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Scammers Snatch Social Security Numbers Of Children

There's a new scam involving Social Security numbers that is targeting kids.

Authorities say hundreds of online businesses are using computers to find unused Social Security numbers. Those numbers are usually assigned to children who don't use them. In other words, the number has not been used to open a bank account or a passport.

Scam artists are finding the numbers, then selling them under another name to help people get phony credit that they never pay off.

Authorities say the scheme could pose a new threat to the nation's credit system. Because the numbers exist in a legal gray area, federal investigators have not figured out a way to prosecute the people involved.

"If people are obtaining enough credit by fraud, we're back to another financial collapse," said Linda Marshall, an assistant U.S. attorney in Kansas City. "We tend to talk about it as the next wave."

The sellers get around the law by not referring to Social Security numbers. Instead, they refer to CPNs — for credit profile, credit protection or credit privacy numbers.

The scheme works like this:

Online companies use computers and publicly available information to find random Social Security numbers. The numbers are run through public databases to determine whether anyone is using them to obtain credit. If not, they are offered for sale for a few hundred to several thousand dollars.

Because the numbers often come from young children who have no money of their own, they carry no spending history and offer a chance to open a new, unblemished line of credit. People who buy the numbers can then quickly build their credit rating in a process called "piggybacking," which involves linking to someone else's credit file.

Many of the business selling the numbers promise to raise customers' credit scores to 700 or 800 within six months.

If they default on their payments, and the credit is withdrawn, the same people can simply buy another number and start the process again, causing a steep spiral of debt that could conceivably go on for years before creditors discover the fraud.


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