Unless you have a large stash of cash at your disposal, you have to borrow money to buy things you need or want.  Large ticket items, like a new house or automobile usually require a loan from a financial institution. (Or you could try the lottery.)  If lenders determine that your credit rating is good, you’ll get a better interest rate than if your credit history is not the greatest.  For some people, fiscal irresponsibility has gotten them into trouble whether through late payments, no payments at all or large amounts of credit card debt.  The good news is that credit scores can be improved over time.  According to a press release issued by the Social Security Administration, 18 people were recently arrested for their alleged involvement in a scheme that purportedly used stolen identities to beef up their credit histories. (Obviously, if the facts alleged are true, the tactics used in this identity theft scam were not the right way to go about improving credit scores.)

The story reports that a 36-year-old man from Indiana and a 47-year-old woman from California are accused of operating an identity theft ring that involved stealing Social Security numbers (SSNs) and marketing them to individuals who needed to improve their credit scores.  The woman allegedly obtained SSNs from victims, many of whom were minors, and would market her services as a legitimate way to enhance poor credit through the sale of Credit Profile Numbers (CPNs) or profiles. (A legal CPN is a 9-digit number, such as a SSN, used to obtain credit.) Authorities say the man would then sell the SSNs, which were supposedly CPNs or profiles to people wishing to improve their credit scores while applying for credit applications to purchase expensive items such as vehicles. (Beware of anyone who offers to give you a new or verified credit profile to clean up a bad credit rating.  It’s a scam.)

In addition to allegedly selling the stolen SSNs, authorities say the man would also instruct the purchasers on how to present themselves to creditors so that they would appear to have a good credit report.  He allegedly advised the new identity purchasers to make fraudulent representations to the Bureau of Motor Vehicles with “novelty items” (Does this include party hats?) he supplied including fraudulent SSN cards, mortgage documents and other identification material.  As if that wasn’t enough, he also is accused of creating fraudulent credit histories that could be researched by banks during a credit check.

Let’s give credit where credit is due to authorities for uncovering the alleged scheme.  Clearly, the two defendants, who are accused of stealing the identity information and 16 of the people, who allegedly bought the stolen information, are in a heap of trouble.  If convicted, the defendants each face up to 20 years in federal prison for conspiracy, 30 years for making false statements on loan applications and five years for using a false SSN.  In addition, any property, such as houses or cars gained through the scheme, will become the property of the government if the defendants are found guilty.

Building your credit the right way takes time, effort and self control.  It’s a good idea to monitor your credit report, which you can get for free once a year.  If you do find yourself in a situation requiring help, beware of the term “credit profile number.”  A legitimate credit repair service would not use that term, nor would they require upfront payment to repair a bad credit history.  Honest credit repair services are required by law to put their fees and services in writing and must complete their services before requesting payment.

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