The looming ‘fraud’ cloud hanging over landlords

To Let signsThere has been a lot written about the risks that tenants face around ID fraud but what about the dangers to landlords?

Recent figures from fraud prevention experts, Cifas show that there were 6,274 instances of ‘previous occupier fraud’ – when a fraudster moves into an address and take on the previous tenant’s identity to apply for credit or loans – across the UK from January to June 2015, with fraudsters attempting to obtain products or services worth an estimated £8.6 million. This ties in with recent Office of National Statistics data that revealed application fraud had risen by 14% to 60,451 in the twelve months leading up to June 2015.

Now, you may be thinking that it is not your problem if your tenant is the victim of ID fraud, but you would be wrong. Any fraud that occurs in your property could have a lasting impact not only on your wallet but also your property and potentially your ability to secure credit in the future.

The potential consequences of identity fraud occurring in your property are:

  1. You may lose money. The chances are that if someone has come into your property with the intention of committing fraud, they won’t pay rent, service bills etc.
  2. You could end up with a County Court Judgement against you. If your identity is stolen and debt is accrued in your name, you could end up with a CCJ against you which can affect your credit rating.
  3. If ID fraud occurs in your property, it could be placed on a ‘blacklist’ which means that it can be difficult (and take longer) for you and future tenants to secure services, utilities and financial products at the address.
  4. You will have to go through a lengthy eviction process to get your property back. This will take both time and money.
  5. Unrelated to fraud but something that could cost you – property damage. You will need to pay to sort out any damage at the property.
  6. Lots of stress, time and effort. It can take months, or even years, to resolve an ID fraud.

It is essential to do everything you can to protect your property. Taking simple steps, such as installing separate letter boxes for each residence, can help reduce the danger but what else can you do to minimise your chances of becoming a fraud victim through your rental property?

Here are a few simple steps to protect your property:

  1. Follow the tenant referencing process: use a comprehensive tenant application form, carry out credit checks on all new tenants, look out for previous CCJs or financial irregularities, and ask for/ contact previous landlords and employer references.
  2. If you have a house of multiple occupancy, try to ensure that mail for each residency is separated out by installing individual post boxes at the property.
  3. Remove the risk of financial details falling into the wrong hands. Recommend that your outgoing tenants take out a Redirection for 12 months when they leave the property. This removes the issue of sensitive financial details remaining in the property, working out where to send on the mail of previous tenants, and taking the responsibility for disposing of it safely.

Jim Conning is the Managing Director of Data Services at Royal Mail.

3 thoughts on “The looming ‘fraud’ cloud hanging over landlords

  1. Anyone that has been a landlord for any time, will tell you this fraud is quite widespread. Thank you NLA for highlighting it. Please pressure Government to act on this. The Government appears to be very keen on pushing their duties on to Landlords; let us see them respond positively.

    1. Unfortunately, the only thing the government is likely to do about this is add more regulations and responsibilities on landlords. Do we really want new rules making us responsible for it ?

  2. Be Warned ! We Let out Family House to Tenants- their Staff attempted identity theft – with application to credit card loans etc – they had accuse to the the property just at the time tenant moved out – to pick up the mail – We were luck they slipped up – but only just lucky-

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