[16151] in APO-L
PRESS RELEASE - FOR IMMEDIATE RELEASE
daemon@ATHENA.MIT.EDU (Newportb@IX20.IX.NETCOM.COM)
Tue Feb 4 03:23:10 1997
Date: Tue, 4 Feb 1997 00:25:38 -0800
Reply-To: Newportb@IX20.IX.NETCOM.COM
From: Newportb@IX20.IX.NETCOM.COM
To: Multiple recipients of list APO-L <APO-L@VM.CC.PURDUE.EDU>
(reprinted with permission from Maximum Marketing)
=====================================
PRESS RELEASE - FOR IMMEDIATE RELEASE
=====================================
NEW CREDIT FILE: FRAUD OR LEGAL LOOPHOLE?
Recently the Federal Trade Commission has been aiming to shut down companies
providing this new service. But is the FTC shutting them down because the
New Credit File is illegal or are they shutting down these companies for bad
business practices?
California, February 1, 1997: If you have derogatory items on your
credit file then you've probably heard about "starting a new life with a New
Credit File within 30 days." Many companies are now offering this new
service, but it's not so new or innovative and it's not such a big secret
either.
Approximately 95% of Americans have experienced some degree of financial
difficulties at some point in their past which have left them with negative
items or a completely undesirable credit profile. Leaving many consumers
unhappy about their services, Credit Repair companies have proven
unsuccessful and most are borderline misleading or unscrupulous. The Federal
Trade Commission has been cracking down on such companies, either shutting
them down or forcing them to change their practices. Those who have tried to
fix their own credit reports have discovered that their credit files are
virtually unchangeable, regardless if the information is incorrect. Many
have accepted this as the reality they are forced to live with for the next
10 years.
Now there's a new strategy called the "New Credit File" which
professes to give you a new credit file completely separate from your
current file, and can usually be done within 10 to 45 days. Although this
may cause much controversy among financial institutions the FTC, to date,
has not been able to stop nor prohibit any company from providing
information or services related to a New Credit File. That's because Credit
Profiles are a creation of the business community and cannot be easily
regulated by federal laws; and the New Credit File is nothing more than a
loophole in their system. However, a company can be shut down for false
advertising or other reasons not related to such a service, or if the
consumer is advised to mislead or defraud any lending or financial institutions.
How the New Credit File works
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Creating a New Credit File is simpler than most would imagine. It's only a
matter of understanding how the credit bureaus systems operate and working
the loophole towards your advantage.
Every credit bureau has a particular system of file retrieval that
allows them to identify the file of each person in their system. It is
necessary to identify each file in such a manner as to separate individuals
with similar names and addresses so that Robert Jones will not appear on the
file as Bob Jones.
However, no bureau has yet come up with a perfect system of file
identification. That is why individuals will sometimes see items on their
report that belong to someone else with a similar name. This is most common
among parents whose children have established negative credit and have the
same first name as their parents.
In an effort to maintain maximum efficiency, credit bureaus prefer
to set up more than one file per person rather than risk merging several
people's files into one. Because of this, it is estimated that many people
have at least two credit files which have been "accidentally" created by the
credit agencies themselves. This is the "loophole" that one can use to their
advantage and is the reason why having a New Credit File cannot be illegal.
To explain in more detail, the credit bureaus have basic identifiers
which are used to search and retrieve a credit file. These identifiers are
social security number (or any identification number), first name, last
name, current address and previous address. When the computer proceeds to
match all of these identifiers to an existing file and fails to find a
match, it will automatically create a New Credit File.
When providing an identification number for credit or to open a bank
account, an Taxpayer Identification Number (TIN) can be given. Anyone with
little knowledge of the three types of Identification Numbers offered by the
Federal Government can easily create their own New Credit File. These ID
Numbers all have nine digits and two of these ID numbers are offered by the
IRS. The Social Security Number (SSN) is offered by the Social Security
administration, which most Americans have. The Employer Identification
Number (EIN) is issued to individuals for business purposes and the Taxpayer
Identification Number (TIN) is issued for banking and loan purposes; both
issued by the IRS. The TIN can also be used to open checking and savings
accounts and for credit purposes. This TIN is required when creating a new
file with the three largest national credit bureaus.
Once a New Credit File is created with one of the large three credit
bureaus, all other bureaus will obtain the same Credit File because they all
share their information amongst themselves about you and your credit history.
As easy as this appears, many companies are offering to perform this
service and are charging fees anywhere from $100 as high as $2,500. There is
a merit to their services however. Since it is a relatively easy task to
accomplish, there are several things that can cause your New Credit File to
be merged with your current file or altogether failing to create one. This
can cause some embarrassment when applying for a credit card or opening a
new bank account and both your new and old credit file information appears
during the credit check.
Anyone can complete this process themselves with a little study of
the system and a thorough understanding of the credit industry. The New
Credit File is truly giving many people the second chance they deserve with
their credit lifestyle. The credit industry was created to represent an
individuals past, but does not necessarily predict an individuals future credit.
=============================================================
(reprinted with permission from Maximum Marketing)
For a complete transcript of this Press Release which includes all the
details on: "Making the New Credit File Work for You" you may write to:
(when ordering a copy, please include a check in the amount of $24 for
reprinting and mailing)
Maximum Marketing
Public Relations Dept.
c/o 2646 Dupont Drive, Suite 263
Irvine, California 92715
