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New and fast growing ID tenant scam affects agents and landlords – beware!

Property agents and landlords are being warned about a scam whereby phoney tenants take out tenancy agreements in blocks of flats where post is delivered and left in communal areas. The fake tenant then goes through the occupants' post, stealing their Ids and using their credit cards and banks to buy expensive goods.

The fraudulent tenant is likely to have provided convincing ID checks and reference to dupe unsuspecting landlords or agents and is likely to have paid the deposit and advance rent without any problem. However, the tenant's ID will in all probability have been stolen and the deposit and rent probably paid for via a debit or credit card which has also been stolen.

One property agent from the north has been hit by this scam. He moved a tenant into a property early in December. The tenant appeared fine and had no problem paying the monies required and there was absolutely no problem with references. All seemed fine. The first thing the agent heard about a problem was then the police called him to say they had found a set of keys belonging to his agency during a raid on another flat some ten miles away. During the raid police apparently discovered a large number of high value items including iPads and iPhones, apparently all bought with stolen credit and debit cards and awaiting export where they would be sold abroad. Big business! The keys were returned to the agent who confirmed they belonged to the flat he had let.

The agent was then approached once more by the tenant in question, who asked for another set of keys – claiming he had lost the first. Upon being told by the agent that the police would like to speak with him he fled in a taxi and has not been seen since! The police investigation continues.

In the block of flats concerned, the fake tenant had managed to steal the identities of three of the six occupants, causing untold distress. The agent has since been approached by the debit card company and told that their 'tenant' had paid by stolen debit card and that the true holder of the card had seen a large sum of money disappear from his account and wanted it refunding.

At the block of flats in question, the agent had put a 14 day abandonment notice on the flat concerned and changed all the locks.

This appears to be part of a huge and widespread fraud where a fake tenant enters into a tenancy agreement in the usual way for a property (either furnished or unfurnished) arousing no suspicions. However, the tenant stays only one or two nights until their purpose has been accomplished. This fraudulent activity is taking place all over the country and is a very slick operation, and can prove extremely expensive for those on the receiving end of the scam. Fortunately, in this case, the agent had organised comprehensive insurance cover for the landlord who will not be out of pocket as a result.

Agents usually have in place excellent checks on potential tenants and are now tightening these even further. Some are now insisting that if a tenant wishes to pay by debit or credit card that they go to the agent's office to do so – the logic being that if they do this and they have the person in front of them, they will be covered by the card provider's insurance. Most also insist on photo ID and will not make any exceptions.

Tenant fraud is a fast growing problem. Fraudsters provide false information and they move from property to property with no intention of keeping up with the rent. They can throw tenant refereeing companies off the scent and they seem to know their way around the legal system, thus making them difficult to evict.

Agents are advised to be alert for anything suspicious or unusual which could increase the risk for the landlord. If an agent has any doubts he should talk to the staff at letting insurance firms. They are removed from any personal contact with the prospective tenant and are trained to spot anomalies, oddities and potential opportunities for fraud.

If, as a landlord or agent, you have any queries about insurance relating to tenancy agreements then speak with a professional. Westhill Insurance Services has vast knowledge of the property market and are used for dealing with properties which are rented. Their professional and friendly team can advise on the best possible type of insurance for the building, its contents and also look at the cover required to avoid potential problems caused by the fraudulent activity of others.

It pays to make sure you are covered. It is sad that we can no longer take people at face value. Call Westhill Insurance Services and receive honest and sensible advice and stay one step ahead of the trouble makers out there!

Contact Westhill Insurance Services, today.

Posted on 6th March, 2012