No, Buying Tradelines Is Not Illegal.
One of the biggest and most misunderstood ideas about authorized user tradelines is they are illegal. As an ethical, responsible, professional and reputable company who deals specifically in the buying and selling of credit card tradelines, we're here to clarify things once and for all with some very simple information-backed evidence.
Before we begin, we have to quickly mention that with a simple google search you'll find a ton of articles that cover this subject. Some of them, however, are extremely biased. As an example, we were able to find various sources claiming and presenting the argument that the act of buying authorized user tradelines is immoral, shady, and even illegal. Some were even going as far as saying you're literally committing fraud, while quoting extremely vague terms such as "bank fraud", "credit fraud", "identity fraud", etc. and then claiming that the consequences could include federal prison. All of this is written without any legitimate mention, citation, or information about how and why buying a credit card tradeline was "fraud".
The writers of those articles are uneducated in the subject matter, under-informed, misinformed, ignorant, have misinterpreted the writings of others, and in some cases are spreading complete misinformation. Regardless, there is only one truth, and the truth is that purchasing tradelines is not illegal.
Why Do Some People Think Buying Tradelines is Illegal?
The largest probable factor is simple ignorance or misunderstanding. Any type of financial transaction can quickly become illegal if a certain set of rules are not followed. Since most people are not familiar with the processes and methods that buying tradelines entails, they tend to be weary of them. This is a great example of why knowledge is power. The more you know about a subject the more inclined and capable you are to discuss it while simultaneously weeding through the rumors or assumptions and presenting the actual facts.
In addition, the more you know about a subject the more capable you are in utilizing that information in your favor. If you're unlearned about authorized user tradelines, denouncing them is the same as denouncing someone you've never met just because someone else's opinion about them is less-than-stellar. When it comes to tradelines or anything dealing with credit and finance, it's your personal responsibility to perform due diligence.
(NOTE: You cannot blindly trust anyone - even large institutions - when your identity and personal information are involved. Always be sure you know who and what you're getting into.)
There is also another aspect to this. The tradeline business tends to get a bad reputation because many people believe the only way to achieve a good credit score is through hard work, suffering, and being financially responsible for many many years. While this opinion may represent some good ideas, it does not make tradelines illegal.
Some of these people are so proud of their achievements, they allow their emotions to get in the way of reality. For example, they may think "I worked extremely hard to get the credit I have today, it's not fair that someone with lesser credit than me can simply pay to reap the benefits of someone else's credit history and achieve an 80 point credit increase in 3 weeks"... And for that alone, they may assume automatically (and without logic) that tradelines are shady or a scam - especially if they read one of the articles such as the ones I mentioned above. Clearly, this is an unfair and unpractical attitude. Whats even worse is when people who cling tightly to that perspective share their opinion with others while stating or implying that it's factual.
Now, let's assume you open a bank account with a fraudulent name in an attempt to scam the system. That would be something that can easily land you in jail or prison, because you're using false information and doing so intentionally. If you did the same thing when purchasing your credit card tradelines, it too would be illegal. But we're not discussing being a criminal who is trying to scam the system. We're talking about a completely legal process that has specific requirements and by no means illegal to practice for the user or the seller. We're discussing a process by which the card issuer is willingly and knowingly reporting your name and information to the major credit bureaus. An extremely common practice where your credit report clearly states that you are an authorized user of a specific credit line. The details are there in your credit report, as clear as day. They can only be displayed when the credit bureau decides to publish them, and only when receiving information from a reliable, authoritative source. If buying tradelines were illegal, nobody would be buying them nor would we be writing this blog right now. Lending institutions, card issuers and credit bureaus could easily prevent the reporting of authorized users on credit reports or eliminate the factor from a credit score if it were in fact legal to do so. But since they're not allowed to do that, they can't, they won't and they don't. Yes, tradelines are legal and this has been proven time and time again.
There is another aspect of being an authorized user where people assume it's okay to be added by friends and family, but not okay to utilize tradelines for sale. As if the act of paying is where things become shady, illegal, or problematic. Again, this is not fact - no matter how badly people want to believe it. There is nothing illegal about buying tradelines from a willing seller (whether they're your brother or a complete stranger) and benefitting in the form of an improved credit hisotry and a higher credit score. Again, measures could be easily implemented to determine who has a family relation or not, and then deny the authorized user status to those who don't qualify. However, that is not the case. It really doesn't take a genius to figure this all out.
How Do I Really Know It's Legal To Buy Tradelines?
This is an excellent question. The waters surrounding tradeline sales have become so muddied with opinions and fear that many people decide to steer clear for no other reason than uncertainty. Regardless of what we write above, you may decide that there's something strange going on. You don't see banks openly speaking about authorized users, and so there must be a reason for that, right?
These are the perspectives and ideas that are quite unfortunate. At the end of the day, fear of the unknown causes so many people to muss out on the opportunity of a lifetime - a tool that is rightfully theirs to use should they decide to do so.
We can begin discussing a couple interesting facts about the complete and factual legality of buying tradelines with a quote from an interesting article regarding the legality of buying them, where the author mentions the following:
"FYI: Creditor's make money off of interest. The lower your credit score the more you pay in interest, so why would they want you to do anything to help increase your credit scores if it is going to impact how much money they can make. So I expect them to frown upon it or not like it but that does not make it illegal."
Without getting into too much detail, the quote above can lend some great insight into the people who seem to be strongly against the idea of consumers executing their right to buy tradelines. With just a little imagination, we can quickly see where and why the negative rumors all began. It's pretty simple to see who doesn't want you to pay less in interest, or get better loan terms, or spend less of your hard-earned money.
It's important to mention that at one point, FICO (the Fair Isaac Corporation, the literal inventor of the credit scoring system) claimed that they would be changing their credit rating formula to exclude the way that authorized user status affects an individuals score. The general assumption about that announcement was that FICO was essentially trying to eliminate and inhibit people from buying credit card tradelines by refusing to calculate the authorized user status into a credit profile's score.
In 2008, FICO brought their concerns to a congressional hearing. They basically argued that not only the sales and purchasing of tradelines was immoral and unfair, an abuse of the authorized user system, and somehow needed to be mitigated, prevented, or banned altogether.
However, The Federal Reserve Board, The Federal Trade Commission, and Congress did not agree. They cited the Equal Credit Opportunity Act as a safeguard for consumers which prohibited FICO from following through with their wishes. This ensured that buyers and sellers of tradelines were protected by anti-discrimination law, and could not be penalized nor persecuted by credit scoring systems or agencies regardless of whom they obtained their tradelines from.
Furthermore, during the same hearing, the president of FICO openly said that they could not legally distinguish between the authorized user accounts of spouses and others (we can presume that "others" means paid users), since discriminating based on marital status would unlawfully violate ECOA. Quite the contradiction to their initial intent.
So, after consulting with Congress and multiple federal agencies, FICO was blocked from discriminating against AU account holders. Although they had clearly been against it, they were forced to admit that they were powerless to prevent it. Not only were they powerless, but they were prevented by law and forced to acknowledge this.
With that being said, FICO - from a business perspective - clearly would have a vested interest in eliminating the ability of an individual to benefit by becoming an authorized user of someone elses credit card. But the story gets even more interesting.
After the failed attempt and pleas, a representative of FICO actually stated the following during a different meeting with financial officers and government officials:
"Last year, Fair Isaac announced that with our new model update, which is referenced as FICO '08, authorized user accounts would no longer be included in the calculation of the scores. Fair Isaac was trying to protect lenders and consumers from a new type of credit repair practice known as "piggybacking". Piggybacking is an attempt to artificially and deliberately misrepresent consumers' credit histories to potential lenders by paying consumers with good credit scores to add strangers with poor credit scores to their credit card account as an authorized user.
After consulting with the Federal Reserve Board and the Federal Trade Commission earlier this year, we have now decided to continue considering authorized user account tradeline information in the FICO '08 models."
In other words, FICO came back claiming that they were only trying to "protect consumers" as if they work in law enforcement or healthcare. Very clever use of words while back-pedaling their stance for the record, don't you think? You can read it with your own eyes, from the official House Hearing of the 110th Congress, titled 'What Borrowers Need to Know About Credit Scoring Models and Credit Scores'. It's a long read but pretty interesting for those of you who are inclined to check it out.
Today, we are at the end of 2022 and still, there is no written record available of anyone being arrested for buying or selling a legal, non-fraudulent tradeline. This brings us to another important point.
Be Careful Where You Buy Your Tradelines
Yes, your tradeline could be illegal and fraudulent if you're using a fake identity, purchasing an actual account rather than being added as an authorized user, or, knowingly misrepresenting data on your credit report or your authorized user purchase such as a false name, address, or social security number. CPNs, which you can read about here, are also a big no-no when it comes to tradelines.
The only thing you need to do to ensure your tradeline purchase is legal is be honest, and make sure you're purchasing from a reputable and trusted company. And if you're in doubt or unsure, do your research before buying and never commit to a purchase without first understanding the tradeline company policies and practices.
GFS Group has a long history of selling real, ethical, and legitimate credit card tradelines in which our best interests are delivering a smooth and helpful experience for both the buyer and the seller. We do not encourage or utilize illegal practices and we never pressure users into making purchases.
If you have questions, we have answers - so feel free to reach out and ask. Our highly experienced team will gladly answer you in complete detail and clarity, and even guide you in finding the tradelines for sale that best suit your financial needs and current credit situation. We're here to help, and most of all we're proud to say that we have helped thousand of people achieve their goals. Our customer reviews speak volumes about us and we invite you with open arms to become one of those satisfied customers.
Yes, we proudly sell high-quality authorized user tradelines. No, buying tradelines is not illegal.
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