Fake rental applications on the rise as fraudsters up their game

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The number of fake or fraudulent rental applications is on the rise, with landlords and letting agents being fooled by a range of tricks.

According to data from referencing firm LetRef, the number of fraudulent applications, using either fake bank statements and fake or cloned employers in order to pass referencing checks, has increased to an average of 13 cases per month in 2019.

This is up from an average of six fraudulent applications per month in 2018, equivalent to a rise of 117%.

With the recent introduction of the Tenant Fees Act, which bans agents from charging tenants for references, it is expected the number of fake applications will increase as tenants know they won’t have to pay if they fail a referencing check.

LetRef reports that in June, when the Act was introduced, the number of fraudulent cases increased further to 16.

Meanwhile, London letting agency Benham and Reeves – which commission the research – says that the number of fake passports being used by fraudsters is also rising.

The agency says that it experienced a total of five cases of fake passports in 2018. However, in the first five months of this year, it had already dealt with 11 cases.

It says this is down to expert forgers knowing the code formatting required to pass an anti-money laundering check

“This surge in fake applications demonstrates the importance of using a bonafide referencing company, where staff have been given specialist training from the National Crime Agency on recognising fraudulent documents,” says Marc von Grundherr, director of Benham and Reeves.

“Unfortunately, the majority of referencing companies do not even collect ID and proof of address and conduct referencing as a side-line, in order to up-sell other services and earn commission.”

“Letting agents using one of these companies or making checks themselves are highly likely to end up with these fraudulent chancers flying in under the radar and into a rental property,” he says.

“It’s the professional duty of all agents to properly validate the tenants they are providing to their landlords and failing to do so with the utmost vigour simply isn’t acceptable.”  

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Written by: Houseladder