Viral credit score hack puts consumers at risk of jail, FTC warns

‘The truth is, credit repair companies can’t legally remove information from your credit report if it’s accurate and current,’ the Federal Trade Commission said

A social media “hack” to boost your credit score could land you in jail, the federal government has warned.

The Federal Trade Commission, the department tasked with protecting consumers from deceptive and unfair business practices, warned against the social media trend that encourages people to file fraudulent identity theft reports to erase accounts with late payments that can have a negative impact on a credit score.

In one TikTok video, a so-called credit repair influencer, with more than 15,000 followers, is seen championing someone apparently filing a false identity theft report. Within four days, at least some negative accounts were removed from her credit history, according to the video.

“Everything has gotten deleted, and I ain’t pay nobody back,” one video claimed.

The advice has surfaced on other credit-repair accounts, with posts about using identity theft reports getting tens of thousands of interactions.

‘Some online influencers are telling people they have a fix: file a false identity theft report about a debt they owe,” one federal agency warned (Copyright 2020 The Associated Press. All rights reserved.)

While the move can boost your credit score - for those whose identity was actually stolen - to file a false report is illegal, according to the Consumer Financial Protection Bureau.

“Some online influencers are telling people they have a fix: file a false identity theft report about a debt they owe,” the commission stated Monday. “That’s advice not to take.”

People who file fake identity theft reports can face serious consequences, the commission noted.

This tactic isn’t just being pushed on social media by influencers and individual accounts, the FTC pointed out. Some credit repair companies are leveraging the move, too.

“The truth is, credit repair companies can’t legally remove information from your credit report if it’s accurate and current,” the commission said.

In theory, credit reporting agencies have to remove an account from your credit history if it’s fraudulent, according to the Consumer Financial Protection Bureau.

But to do so requires filing an identity theft report with all three credit bureaus (Equifax, Experian, and TransUnion), providing proof of identity and a letter “identifying the fraudulent debts and information on your credit report,” the bureau said.

Equifax is one of three credit bureaus that can remove fraudulent accounts from your credit history, provided the account meets certain requirements ((Mike Stewart/AP))

A credit bureau will review the evidence and must block the fraudulent information from your credit report within four days of receiving your request. From there, creditors wouldn’t be able to send the fraudulent accounts to collections (which would cause even more damage to your credit score).

Filing a fake identity theft report can have serious consequences, the Federal Trade Commission said. Paying penalties and jail time are within the range of punishments.

“Filing a false identity theft report may leave you worse off - and it’s a crime that could get you a fine, imprisonment, or both,” the commission said.

Additionally, the credit bureau has the power to block your attempt at removing information from your credit history if it finds out your identity theft claim isn’t legitimate.

“Remember that you can use identity theft reports only for debts that are the result of identity theft,” the Consumer Financial Protection Bureau said. “Credit reporting companies may decline to block or rescind a block if you make a material misrepresentation of fact about being a victim of identity theft or if you got goods, services, or money as a result of the blocked transaction.”