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Is That Rental Listing Real? A Study of Rental Scams

Deciding where to move to live or stay for vacation can be exciting, but it raises many questions. What’s the rent? How much is the security deposit? Is it located in a safe area? What are the parking options? Is the unit close to public transportation? Does the property have a laundry facility?

When you find an affordable rental home, apartment or vacation home that fits the bill, you may need to take action quickly before someone else gets the unit.

What many people don’t think to ask is if the unit really exists or is actually for rent.

Millions of scam listings for apartments, houses and vacation properties dwell online. Property owners regularly report to Better Business Bureau (BBB) that people show up thinking they have a place to stay because they paid money up front and signed an agreement, only to learn that they have been a victim of this cruel scam.

More than 5 million people lost money to rental scams and 43% of online shoppers encountered a bogus listing, according to a recent survey by Apartment List. With fraudulent listings so common, anyone doing an internet search to locate a place to rent faces a high risk of encountering a bogus listing.

In perhaps the most common type of fraud involving rentals, scammers simply copy the photo and description of a property, post it online with their own contact information and try to get a deposit and first month’s rent from the victim.

The National Rental Homes Council, a trade association of those who own and rent houses, reports that they hear about these scams regularly from property owners and that it is of growing concern to them.

Since it is unlikely that travelers will be able to inspect a vacation rental in advance, many turn to sites like Airbnb.com, VRBO.com or HomeAway.com to connect with property owners and pay using a secure payment system. But travelers still need to watch out for pitfalls associated with this industry to avoid arriving at a distant location, only to find their money gone and with nowhere to stay.

How common is this scam?

The Apartment List survey of rental scams, conducted by Igor Popov, a Stanford University-trained economist, found that 85% of those encountering bogus listings did not fall for them. Of the 5.2 million people who did lose money, the median loss was $400, and one in three victims lost more than $1,000.

These numbers suggest a tremendous volume of bogus rental listings lurking on the internet. Kijiji, an online classified ad service in Canada similar to Craigslist, says one of its biggest challenges in fighting fraud is screening fake rentals. A Federal Trade Commission (FTC) case against Credit Bureau Center notes more than 2.7 million people who clicked through fake listings were taken to the website of a deceptive credit monitoring service. No apartments were really available for rent.

Another method of gauging the frequency of rental scams is to look at how many complaints they get from fraud victims. This only produces a very rough measure, since many people file complaints with local police, and those generally do not go into the national databases of the FTC, the FBI or the Canadian Anti-Fraud Centre. And like many types of fraud, most victims blame themselves, want to forget about the unpleasant experience and never complain. In one FTC case involving fake listings, the FTC had identified 500 complaints at the time it filed the case, only to learn later that there were really 168,000 victims. But some numbers are instructive. Complaints to BBB Scam Tracker have increased over the last three years.

The FBI’s Internet Crime Complaint Center (IC3) tracks rental fraud, but timeshare complaints are included in the category containing phony rental listings, making it difficult to separate them. But from January through Oct. 20, 2019, IC3 reports: “The loss associated with the complaints that mention the term ‘rent’ is $37,561,457.61.”

In spite of the efforts of rental platforms to screen for bogus rental listings and alert users to fraud attempts, huge numbers continue to appear on the internet, and millions of people lose money to them each year.

Who are the victims?

Evidence shows that younger people are most likely to be victims. They have less experience in renting. The Apartment List survey found that those who are 19-29 are 42% more likely to be victims.

Younger people also report more rental scams to BBB’s Scam Tracker than do older consumers.

What cities see the most rental fraud?

Not surprisingly, the largest number of BBB Scam Tracker reports come from the largest metropolitan areas. The top three are Los Angeles, New York and Chicago. Additionally, there are more complaints from cities that are growing rapidly and where housing is more expensive and harder to find such as the San Francisco Bay area, Denver, Phoenix and Seattle. But rental scams operate everywhere in the U.S. and Canada. No town or city is safe from this activity.

Where do victims find bogus rental listings?

Though newspaper classified ads have not disappeared, people are more likely to turn to free classified listing services such as Craigslist in the U.S., Kijiji in Canada, or Facebook Marketplace. There are large numbers of websites connecting renters with property owners or their property managers, including Apartments.com, Zillow.com, Trulia.com, Realtor.com, and Homes.com, all of which warn about rental scams, as does the FTC.

Rental postings can be copied from one site and the photos and descriptions used to invent bogus listings at another. Most sites use algorithms and filters to try to remove scam listings. Because those tools are proprietary, there is no reliable method of determining which are most successful in keeping scammers off of their sites. But the technology used to screen bogus rental listings can be evaded or circumvented by smart and determined scammers.

Those who want to rent should act with caution. People can check out companies offering rental listings at BBB.org. One property owner told BBB he had encountered several situations where scammers had taken pictures he had posted and used them in rental scams. He began putting a watermark on the photos, and after that, he had no more problems.

Craigslist Rental Scams

Perhaps the most common place people go to for rental listings is the world of online classified ads.

Craigslist is one of the first places many people go to look for rentals. It is free and relatively easy to use. Those who want to post an ad simply go to the site for their area and open a free account. One simply has to provide a description of the property, the rent requested, a few photos and contact information. Craigslist is organized by city or region, allowing users to concentrate on a local area. But anyone can create an account, and they need not be in the city where the unit is to be rented.

Craigslist is regularly used by scammers. In 2016, researchers at New York University (NYU) released a study of rental scams on Craigslist. They found that Craigslist does try to screen potential rental listings, both before they are posted and after they have gone “live.” Of the 2 million ads examined, they identified 29,000 scam rental listings and found that Craigslist flagged 6% of rental ads for removal.

Other Online Classified Ads

Kijiji is a similar online classified marketplace operating in Canada. Kijiji says that rental is one of the major types of frauds they see, and they constantly work to keep fraud off of their platform. As with Craigslist, those posting items have to have an online account, and Kijiji tries to keep scammers from opening accounts through the use of algorithms and filters. If ads are in a high risk category, like rentals, they may delay posting them until they can look at them more closely. Of the 1.3 or 1.4 million new posts they see every week, they delay about 10,000 posts and find that only 100 (1%) of those are scams. They take down scam ads they identify, though they recognize that some scam ads will evade their efforts. Kijiji issued warnings about both real estate scams and vacation rental scams. The company strongly encourages the public to let them know about scam ads.

Facebook Marketplace allows renters to search for listings in particular areas. Consumers tell BBB they have found scam listings on the site. Facebook Marketplace says they proactively view listings for a wide range of scam behavior before they are listed and reports of scams are investigated and actions taken. In addition, each rental listing has a drop-down menu in the upper right hand corner with options that allow viewers to report it as a scam. Marketplace offers information about how to report a problematic listing and offers tips on how to stay safe using their platform.

Types of common rental scams

Three of the most common scams involve fake listings are designed to:

Fake listings to obtain up-front money

Perhaps the most common fraud potential renters will encounter are fake listings of apartments or houses for rent, where victims never meet the scammer in person.

A scammer can copy a home’s description and photos from a wide variety of websites that list properties for sale or rent and then post it with the scammer’s contact information. The scammers often advertise the rent at below-market levels. Those looking for the best price are likely to be attracted to the bogus listings. If renters are planning to move to a new city and cannot travel to inspect the unit in person in advance, they may be especially vulnerable to this type of fraud.

The content and grammar errors in the emails vary, but they have some things in common.

They often claim that the owner has had to move somewhere else in the country because of the illness or a mother or other family member. This helps to explain why they can’t show the unit in person.

They typically profess a strong Christian faith, suggesting that they are moral and trustworthy.

They often tell potential tenants to ignore “for sale” signs at the house, presumably because the listing has been taken from sites that advertise houses for sale.

Scammers want potential renters to complete rental applications, and they may send a professional-looking lease agreement to sign and return. These documents help enhance the credibility of the claims.

The scammer then needs to obtain money from the potential renter. This type of fraud will rarely, if ever, accept a credit card, which would offer some protection to the potential renter because they can ask for a refund (a chargeback) from their credit card company if there is fraud. Instead, scammers have ready excuses as to why the money must be sent by Western Union or MoneyGram, which are essentially the same as sending cash, or by wire transfer into a bank account proposed by the scammer.

Other payment methods employed by scammers include asking people to buy gift cards, doing bank-to-bank wire transfers into “money mule” accounts controlled by scammers, or using prepaid cards such as those offered by Green Dot. There has also been an increase in scammers obtaining money through Zelle, Venmo,or other payment apps. Requests for money by any of these alternative payment methods, especially from someone you don’t know, may be a strong indicator that fraud is involved.

After victims send money to the scammer, the supposed property owner simply disappears and stops responding. Many victims appear at the unit they believe that they have rented, only to find that the unit does not exist, is owned by someone else and who is not renting it, or is vacant and for sale. Landlords or property owners regularly encounter victims who contact them, thinking that they have a rental, and report this to BBB.

Bogus listing to sell a directory of rental units

The NYU study also found that scammers copied listings of actual houses and other rental units, posting them on Craigslist at cheaper prices and provided a phone number to call for more information. Callers were told that to view the details of the listing, they had to pay to join an online service which had a directory of low cost rent-to-own houses. They found that victims typically paid a one-time fee of $200 or a $40 monthly fee. The advertised houses were not for rent or sometimes did not exist.

Bogus listing to trick victims into signing up for credit monitoring

The NYU study similarly found a large number of bogus rental listings on Craigslist in which those responding to the bogus listings were told that they must obtain their credit score before they could see the unit in question, and were provided a link to a website where they could obtain their “free” credit score. But the credit score was not free. There were monthly recurring charges that victims had to pay but that were not disclosed. And when a victim did pay, they never got a tour of the rental unit because none of them were legitimately available for rent.

Other apartment/house rental scams

Scams also may target property owners. Someone may contact a property owner, especially a vacation property, offer to rent, and send a corporate check as payment for the rental. Not long after the check arrives and is deposited, the scammer contacts the property owner to cancel due to an emergency, and ask the owner to send back the money in a bank-to-bank wire transfer. Typically, the owner deposits the check and the bank credits it to their bank account, only to learn later that the check is counterfeit. Crooks can also counterfeit cashier’s checks, and those can bounce, too. This type of fraud is explored in BBB’s study on fake check fraud.

A variation on this scheme is to send the property owner a check for more than the amount needed, then ask them to send the difference to a supposed third party.

Scammers also may reach out to those who have timeshare properties and offer to rent them out for a corporate event. But the owner must first purchase insurance to cover the event, and the funds sent for insurance actually go to the scammers.

Vacation travel

Many people love to travel. Instead of staying in a hotel, they may want to rent an apartment, villa, or house. Those offering such rentals may have their own web pages. And there are online companies that connect travelers with property owners. Whether they are traveling to Branson or Barcelona, travelers are often in the situation of not being able to view the location in person before parting with at least an advance deposit.

The same tactics used in apartment rentals may be employed to scam someone with a vacation rental, so the same red flags apply. BBB has received numerous reports of people who arrived at a vacation property with their families and luggage after having made advance payments only to discover that the location doesn’t exist or is not available for rent, leaving people stranded with nowhere to stay and finding that their money has disappeared. BBB and the FTC have issued alerts and tips for vacation travel. It is important to know that trip insurance may not cover fraud.

Because renting a vacation property entails such risks, several services have emerged to protect both the renter and the property owner, including Airbnb, HomeAway.com or VRBO.com. (HomeAway and VRBO share a common owner.) Many other websites operate similarly. Most major travel booking websites offer protection from scams and ways to protect payments.

Airbnb says it works hard to keep scammers off of its sites, but the scammers are smart, experienced, and determined. There are several scams that consumers may run into on vacation rental platforms.

  • Scammers may manage to sign up as hosts themselves and post nonexistent properties. One victim told BBB he was planning to make a trip to London. He was initially interested in six different locations, which he found on several vacation travel sites. After some careful internet research, he concluded that five of the six were scams and the units were not for rent. In fact, one was a restaurant, he said. An internet search of the address can help determine if the property exists.
  • Scammers (or hosts acting improperly) may contact potential renters and suggest that they can give them a lower price if they drop the Airbnb reservation and deal directly with the host. Because many local governments now tax Airbnb rentals, evading these taxes can save some money. And crooked hosts could suggest that renters pay through a mechanism such as Western Union or MoneyGram, which is akin to sending cash with no protections for the sender. Airbnb warns, as does HomeAway.com, that vacation travelers who allow themselves to be moved off the platform lose critical protections for their money and risk arriving to find that they have no place to stay.
  • A recent article in Vice explored a situation where a “host” claimed to have a plumbing problem and instead did a bait and switch to steer travelers to dumpy units. Airbnb has responded to this situation by announcing it has introduced a new guarantee on the accuracy of listing information, and that over the next year it will verify the accuracy of all 7 million listings on its platform.
  • “Starting on 12/15/19, if a guest checks into a listing and it doesn’t meet our accuracy standards, we will rebook them into a listing that is just as nice — and if we can’t, they will get 100% of their money back,” according to a tweet from Airbnb’s CEO, Brian Chesky.
  • As with business email compromise fraud, scammers may be able to use phishing efforts to get the host’s information that they use to log into Airbnb, pretend to be the host and try to get the renter’s money without a real reservation. Airbnb says that it has now instituted multifactor authentication, which should help to protect against that activity.
  • Scammers may claim that their listing is “protected by” or somehow connected to Airbnb, perhaps using their logos or other marks, and tell the renter that they are protected when they are not. This is a common tactic of other scams that try to allay potential concerns by falsely claiming that a buyer is protected by PayPal or some other mechanism.
  • Renters may find websites that are actually cloned copies of Airbnb’s website. Airbnb makes great efforts to detect and take down these types of sites, but the company admits the scammers are very clever and the fake sites very well done.
  • Airbnb notes that scammers take advantage of events such as the Super Bowl where hotels may be booked and travelers are looking for an alternative place to stay. Those attending such events need to be extra careful, as scammers try to exploit these situations.

Law enforcement efforts

Given the large number of rental frauds, it is probably no surprise that there are many different types of scammers engaging in this fraud. Two large enforcement efforts recently have challenged nationwide frauds that employ fake listings, primarily on Craigslist.

The case against Credit Bureau Center

First, the FTC has taken action against a nationwide scam that used fake rental listings. Agents for Credit Bureau Center (CBC) advertised rentals on Craigslist, and those who responded were told by email that before they could see the unit in person, they needed to first get a “free” credit score at a site where they directed people. These sites touted the credit score as “free”, but in reality those who signed up had to enter their credit card and were unknowingly enrolled in a monthly credit monitoring service costing $29.94 per month. Many people did not recognize the charges, and some paid for months before they realized that they had been enrolled in a recurring billing trap.

The company had two different versions of its website. If someone went directly to the site after typing in the URL, they found a more complete disclosure of the terms and costs. But if they clicked through the link provided by the supposed property owner, those disclosures were, at best, in fine print. People were very unlikely to read and understand it. In a version of the site for mobile devices, there was some fine print if consumers scrolled down below where they entered their credit card information, but those disclosures were even worse than on the site linked in the fake landlord emails.

CBC hired an agent to place the ads, all of them on Craigslist. CBC had no authority to rent any of those places, and they presumably just copied photos and descriptions from other sites and posted them as their own. There is no way to tell how many bogus listings CBC posted. But we do know that 2.7 million people clicked through such ads and were taken to CBC’s website.

CBC never rented anything. It scammed victims out of $6.8 million. At the time that the FTC filed the case, they had located roughly 500 complaints about these tactics but later learned that there were actually 168,000 victims, indicating that most victims never complain or, if they do, those do not tend to reach national complaint databases.

The case against American Standard

The U.S. Attorney’s Office for the Southern District of Illinois successfully prosecuted a company that used bogus listings to deceive victims across the U.S. into buying a $199 subscription where they could supposedly locate rent-to-own homes in their area. This operation used several names but was most commonly known as American Standard, located in Santa Barbara, California.

According to the indictment, the company posted ads on Craigslist across the country advertising supposed “pre-foreclosure” houses where the renter could take over the existing mortgage and obtain the property for attractive prices. The ads did not provide a street address for these houses, just a town or neighborhood, and provided a telephone number. Callers were told that they could get the contact information for that house and other similar great deals in their area if they used their credit card to enroll in an online directory of these properties for $199.

However, American Standard did not have any information that the houses were for sale or rent at the prices shown in the ads. In many cases, the location was actually a vacant lot. They appear to have copied other postings from other sites or invented the listing. It is unclear how many bogus ads they posted over the years. They advertised in all 50 states. This enterprise scammed at least 100,000 people out of more than $27 million. Owner Michael Davenport (originally from Canada), sales manager Cynthia Rawlinson and three others were convicted of mail and wire fraud charges by the U.S. Attorney’s office in the Southern District of Illinois.

Targeting bad actors

Nigerian scam gangs also are heavily involved in rental frauds. Specifically, studies of Nigerian fraud gangs that engage in business email compromise and romance fraud show that these groups also perpetrate rental fraud.

These scammers need a way to obtain victim money because most renters would be highly unlikely to send funds directly to Nigeria. A recent report details a criminal investigation of a Nigerian living in Texas who was receiving money from rental fraud victims and sending it on to Nigeria. BBB’s study about the use of romance fraud victims as money mules describes how Nigerian fraudsters used victims to open bank accounts and launder money.

In addition, there have been reports about a number of criminal prosecutions in the US and Canada over the last year that involve rental fraud, often where consumers have met the fraudsters in person. Those include actions in Richmond, California; Manchester-by-the-Sea, Massachusetts; Aloha, Oregon; Berea, Kentucky; Long Island, New York; Skokie, Illinois; Enfield, Connecticut; Largo, Florida; Rensselaer, New York; Salinas, California; Brooklyn, New York; Raleigh, North Carolina; Imperial Beach, California; Arlington, Texas; Glendale, California; Peel, Ontario; Los Angeles; and Palm Beach, Florida.

Tips to help avoid rental scams

Home and apartment rentals red flags

It is likely a scam if:

  • The owner is out of town, and you cannot see the unit in person before sending money.
  • There is a “for sale” sign in the yard.
  • The alleged owner or property manager wants money through Western Union, MoneyGram, or a gift card. No legitimate business gets paid this way.
  • The rent advertised is well below market rates.
  • Those looking for a rental should first conduct an internet search. Copy the photos in the post and use Google Image Search or Tineye.com to check for multiple listings. Also search using an interesting phrase in the description. And search for the address of the unit.

If you see the unit in person, check ID and make sure you are dealing with the real property owner or manager.


If you are using a vacation rental platform:

  • Beware of “owners” that want you to get off the platform to communicate or send money.
  • Watch out for fake websites impersonating reputable vacation platforms. Real websites can be copied and created with another name.
  • Research the rental property owner and call them to be sure that they are real.
  • Do a quick internet search. Does the property exist at that address? Does the same photo appear at different locations?
  • Look at reviews carefully. These can be helpful, but note that crooks may fake reviews.

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