The Old "New Credit File" Scam

By now, you have undoubtedly seen many ads and some Spam e-mail regarding a "fool-proof" way to create a "new credit file", otherwise know as "File Segregation".

"File Segregation"What is it?
File Segregation, (known as 'Getting a New Credit File') is the process of obtaining a separate identification number, usually a federally issued EIN (Employer Identification Number) or TIN (Taxpayer Identification Number), and using it in place of your Social Security number when applying for credit. This is intended to shield an applicant's true credit history from an inquiring agency. So far, this may sound like a reasonable idea.

OK, where's the scam?
The are many, many sites and scammers offering File Segregation Services, and each in turn is shut down by government investigators, but not before many people fall prey to the site operators first. What these operations are trying to do is to give you a "new identity". You pay their fee and sign up for their services. Then you are directed to apply for an Employer Identification Number. Sometimes, they even provide you the forms and some instructions on how to fill them out.

When you get the EIN, you will be told to use that instead of your Social Security number when you apply for credit. They'll probably also tell you to use a new mailing address.
OK, so what's wrong with "File Segregation"?

Basically, some of the acts to required accomplish this new credit file are ILLEGAL!
First, you are applying for an EIN, when in fact you have no intentions of using the number provided by the IRS for the intended purposes. Since the form requires you to sign it under penalties of perjury, well, you can see the problem there. You can view the application form at

http://ftp.fedworld.gov/pub/irs-fill/fss4.pdf.

Second, under the Federal Trade Commission's Credit Repair Act, it may be a felony to use a false identification number.

Third, if you use any means of interstate commerce, such as the mails, telephone, or fax, to submit an application for credit, you can also be prosecuted for mail or telecommunications fraud.

And finally, if a creditor is damaged (they lose money) because you defaulted on a loan obtained by an application with false statements, they can sue you for fraud as well.

Though it may be tempting and a quick fix for your present credit problems, it could cost you thousands of dollars and maybe even jail or prison time. And while you will have a second file for a while, it will not take very long for the credit bureaus to catch on. This scam has been around long enough that the credit bureaus are quite familiar with it, as soon as they detect it, they will merge the real and the "new" files, with an additional notation that you are using a false SSN.
http://mix6.com/credit/content/credit_repair

That's it for Now...Til next Time!

John VJohn C. Vincent/CEO/The Opt.In Magic System
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