How to protect yourself from renter fraud

“Unfortunately, I suspect we’re about to see more of this because of self-isolation and social distancing during the pandemic,” said Igor Popov, chief economist at Apartment List.  Adobe Stock

Michele Lerner — Boston.com correspondent

April 9, 2020 7:45 pm

When Robyn Flynn recently rented a home in South Lake Tahoe, Calif., she found herself with a shady landlord who refused to make repairs. Like many renters, she didn’t know anything about the landlord before she moved into her new place.

“I always owned a home before this move, so I wasn’t sure if the landlord was typical or if he had a bad reputation,” said Flynn. “A friend of mine in Boston told me about this service called MySmartRenter that I could use, and I found out that the landlord has multiple lawsuits against him for not taking care of his rental properties.”

For Flynn, learning about the lawsuits will give her extra knowledge she can use when confronting her landlord about the condition of her home. She also plans to proactively investigate a landlord before she rents again. 

While Flynn’s situation revealed a bad but not necessarily fraudulent landlord, rental fraud is unfortunately common. A study by ApartmentList.com found that 43.1 percent of renters have come across a listing they thought was fraudulent and that 5.2 million renters in the United States have lost money to rental fraud. 

“A lot of rental fraud happens when people can’t see a rental in person because they are renting long distance,” said Igor Popov, chief economist at Apartment List in San Francisco. “Unfortunately, I suspect we’re about to see more of this because of self-isolation and social distancing during the pandemic.” 

One in three victims of rental fraud lost more than $1,000, and 17 percent-plus were out more than $2,000, said Popov, noting that it’s usually a security deposit or the first month’s rent for a nonexistent rental.

Common types of rental fraud

Rental fraud often involves listings that are not available or don’t exist at all, said Popov. 

“The most common scenario is a ‘bait-and-switch’ scheme where a landlord advertises a unit, accepts a security deposit, and then later reveals that particular apartment isn’t available,” said Popov. “Renters may lose their deposit or end up with a less desirable unit.”

Two other common types of fraud occur when a scammer hijacks a legitimate listing or makes up one for a nonexistent home.

“For example, the scammer will take a legitimate real estate listing for a property that’s for sale and download the photos and address,” said Popov. “They’ll collect the security deposit and disappear before someone realizes that the property isn’t available for rent.”

Other issues include rentals that are missing promised amenities, such as heat, air conditioning or laundry equipment. In that case, the landlord tries to get the lease signed and all of the deposits before the renter discovers the problem.

“Unfortunately, younger renters tend to be victimized more than older renters, with about 9 percent of 18-to-29-year-old renters reporting that they lost money compared to 6.4 percent of all renters,” said Popov. 

Ways to protect yourself

One possible protection is the app George Genel, CEO and founder of MySmartRenter.com in Concord, introduced in January. It provides renters with information about prospective landlords.

“Tenants are used to paying for landlords to check their credit, but nobody thinks to check on the landlord,” said Genel. “There are subjective sites that people use to check out an apartment or a landlord where people post complaints, but that’s not always fair to a landlord who gets a complaint about not changing a light bulb when he was out of town.”

Genel’s app won’t necessarily prevent all renter fraud, but users can pay a flat fee to learn more about a potential landlord. 

“We designed the app so that renters don’t have to request permission from a landlord to run a check on them,” said Genel. “A renter just needs the name of the landlord and address of the rental, then we are credentialed and compliant with the Fair Credit Reporting Act to pull nationally available information on someone.”

MySmartRenter.com costs $19.95, $34.95, or $49.95 for different levels of searches, with the basic level verifying that the landlord owns the property being rented and checking the national sex offender registry and for civil court actions. Other levels include a criminal background check, bankruptcies, liens, and professional licenses. Parents of students renting off-campus housing can use the app, and landlords can proactively be certified by it.

The most important step any renter can take to prevent becoming a victim of fraud is to gather information about the local rental market and a specific rental, said Popov.

“Visit the property in person if you can,” he said. “Verify that the landlord owns the property by checking city records or asking the building manager. If someone tells you that you can’t see the property in person, then that’s a red flag that something could be wrong.”

Other potential red flags, said Popov, include a lack of photos or only exterior photos, prices that are not typical for the market, or requests for a security deposit made with cash or a wire transfer. It’s best to pay with a credit card or a check so the payment can be cancelled if necessary.

Renters must be vigilant and verify as much as they can about a rental before they sign paperwork or provide money. If you are victimized, you can report fraud to the Federal Trade Commission, local law enforcement, or the Massachusetts Office of Consumer Affairs hotline at 888-283-3757. 

Read the full article at http://realestate.boston.com/renting/2020/04/09/how-to-protect-yourself-from-renter-fraud/?s_campaign=bdc:hp:well:realestate

Beware Red Flags of Apartment Rental Scams During the Pandemic

Below-market rents, unusual payment methods are among the warning signs

Shutterstock

by Katherine Skiba, AARP, October 23, 2020 | Comments: 1

The scam starts with a “hijacked” ad for a rental apartment. A criminal steals an authentic listing and changes the contact information to his. Or creates a “phantom” listing for an apartment or condo that doesn’t even exist. With attractive photos, enticing amenities and below-market rental rates, the ads are clickbait for people searching for a place to live.

A 53-year-old property owner in Pennsylvania got an education on rental scams the hard way. A bad actor co-opted an Airbnb ad for the two-bedroom Philadelphia apartment the owner had on offer. The crook even rented the place briefly. But before he collected the keys, he copied the digital photos of the unit and advertised on another platform, looking for someone to sublet one of the bedrooms for a year, says the apartment’s owner, George Ryzinsky, president of DAN Housing in Southampton, which is in Pennsylvania’s Bucks County.

Three people took the bait, gave the fraudster a total of $1,300 in advance to secure the space, and on the same day — when all three showed up — were left with no place to stay, the owner says.

‘Spanked’ by fraudster

“We got spanked so bad on that case,” Ryzinsky tells AARP. He says he felt so sorry for the out-of-luck tenants that he put them up in a three-bedroom unit that he owns elsewhere and gave them a month’s free rent. Since then he has taken the jinxed unit off Airbnb and changed its locks.

Sham listings — and stolen ones — are a coast-to-coast scourge, by no means restricted to major cities with tight rental markets, news accounts show. Yet it’s unclear how widespread the problem is. Last year the FBI’s Internet Crime Complaint Center (IC3), which is accessible online, took in 11,677 reports on real estate/rental crimes with $221 million in losses, but the bureau does not break out the figures for rental-listing scams alone.

These cases are not always one-offs. In California, a group of people defrauded more than 100,000 would-be renters and homebuyers out of more than $25 million from 2009 to 2016, the Department of Justice (DOJ) said last year, when a second defendant in the case was sentenced to prison. Their victims, from all 50 states, included more than 100 people in southern Illinois alone.

A spike in cases amid the pandemic

During the pandemic, such scams have trigged more calls to AARP’s toll-free Fraud Watch Network Helpline, 877-908-3360. A few of this year’s cases:

• A woman in New York found a rental apartment in Los Angeles on Craigslist and lined up a friend to give it a once-over in person. But before the inspection, the New Yorker wired $2,000 in “rental fees” to a person who turned out to be a con artist. The sad truth: The apartment — a phantom rental — didn’t exist.

• A California woman found a “fantastic” place on Craigslist. The person behind the listing demanded $500 via Zelle’s instant payment app and the would-be renter complied. It dawned on her after she sent the money that it all was a sham.

• Another California woman found an apartment and applied for it online, giving her debit card information. On move-in day, she stepped into a mold-tainted apartment that needed remediation and other repairs. The unit wasn’t even in the advertised neighborhood. Her plan? To get out as soon as she could.

• A Texas couple saw a rental sign for a house they loved and were asked to send a security deposit using Zelle, and did; later they were asked for more cash for “rental fees” — and only then smelled a scam.

The federal government’s temporary halt to most residential evictions, intended to prevent the spread of COVID-19, is slated to end Dec. 31, and this could trigger a wave of people on the hunt for a rental — or roommate.

AARP’s Amy Nofziger, who oversees the helpline, says such complaints have risen during the pandemic. Scammers are online touting properties for rent “sight unseen,” saying prospective tenants can’t enter the premises due to COVID-19, she says.

That’s not exactly true, says Kelsey Blakely, senior director of online security for Apartments.com, which dates to 1995 and touts more than 1 million rental listings in the U.S. “If I was talking to you a year ago, I would say you always want to make sure that someone (offering a rental) will meet you in person,” she says. Now, instead, there’s a “huge increase” in virtual tours, such as 360-degree tours, prerecorded video tours and live, remote tours via FaceTime, Zoom and other platforms, she says. And many places offer self-guided tours.

During COVID-19, con artists — some of them overseas — have been inventing “sob stories” to excuse not meeting face-to-face, Blakely says. “They’ll say things like, ‘I have COVID, my wife has COVID, so I can’t meet you. I can’t videoconference with you.’ They really prefer to communicate by email and text.”

Even if you are allowed to visit a unit in advance, don’t let your guard down, says Blakely, since “we have had cases where people have physically toured a property, and then sent a security deposit to a fake landlord.”

Renters beware

Apartments.com does not divulge how often it finds fraudulent listings on its site, but uses security protocols to ferret them out and tells users to exercise caution. Blakely says the frauds comprise “quite a small percentage” of all listings, but acknowledges that no system is foolproof, as reflected in an Apartments.com disclaimer saying that it “cannot guarantee that our sites are 100 percent free from false or fraudulent listings.”

Fraudsters, she notes, zero in on people who are vulnerable or have an urgent need to move fast, such as divorcees, single parents or students.

At Airbnb, a spokesperson urged travelers to “help keep themselves, their payments, and their personal information protected by staying on Airbnb’s secure platform throughout the entire process — from communication to booking and payment.”

Airbnb will never ask travelers to pay for anything outside its website, such as via email or a third-party booker, the spokesperson added. Here’s more of its advice on security and scams.

Craigslist did not respond to AARP’s request for comment, but its site has this guidance about scams.

8 Red Flags of Rental Scams

Want to avoid a rental-listing scam? There is no one, easy thing to do. But industry experts say it’s critical to know the red flags.

1. A monthly rental payment below the market rate.

2. A listing with grammar or punctuation mistakes.

3. A landlord with a “dramatic” story. You might be told to drive by the building — but you can’t go in, because the owner is working abroad or is in a faraway place serving in the military or doing missionary work.

4. A refusal to speak or video chat, communicating only by text or email.

5. A request to wire money, send it via Western Union or MoneyGram or pay with gift cards or bitcoin. The funds requested may be called a security deposit, move-in fee or rent.

6. A sense of urgency. Scammers want you to act fast and move in immediately, even if you haven’t seen the premises. Some dangle the prospect of heavy interest from other prospective tenants.

7. A claim of affiliation with Apartments.com or another established site, which could be just another falsehood.

8. A hard sell. “Fraudsters are very persistent … they just tend to be a little more aggressive,” says Kelsey Blakely, senior director of online security for Apartments.com. “Once they get a hold of your number, they’ll just be texting you all the time. And it’s like, ‘Hey, what do you think? Want to get this deal going?’”

Read the article

How to Avoid Rental Scams Now That So Many Viewings Are Virtual

Published 8/23/20 – Elizabeth Yuko – Lifehacker

Photo: iJeab (Shutterstock)

Whether or not you’re a fan of attending virtual doctor visits or weddings, having these services and events accessible during a pandemic has been a game-changer. And while using real estate websites and apps to get a look at a property isn’t new, many parts of the process that used to be done in-person now take place virtually. It’s convenient, for sure, but it also opens up more possibilities for swindlers—especially in the rental market. Here’s how to spot and avoid their scams.

Don’t sign anything until you see the unit

In the midst of a pandemic, it makes sense that people are trying to avoid traipsing around an area looking at rental properties. That’s where virtual viewings come in handy—allowing you to rule out future homes that don’t cut it without having to see it in person. But once you’ve found something you like and are seriously considering renting, make sure to see the place in person at least once before signing the lease.

“I don’t think anyone should rent without seeing the unit,” Nadine Cohen, managing attorney in the Consumer Rights Unit at Greater Boston Legal Services told the Boston Globe. Yes, this helps you find out about things like bad smells and noisy neighbors that can’t be detected through an online viewing. But also, who knows if the photos or video tours are actually of the place that’s for rent (or even exists at all). The last thing you need right now is to sign a one-year lease on what appears to be your dream apartment, fork over the rent and all the fees, and then go to move in and find out that it looks nothing like what you were shown (or again, doesn’t exist).

Find out exactly who you’re renting from

Not only could a listing be fake, but the person purporting to be the owner, property agent or realtor may not be who they say they are. Before turning over any documents or money, Cohen advises “seeing some proof that the person showing it to them is either the owner or is a legitimate rental agent.”

But even if you are dealing with the actual landlord/manager/realtor, that doesn’t mean you’re in the clear—they could still be up to something shady. If this is something you want to look into further, there are sites like MySmartRenter, which allows renters to get information about prospective landlords. This service isn’t free—there are three packages that provide additional insight at a higher cost—could come in handy if there’s someone you’re really iffy about. (Their whole pricing model is here, but basically, it’s starts at $19.99 for their three-step verification process, as well as finding out if they’re involved with any civil court cases, and/or on the national sex offender registry.)

Be cautious of listings that seem too good to be true

Again, this should be the case anytime you’re looking for a place to rent, but be realistic about what you can get for your budget. Once you’ve been looking for a while and are familiar with the going rates in the area, it’ll be easier to spot a fake listing. So, if most run-of-the-mill one-bedroom apartments in the neighborhood go for around $1,500 a month, and you see a listing for a luxury building with a rooftop pool, gym and laundry in the building for $1,300, be careful and do some extra research.

What to do if you’ve been scammed

Scammers are usually good at what they do, so if you do end up finding yourself in a situation where you’ve been scammed, Cohen told USA Today that she recommends filing a police report, contacting whatever listing site you used, and filing a complaint with the Federal Trade Commission.

Read the article

Looking for an apartment or house to rent? That online listing may be a scam

Jan. 15, 2020, 5:34 PM EST By Herb Weisbaum

Most people looking for a place to rent start their search online. Internet listings provide a wealth of information beyond price — pictures, floor plans, amenities, perks and a detailed description of the property.

But many of these listing are bogus, created by scammers who hope to steal thousands of dollars in upfront fees for a place they don’t own or don’t have the right to rent. Some properties may not even be for rent.

A report from the Better Business Bureau (BBB) calls it a “massive” problem, that’s getting worse.

Read the article

Over 5 million renters have lost money in rental scams

Published: July 22, 2018 at 10:19 a.m. ET
By Jacob Passy

Nearly half of young renters say they have encountered fraudulent listings

An estimated 43.1% of all renters have encountered a suspicious listing in their hunt for new housing, a new report found. GETTY IMAGES

The three-bedroom home on Lexington Court in Largo, Fla., 20 miles north of St. Petersburg, looked like the perfect family home, with a nice front yard, central cooling and laminate floors. For 18 families, it turned it was too good to be true — and at a serious cost.

A married couple, Nicole and David Johnson, allegedly posed as the owners of the rental property, giving tours and collecting more than $25,000 from those families, local television news station WFTS reported in late June.

The home, it turned out, belonged to Nicole Johnson’s parents and was not available for rent. The Johnsons targeted the families using social media and by posting to Craigslist. Local police have called it the largest rental scam they’ve ever seen. Many of the victims only realized that the listing was a fraud when they showed up to the property on the same day and notified police.

Read the article

Is That Rental Listing Real? A BBB Study of Rental Scams Involving Apartments, Houses and Vacation Properties

By Better Business Bureau. December 10, 2019.

Introduction

Deciding where to move to live or stay for vacation can be exciting, but it raises many questions. What’s the rent? How much is the security deposit? Is it located in a safe area? What are the parking options? Is the unit close to public transportation? Does the property have a laundry facility? When you find an affordable rental home, apartment or vacation home that fits the bill, you may need to take action quickly before someone else gets the unit.

What many people don’t think to ask is if the unit really exists or is actually for rent.

Read the article

Scam Alert: Rental Cons Cash in on Stressed Out Movers

By Better Business Bureau. March 7, 2017.

This summer moving season approaches, BBB is seeing an uptick in reports of rental scams. Finding a new place to live is stressful, and scammers know that people in the midst of moving don’t always have time to do the necessary research. Don’t be one of them!

How the Scam Works:

You respond to an online rental listing that touts a beautiful home, low rent, and great amenities. It looks legitimate; con artists often use real photos and descriptions stolen from other websites. The “landlord” replies to your message claiming to be out of town and unable to show the property. One common scenario is that the scammer pretends to have been transferred suddenly for work.

The scammer will then create a false sense of urgency, telling you that others are interested so you must act immediately. They will ask for a security deposit and/or first month’s rent to reserve the property. The scammer may claim that you can see the property through a rental agent – only after you pay the deposit.  In some versions, the “landlord” will require prospective tenants to complete an application form, which asks for personal details like Social Security number.  No matter the details, once you send the money the result is the same. The “landlord” will stop responding to messages and disappear.  Your new home never existed.  

Read the article