Legal Q & A Spotting Fraud in Rental Listings – By Franco Simone, Attorney

 What are the warning signs of fraud in renting? [i]

1. 1.      If the tenant did not provide a Social Security Number or provided a false or wrong one, thereby preventing a credit check.
2. 2.      Emails are overly polite, poorly written and express excessive eagerness to rent site unseen.
3. 3.      Tenant does not send funds as promised or delays providing information.
4. 4.      If the tenant expresses extreme urgency throughout the course of correspondence.
5. 5.      Email is sent from another country or the tenant claims to be a reverend or works for the World Health Organization (WHO) and is out of the country OR if the tenant claims to live in one   country but the email is sent from another without adequate explanation.
6. 6.      If the tenant asks you to not cash a rent or security deposit check or asks you to purchase services on their behalf
7. 7.      Never provide a bank an account number, bank routing number or other financial or personal information.

What are commonalities in rental scam emails? [ii]

1. 1.      The email starts with Sir/Madam.
2. 2.      There are excessive misspellings in the email.
3. 3.      There are character mistakes.
4. 4.      There is excessive capitalization.
5. 5.      The email references the UK, Cashier’s Checks, Doctor, Nigeria, Reverend.
6. 6.      The email is from a free provider.
7. 7.      The email refers to another person or agent.
8. 8.      The email references wanting to move in site unseen.

How do I to report a rental scam?[iii] 

Oftentimes, sites such as Craigslist, Zillow, and other popular listing sites will have a button or link to click that will report the listing as fraudulent. If you find yourself victim of a rental scam you may contact the local authorities and the Federal Trade Commission (FTC). A complaint may be filed with the FTC online at www.consumer.ftc.gov/.

Rental Scam tips for property owners:[iv]

Many unpleasant situations can be avoided by landlords getting to know their tenants before the lease is signed.  Screen your tenants during the application process. Ask tenants for references and follow through by calling those references. You may also simply type their name into a Google search and look for prior addresses, phone number and police records. Contact your tenants’ employer to verify employment and run a credit check on tenants before renting to them. Do not let a tenant pay more than is due, then demand a refund. Remember to have the locks changed after tenants move out. If the locks are not changed, the previous tenants may have access to the property.  These steps will help to ensure that you will not be scammed.

What are some possible scams that I should be aware of?[v]

Renting with the intent of renting to others: A scam artist may rent a property so they can scam other renters. They will rent a property, then advertise the property as a “for rent” listing, representing themselves as the landlords. The rent will be low, well under value for the area the property is located. This is done to attract multiple tenants. They will then typically collect first and last months’ rent, security deposits and any other fees or charges that they can make believable. They will continue to collect security deposits, first and last months’ rent from several other prospective tenants, usually, until they get caught.

Renting on behalf of the owner: The scammer claims to be helping the owner rent out the property. Common excuses for this are that the real owner is sick, out of town, overseas or too busy to do it themselves. The scammer will then collect first and last months’ rent and a security deposit and then bail with the money. Often times the house is not even for rent. It may be a vacation home, a foreclosed property, or the owners or renters are just out of town.  

Internet Rental Scams: This scam can target both property owners and renters alike. These scams takes place over the internet. One variation includes a person finding a picture of property and its address, they will then post the photos on craigslist or other rental websites along with a listing. They will again ask for first and last months’ rent, security deposits and other fees to be wired to them. The property will usually be listed under fair market value and will seem like too good of deal to pass up. This is done in order to create a sense of urgency for the prospective tenant or buyer, making them more susceptible to the idea of wiring money to an unknown person.

The other variation of this scam is against property owners. A perspective tenant will contact the landlord about the property. They will then submit payment, which is greater than due, through a money wiring service. The tenant will then apologize for the mix up and ask for the excess funds to be returned to them. Usually the first payment is fake, or there are not sufficient funds, and the landlord is out the money they returned.  [vi]

What are some ways to prevent a hijacked listing? [vii]

The National Association of Realtors has tips for protecting your listing, including using Google Alerts, Google Image search and setting up an “If This Then That” (IFTTT) recipe. Google Alerts and IFTTT will provide you with alerts when a phrase, such as the address, appears on the internet. In order to ensure that craigslist is included in this search, look up the advertisement that has been placed regarding the property on Craigslist, copy and paste that URL into the search or query box on Google Alerts. This will ensure that you will be notified if the address of your property appears on craigslist. To use Google Images open up the listing and drag the photo of the house or apartment that is associated with listing, to the Google search bar. A list of every place that image appears online will be shown. In order to use “If This Then That” you must create an account. IFTTT is more effective when wanting to monitor craigslist advertisements or postings. By creating an IFTTT recipe you will be notified every time your property address or the listing appears on the site.

What are methods that could protect me from being the victim of a rental scam?[viii]

Limit the information that is put on the internet that pertains to yourself and your properties. In the listing, post the intersection instead of the full street address. If a perspective tenant is serious about the property they will call. Never use your cell phone or home phone in rental ads. Consider using free options such as Google Voice to receive calls without giving away your number. Using a generic email or taking advantage or Craigslist’s anonymized email are other possible options to limit personal information being given out. Water marking photos is one way to combat picture theft and having your listing hijacked. There are free online versions and various watermark software programs that allow you to mark your photos. This will allow for those viewing the listing to detect if they are fraudulent. If the watermark does not match the company name in the listing, it may be a red flag to consumers. This also allows people to notice the listing is fraudulent and report it.