HousingLink Blog
Landlords - Look Out for Fraudulent Resident Applications
Mar 7, 2018, 10:15 AM
by
Josh Dye
From Rental History Reports on February 16th, 2018:
We have experienced an influx of fraudulent applications within the Twin Cities market over the past 45 days that we want to make you aware of so that you can strengthen your policies moving forward.
What we have noticed:
- Applicants using online leasing portals (specifically Yardi, so far) to submit fraudulent applications – typically providing incorrect variants of their real names, SSNs and DOBs.
- Applicants providing fake employment and rental references, often with phone numbers that show up on “escort/massage” ads on sites like backpage.com if you reverse-search them.
- In many cases, the applicant’s own contact number also leads to ads on backpage.com.
What you should consider:
- There are many reasons someone would falsify an application – poor rental history, a record of evictions, etc. – but you should also be aware of a growing demand for illegal “in call” prostitution services. Prostitution and sex trafficking rings need places to invite customers to, and rental apartments are often more attractive to them than hotel/motel rooms. Demand increases during big events like the Super Bowl, so Twin Cities area customers especially should be on the lookout for suspicious activity.
- These applicants are getting smarter and adapting their behavior based on background screening practices. For example, we’ve noticed they have begun providing addresses that do not exist to prevent us from being able to research and call the legal property owner for a reference.
What you can do to prevent fraudulent applicants from being approved:
- It is imperative not only to check an applicant’s government issued photo ID prior to signing a lease, but also to compare what is on that photo ID to what was provided on the application form – whether that was a paper application or an online application.
- If the spelling of the name, the date of birth, the ID number and/or the address on the ID do not match, STOP the leasing process and obtain an updated background report using the information on the ID.
- Look for flags on the background report. If there is a warning that an applicant has no credit file, confirm the information the applicant provided. A very young adult or a recent immigrant probably wouldn’t have a credit file yet, but almost everyone else should. If the legal owner of a property has no record of an applicant, but the applicant gives an “alternate” contact who provides a reference, that reference may not be accurate.
- Strongly consider whether you want RHR to utilize applicant provided contact information. We perform research on things like property ownership for a reason – to protect our customers from falsified references.
- While the applicants we’ve noticed up to this point seem to be providing variations on their actual information, there is good reason to anticipate an uptick in the number of applications submitted using someone else’s data entirely, especially in the wake of the Equifax breach.
Additional services RHR is able to offer to prevent fraud:
- Consent-based SSN verification
- Cross-checking photo ID uploads against what was entered by an applicant
Services in development that RHR will be able to offer:
- KIQ at time of application within RHR’s “Apply Now” on-line application portal
- KIQ, or Knowledge IQSM is a revolutionary knowledge-based authentication tool for identity authentication and fraud prevention. Knowledge IQSM interactive challenge-response questions provide innovative and integrated identity authentication and fraud detection on a single platform. By utilizing the sophisticated challenge-response authentication questions, you have a comprehensive risk-management and identity authentication system.