What is a credit privacy number (CPN)?

If you’re looking to repair your credit, you may have discovered a few different routes to take. One supposed option is a credit privacy number (CPN). CPNs are advertised as a way to conceal a less-than-perfect credit history. But how exactly does a CPN work? And is it even legal? Here’s what you need to know.

Key takeaways

• A CPN is a nine-digit number that looks like a Social Security number (SSN).

• Some companies sell CPNs as a quick fix for bad credit or a way to hide bankruptcies.

• Using a CPN to conceal your credit history is illegal and may be considered identity theft.

• Building credit takes time and requires responsible credit habits, such as paying bills on time every month.

A credit privacy number, or CPN, is a nine-digit number that’s formatted like an SSN. But it isn’t a substitute for an SSN, even though it’s often marketed as such. CPNs may be advertised as a solution for those with a poor credit history by providing a new, false credit identity.

The Social Security Administration provides SSNs to U.S. citizens and other groups of people, including international students and foreign workers. SSN holders can file taxes, find jobs, open bank accounts, apply for loans and more.

On the other hand, CPNs may be presented as a substitute for SSNs, but they’re not a valid alternative.

So-called credit repair companies claim a CPN can hide bankruptcies or poor credit by being used in place of an SSN by someone applying for new credit. But don’t fall for it: CPNs are often related to other types of scams. Your credit reports will still show any debts and bankruptcies. And misrepresenting your SSN on a credit application is a federal crime.

There are very few situations in which an individual would be granted a new SSN, and restarting your credit isn’t one of them.

Even in those specific situations where someone might need a new SSN, the process isn’t easy. And even if it does occur, your identity will still be attached to your old SSN.

Selling CPNs as a way to repair credit is illegal. And many companies that sell CPNs are selling stolen SSNs of unsuspecting victims—like children, prison inmates or senior citizens—and presenting them as CPNs.

To help protect yourself, stay away from situations that could be credit repair scams. One example of a scam happens when people are asked to pay a large sum of money or provide false information on a credit application. Rather than hiding credit reports as promised, this can lead to the creation of a false identity and risk of committing identity theft.

According to the Federal Trade Commission (FTC), the Credit Repair Organizations Act forbids credit repair companies from offering deceptive services. Here are some red flags to watch out for:

• Required payment before any work is actually done

• No written contract

• Impossible promises, such as removing true information from your credit file

• Suggestion to falsify your personal information on any credit account

If you’ve been a victim of identity theft, you can report it to the FTC online or by phone. You should also contact the three major credit bureaus:

• Equifax®: report fraud online

• Experian®: report fraud online

• TransUnion®: report fraud online

Thankfully, there are many ways to rebuild credit over time with responsible use. Here are a few strategies from the Consumer Financial Protection Bureau:

• Always pay your bills on time. Making on-time payments each pay period is essential for healthy credit. To help make sure you don’t forget, consider setting up automatic payments or reminders.

• Keep your credit utilization ratio low. Carrying a high balance on your cards can increase your credit utilization ratio and lower your credit scores. Closing credit card accounts and putting most or all of your credit onto one card can also hurt your credit by increasing your overall credit utilization ratio. Experts say it’s best to keep debt at no more than 30% of your available credit limit whenever possible. 

• Only apply for credit you need. Recent credit activity is one of the things credit-scoring formulas look at when determining your credit scores. If you apply for a lot of credit in a short amount of time, it could make it look like your financial situation has worsened. So it may be worth holding off on opening any new accounts while you try to rebuild your credit.

• Check your credit reports for errors. Monitoring your credit reports can help you spot mistakes or inconsistencies. So if you notice something looks off, be sure to report it and get it corrected as soon as possible.

• Seek out credit counseling. Rather than trusting your financial situation with a scammer, consider speaking to an accredited credit counselor about things like managing debt and building your credit.

It can feel overwhelming trying to build your credit, whether it’s for the first time or after a credit score drop. Some companies may take advantage of that by making false promises. Using a CPN to create a false identity for a credit application might be considered identity theft. And misrepresenting your SSN is a federal crime.

There are ways to build or rebuild credit with responsible use over time. Not sure where to start? Learn more about building or rebuilding your credit.