit, such as making your payments on time, reducing the amount of debt you're carrying, and consulting a credit counselor to develop an effective, long-term strategy.

Sources

  1. Yahoo! News. “What Is a CPN, or Credit Privacy Number?” https://www.yahoo.com/news/cpn-credit-privacy-number-120023519.html. Accessed September 10, 2021.
  2. Federal Reserve Bank of St. Louis. “The Old, the Young and the Incarcerated: Latest ID Theft Victims,” https://www.stlouisfed.org/publications/bridges/winter-20102011/the-old-the-young-and-the-incarcerated-latest-id-theft-victims. Accessed September 10, 2021.
  3. United States District Attorney’s Office, Eastern District of North Carolina. “Ten Defendants in Synthetic Identity Fraud Ring Convicted of Bank Fraud, Wire Fraud, and Related Charges,” https://www.justice.gov/usao-ednc/pr/ten-defendants-synthetic-identity-fraud-ring-convicted-bank-fraud-wire-fraud-and. Accessed September 10, 2021.
  4. Federal Trade Commission Consumer Information. “Credit Repair Scams,” https://www.consumer.ftc.gov/articles/0225-credit-repair-scams. Accessed September 10, 2021.
  5. NFCC. “A trusted non-profit organization to help manage your finances,” https://www.nfcc.org/about-us/. Accessed September 10, 2021.
  6. CNBC. “Does a $0 balance on your credit card make your score go up?” https://www.cnbc.com/select/what-is-a-good-credit-utilization-ratio/. Accessed September 10, 2021.

About the author

Jeff Smith is the VP of Marketing at Self Financial. See his profile on LinkedIn.

About the reviewer

Ana Gonzalez Ribeiro, MBA, AFC® is an Accredited Financial Counselor® and a Bilingual Personal Finance Writer and Educator dedicated to helping populations that need financial literacy and counseling. Her informative articles have been published in various news outlets and websites including Huffington Post, Fidelity, Fox Business News, MSN and Yahoo Finance. She also founded the personal financial and motivational site www.AcetheJourney.com and translated into Spanish the book, Financial Advice for Blue Collar America by Kathryn B. Hauer, CFP. Ana teaches Spanish or English personal finance courses on behalf of the W!SE (Working In Support of Education) program has taught workshops for nonprofits in NYC.

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Written on January 13, 2022
Self is a venture-backed startup that helps people build credit and savings. Comments? Questions? Send us a note at hello@self.inc.

Disclaimer: Self is not providing financial advice. The content presented does not reflect the view of the Issuing Banks and is presented for general education and informational purposes only. Please consult with a qualified professional for financial advice.

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