Creating a New Identity - Worst Credit Scam Ever

“Get Rid Of Your Bad Credit History”, “We Can Show You How To Leave Your Bad Credit History In The Dust”, Get A New Start By Leaving Your Bad Credit History Behind You”. These Internet and Email offers look very appealing, but are they real. Here is the true story behind these so-called cure-alls for bad credit.

Consumers with bad credit histories are getting offers to wipe the slate clean by creating whole new identities -- complete with a new Federal Employer Identification Number to replace their existing Social Security number!!! This process is called "file segregation", which means that you segregate, or separate, your bad credit history from a new, more pristine identity which you create. It's a scam that is proving so popular with debt-burdened consumers or credit-impaired consumers anxious to repair their credit profiles that the Federal Trade Commission (FTC) has made the identity-change game one of its top new enforcement actions and has gone after the companies selling so-called “new identity kits”.

The method for creating your new identity is to get a Federal Employer Identification Number, which, like your Social Security number, is a 9 digit number that the Internal Revenue Service issues to an employer to identify their business. You apply for the Federal ID number in your own name and use this number as your Social Security Number. It sounds easy and it is, the only problem is that it’s a federal crime to misrepresent your Social Security number and obtain a Federal Employer Identification Number under false pretenses. You could even be charged with mail or wire fraud if you use the mail or telephone to apply for credit and provide false information.

The FTC believes that most of the consumers using these kits are victims and that people wouldn't buy this stuff if they knew they were subject to criminal prosecution for following the advice in these “new identity kits”. They agree that some consumers are victims of credit repair scams but they also believe that some people are looking for ways to skirt the law. If it is clear that a person really believed what they had been sold was legal, then they probably won't be prosecuted, but someone looking for a scam as a way to establish a phony identity for the purpose of getting credit is headed for big trouble with the law.