£22 million lost to rental fraud

Rental Deposits And Other Letting Frauds 

During the pandemic, rising unemployment and decreasing affordability amongst renters led to the loss of rental income, impacting landlords. Some landlords favoured softening eviction regulations where the landlords had less power to evict a tenant. However, there is no regulatory support against fraudulent lettings and rental applications. 

Some genuine letting firms get a huge number of fake applications. If the landlord approves the applications where the prospective tenant has no legal right, it can lead to fines of up to £3,000. There can be other legal costs; in worst cases, the renter loses the holding deposits.

Rental frauds are committed when the prospective tenant pays an upfront fee as a deposit for a non-existent property or has been rented to multiple parties simultaneously, and the tenant loses the deposit. 

How Does It Happen?

In such cases, the adverts posted by the letting sites appear legitimate as you see photos and contact information of the agency. The prospective tenants are asked to pay a deposit to the agent. University students often get messages from fake letters offering local accommodation only to access the upfront deposit. 

In the case of students, they get income through student loans, but such loans have dropped since 2020, and the parents pay for the financing. 

Many university students whom the criminals defrauded said they suffered health and financial problems after losing money through accommodation deposit scams. All students seeking university accommodation are alerted to take steps to ensure the property they intend to rent is secure. 

The cases also increased when holidaymakers chose to rent apartments instead of hotels to avoid social interaction during the COVID crisis. 

Some online lettings have a section devoted to consumer complaints and reclamation to reduce such irregularities, but criminals have been extracting deposits and documents from the victims through fake adverts.

How To Spot A Fraud?

The trickster posts adverts of non-existent properties to pocket deposits, using methods like phishing posting to collect data from interested parties. Often, the person may get a house on rent in more hazardous conditions than advertised.  

If the money has already been given for it, the firm does not allow the buyers to reclaim their deposits, and the victim will have to report the case to the local cyber crime department to register a grievance.

Even when the apartment is not in proper condition and is rented without intermediaries or the letting agency, the client can request the owner directly for reclamation. They may be asked to provide proof and pictures of the internal condition of the house.

Steps To Avoid It

• You should always check the property by visiting the site. 

• Watch out for the adverts that post no pictures or photos that do not reflect the real condition; instead, you should always request a detailed photographic report from the owner or the agency. 

• Get cautious if you see multiple adverts for the same property on the same site. It would be best to approach negotiations through a reliable agent or a known landlord. The agent must ensure the new tenant's credentials and the landlord's approval of a legitimate person.

• You should spend money carefully. Make payments through credit/debit cards to ensure you know where and how the money is transferred from your account to the other account. Avoid transactions that appear unreliable, like wired or crypto.

• Always try to gain information about the property owner and the accommodations approved on a trusted authorised site. Check the accommodation approved by the student union site or accommodation offices of the universities. Check the accreditation membership of the property agent.

How To Proceed?

• Before renting, compare the conditions and prices with other websites. Check genuine reviews. The low-price options often have low flexibility. One should take cancellation insurance and always search for authentic comments from previous users. Be careful to deal directly with an unknown individual; opt for an intermediary instead. 

• Get in-depth information about the surroundings location and also ask questions about the condition of the appliances and furniture. Then, inventory all the appliances before entering/leaving the home. If the landlord asks for possible damages, ensure you pay for the exact condition of the instrument. 

• Negotiate the price and conditions and get the contract in writing before signing. 

• Check the legal validity of the documents offered by the owner. 

• Before signing, clarify your doubts about the social needs, cancellation, dates and other aspects. 

Confirm the payment method, and ask for an emergency phone number in case of breakdowns or issues. Keep multiple copies of the documents, reservations and deposit proofs. If you suspect a transaction, report it to the cybercrime regulatory body / Action Fraud.