Canada's Condominium Magazine
Never send cash or personal information via email or text message unless you are absolutely certain of whom you are communicating with. We hear this advice over and over again, yet countless fraudsters and scam artists all over the world rely on, and profit from, our failing to heed it. As a result, the news is full of stories told by red-faced victims, like the woman from Raleigh, North Carolina, who sent first and last month’s rent to a man she thought had advertised an apartment for rent on Craigslist. He had insisted that all communication be by email and text, which should have been a large red flag, but the woman went ahead and sent him the cash. He was, of course, a scammer, and she lost her money, an all-too typical outcome.
Today the RCMP’s Financial Crime Unit announced that they had charged eight men with rental fraud in Ontario. The men had posted ads for cottages in popular vacation areas on online classified websites. As usual, they would communicate with their victims only via email or text. The victims thought they had rented a nice cottage for a couple of weeks, sent money via email money transfer, then showed up for their cottage vacation, their cars packed with holiday gear and family, only to find they’d been scammed. The cottages, needless to say, did not belong to the men who had posted the ads. At least seventy-five victims fell for it, with a total loss exceeding $68,000, says the RCMP.
To show just how careful a person has to be, some of these scams really do appear legitimate. One woman in the Trenton, New Jersey area found a home for rent on the reputable real estate sites Zillow and Trulia. She even met with a man posing as a broker for the property. But the red flag should have gone up when it came time to hand over the $1,300 deposit; he demanded cash, not a money order. She moved into the home, but was soon evicted. She did not recover the $1,300.
Between January and March this year, the Canadian Anti-Fraud Centre in Ottawa received 139 reports of online rental scams, though that is probably a mere fraction of the incidents that occur. The senior fraud specialist at the centre, Daniel Williams, says the most important thing people can do to protect themselves is “verify, verify, verify.” The best way to do this is to find someone else who has rented from the same person or company before. Of course, that can turn out to be a fool’s errand too. A woman seeking to rent an apartment in Whistler, BC, asked the owner for references and got three. All three responded positively to her emails. Thinking it must be legitimate, she sent the man the money. It wasn’t.
Never pay with cash
As rent scammers almost always ask for cash up front for a security deposit or first and last month’s rent, renters are advised not to fall for this. The best bet is to pay with a credit card. Credit card companies have “tremendous power” to get money back most of the time, Williams told CBC news, while money sent via wire service or e-transfers is “as good as gone.”
Of course it is always best to actually look at the place one is hoping to rent, though even that isn’t always enough. There are many reports of elaborate ruses in which fraudsters go so far as to stage a showing of the property, even with someone posing as a landlord.
Time can be an enemy as well. People who are in a hurry to rent tend to take fewer precautions, make more mistakes, and get scammed more often. Fraudsters often ask for would-be tenants to transfer money into their bank account as a security deposit before showing the property, upping the pressure by saying there are other renters interested. This is a good indication that the whole thing is a scam.
The best advice is to slow down and do not overlook your gut feelings when assessing an online offer. If a supposed landlord dodges your questions, makes excuses for not showing the property, or insists it’s too good an offer to pass up, it’s likely a con. Walk away from it.
In England, where incidents of rental fraud have been increasing at an alarming rate, there is mounting pressure for rental websites to protect users more. Rental sites, says the Residential Landlords Association, have an obligation to show due diligence to establish that a property is valid, that the person advertising it is the real owner. Warning messages should also be included, telling people never to hand over money before at least viewing the property. Renters are advised to go so far as to check with the Land Registry office to verify that the landlord is the legal owner of the property. They should also look for a landlord who is a member of a professional body, and registered with a tenancy deposit scheme.
Again, never send or hand over cash, and only pay when you have a written contract in hand, and you have verified it.
Anyone who falls victim to rent fraud in Canada can contact the Canadian Anti-Fraud Centre at 1-888-495-8501 or at www.antifraudcentre-centreantifraude.ca.