Tag Archives: Rental Scams

How NOT to rent a home

Let’s say you’ve just got an excess of money in your life, and you’re tired of it. To remedy the situation, you decide to lose eleven or twelve hundred dollars to a con artist.

Now, how should you go about it? Eureka! To Craigslist!

Start looking up rental properties on Craigslist and find a few you like. Start contacting property owners until one instructs you to drive by the house and check it out. The owner himself can’t be there to show you around the place because he’s on vacation overseas. However, if you like the look of the place, you can just send a check for the first month’s rent to his vacation address (or wire the money).

Follow his instructions to the letter, and hey presto! you’ve just lost several hundred bucks! The person on the phone never did own the house, and in fact has just lifted photos from a legitimate rental advertisement.

Naturally, nobody actually wants to lose money to a scam, so what I’m really saying here is don’t do any of the above.

Okay, fine, you can look for apartments or houses to rent on Craigslist. That, in and of itself, isn’t a mistake. However, if you find one you’re interested in, absolutely refuse to hand over money unless the property owner agrees to meet you there in person, has a key that opens the door, shows you the inside, and can prove that the property belongs to him or her. (You still might want to bring a friend with you, because there are other, non-financial risks associated with meeting a stranger.)

Also, never hand over money until contracts have been signed and everything is official and legal.

With the kind of scam described above, you have to consider three questions: first, why would you agree to rent a house or apartment, mostly sight-unseen (except for the outside)? What if you find out there’s no kitchen and the only toilet is right in the middle of the bedroom?

Second, why would they agree to rent a house to you, sight-unseen? There are people in the world who just wreck stuff. Any owner renting out a property is going to want to feel you out in person and make sure you at least don’t seem like the type that’s going to cut a hole in the living room wall with a chainsaw three days after you move in.

Third, if the house is locked up and the owner is supposedly on vacation overseas, how’s he s’posed to give you the key?

Fraud Prevention Templates: scams involving money wiring.

I’ve written upwards of 140 posts about scams, fraud and identity theft since last July, and it seems like there are a lot of schemes that are based on the same idea, only with different details.

For example, consider these two scenarios:

  1. Rental Scam: a landlord is sent a cashier’s check for far more than the first/last month’s rent and security deposit. The crook tells the landlord to just wire the overage back to him. Later, the check is returned as fraudulent.
  2. Mystery Shopper Scam: a job seeker is sent a cashier’s check and instructed to cash it and wire the funds back, allegedly to check out the customer service at Western Union. Later, the check is returned as fraudulent.

They’re two different scams, but they hinge on that counterfeit check, and they both involve wiring money. So let’s extract a general rule of thumb here, a Fraud Prevention Template:

Anyone who sends you a check and instructs you to cash it and wire money back to them is attempting to commit fraud.

That’s it. If you’re in a situation that involves a check and wiring money back to the maker of that check, you’re about to become a victim of fraud if you continue. The actual context doesn’t really matter.

Someone contacts you via Craigslist to purchase an item you’ve listed. They send you a check for $2,000 more than you wanted for the object. They tell you to just cash it and wire the funds back. It fits the template.

You get a letter that says you won the Canadian Lottery, but you have to pay taxes and fees first. The letter includes a check with instructions to cash it and wire the funds back to them. It fits the template.

The best part of keeping this one simple rule in mind is that you don’t even have to carry any other information around in your head. You don’t have to know that a legitimate lottery never asks winners to pay in order to claim a prize, or that you can’t win a lottery you never entered, or that it’s illegal to play foreign lotteries—you’ve got a check in your hand, and some clown is telling you to cash it and wire the money back. You know right away you’re dealing with a con artist. Fraud averted.

I’m going to come up with a few more of these templates over the next few weeks. It’s a lot easier than trying to memorize the details of every little variation.

Don’t worry, though; I’ll still be on the lookout for all those variations to write about, too.

Avoiding real estate and rental scams.

Rental and real estate scams seem to be on the increase lately. Maybe they’re just getting more attention, but if they’re anything like every other scam in the universe, they proliferate in a rough economy.

There are versions that target both owners and renters.

For example, if you’ve got a property to rent out, you might be contacted by a party who claims to be interested. They will either send you a cashier’s check (first and last month’s rent, deposit, etc.) for far over the amount you’ve asked, then ask you to wire the remaining funds back to them, or give you a check then pretend to back out of the agreement later.

In this case, remember first that anyone who gives you a check then tells you to wire some or all of it back to them is attempting to commit fraud. I have yet to come across an exception to this rule. Also, if you’re renting out a property, only deal with people you can meet in person, verify their identification, and do all the credit and other checks you’d ordinarily do.

If you’re attempting to rent a property, the scam usually involves people who claim to be landlords but aren’t. You have to verify that a property is in fact owned by the person you’re talking to. Just having the key doesn’t mean anything—sometimes this scheme is run by former tenants. Ask to see the landlord’s ID, and use local websites or other resources to verify that you’re dealing with the real owner.

As a final tip, just be beyond cautious if you’re using Craigslist for renting out a property or finding a place to rent.

The IC3 has some additional information, and this site goes into even greater detail. Whichever side of a rental situation you’re standing on, it pays to stay vigilant.