CPNs: The New Source of Rental Application Fraud

Use Automated Income Verification from Payscore as your first line of defense

A CPN, or credit privacy number, is a nine-digit number that closely resembles a Social Security number (SSN). CPNs are often advertised as a solution for individuals with poor credit history. They are marketed as a solution to create a new, false credit identity.

Some credit repair companies promote CPNs to help individuals hide their bad credit history or bankruptcy. They are one of the fastest growing tools used by applicants attempting to find ways to mask historical financial troubles, essentially defrauding property management teams in the application process. Automated income verification from Payscore delivers the protection your property deserves by revealing the truth about applicant income.

Understanding Fraudulent CPNs

A fraudulent CPN is a nine-digit number that some individuals use as an alternative to their Social Security Number (SSN) when applying for credit or housing. These CPNs are often marketed as a tool to improve credit scores or hide negative credit history. However, their use can have serious consequences, especially in the rental housing market.

The Impact on Rental Applications

  • Increased Fraud Incidents: According to a groundbreaking survey conducted by the National Multifamily Housing Council (NMHC), rental housing providers have experienced a surge in fraudulent applications and payments. 70.7% of respondents reported encountering fraudulent documentation, financial statements, and even identity theft within the past twelve months.
  • Evictions Linked to Fraud: One of the most notable findings was the share of evictions tied to fraudulent applications. On average, 23.8% of eviction filings were linked to fraudulent applications and related failure to pay rent over the past three years.
  • Financial Impact: Rental housing providers face higher costs due to fraudulent applications. The average respondent had to write off nearly $4.2 million in bad debt over the past 12 months. Approximately 24.5% of this bad debt could be attributed to nonpayment of rent resulting from fraudulent applications¹.

Social Media's Role

  • Fueling Fraud: Social media platforms like TikTok Facebook, and Instagram contribute to the rise in false rental housing applications. Fraudsters exploit these channels to share information and engage in criminal behavior.
  • Undermining Credibility: The credibility of eviction data is compromised when a significant portion of eviction filings is linked to fraudulent applications.

Call to Action

NMHC President Sharon Wilson Géno emphasizes the need for action. Lawmakers and courts must address this issue to protect both renters and housing providers. But you can take immediate steps today. Fraudulent CPNs impact rental housing affordability, increase costs for providers, and challenge the integrity of the housing market. Vigilance and informed decision-making are crucial to maintaining a healthy rental ecosystem. ‘Click-to-verify’ simplicity from Payscore delivers the truth about applicant income and supports onsite teams in their leasing decisions.

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