Fraudulent Renters in Neighborhood, Condo Owners Experiences
Recently, our neighbors have become the victims of an especially insidious form of renter fraud. It has happened in the South Park condo building where I am a Homeowner Association Board Member.
Here’s how it works:
You want to rent your property on a long-term basis, so you place an ad or entrust your real estate agent to list the property for rent – a seemingly innocuous effort. You or your agent receive a phone call from a prospect who supplies you with information about herself. You or your agent perform a quick check and find a potential tenant with a good credit history and several “references” that seem to confirm her upright citizenship. After a cursory inspection, you agree to rent to the prospect and send your lease. The lease comes back immediately with signatures, the new tenant provides you with your required deposit and first month’s rent which upon reflection, came by money order. Your new tenant moves in.
You don’t know it yet, but you have become a victim of fraud. When your second month’s rent doesn’t arrive as promised, you pay a little more attention to what has transpired. You realize that you never met the tenant in person before allowing the move in. After all, the “tenant” told you she didn’t need to see the place as she had seen the photos in the rental ad. Then you discover upon searching the out-of-state address the tenant provided that it belongs to someone who recently had their identity stolen.
Furthermore, instead of a female tenant, you now have several male tenants. Your agent drops by to speak with the “guys” and is unable to get past the front door to your unit. The locks have been changed. Things are further complicated when your building manager notifies you of disturbances from your unit and that nefarious activities are suspected. The police have been called but can’t find anyone home. You call your attorney and find out that evicting your “tenant” is another set of problems. The process is time consuming (months) and expensive. How do you proceed when you only have a fake identity? How can you collect back rent owed from phantoms? As you struggle to solve the problem, another month goes by without your needed rent. Meanwhile your unidentified tenants are luxuriating in your home for free and the place is starting to smell funny. Unfortunately, even when and if you finally identify your guests, it will still take months to get them evicted due to California’s Landlord/Tenant rules slanted toward protecting the tenant.
This scenario has been repeated several times in my condominium building. One instance resulted in a police raid at 5:30 am where the unit’s front door was smashed in and the occupant “tenants” were arrested with several unregistered firearms, stacks of cash, and a closet full of illicit drugs.
Another “tenant” was finally evicted after the owner spent thousands of dollars in legal fees over a 12-month process. When the tenant finally left, she took all the owner’s furniture with her, leaving them a damaged and empty shell. They had originally rented their home to the woman for 12 days through AIRB&B and never bothered to check her out when she told them she loved living in their beautiful condo and convinced them to send her a year’s lease - for which she neglected to pay them a single dime for the year she squatted in their property. She left town immediately upon successful eviction and cannot be located.
We have recently heard that a new residential tower in downtown LA was forced to evict 40% of their tenants due to non-payment of rent and identification fraud. Be aware that these evictees are now out on the street looking for someone else to provide them with a free place to live!
Ariel Harris, Assistant Manager of our building, has sent the following warning to our residents:
Urgent: Reinforcement of Tenant Vetting Procedures
Dear Ten50 Owners and Listing Agents,
I am reaching out to reiterate the critical importance of comprehensive tenant vetting and background checks, particularly in light of recent incidents involving fraudulent and falsified leases within our community.
As the housing market continues to evolve, we have observed a concerning uptick in deceptive practices, emphasizing the necessity for stringent screening processes. To ensure the security and integrity of our community, we strongly emphasize the following key points:
1. Comprehensive Tenant Vetting: We urge all Owners and their agents to conduct exhaustive background checks on all prospective tenants. This includes a thorough examination of identity, rental history, employment verification, and criminal background checks. Additionally, we encourage you to check in with Management BEFORE moving forward with new tenants.
2. Verification of Documentation: Please ensure that all documentation provided by prospective tenants is genuine and verifiable. This includes but is not limited to identification, proof of income, and references.
3. Caution Against Short-Term Rental Platforms: In light of recent challenges, we strongly advise against using platforms such as Airbnb, VRBO, Booking.com, or any similar services for leasing purposes. These platforms pose a higher risk of lease violations and fraudulent activity.
We understand the convenience these platforms may offer, but the potential risks far outweigh the benefits. It is crucial to prioritize the security of our community.
As custodians of our building, your diligence in adhering to these guidelines will play a pivotal role in maintaining a safe and trustworthy living environment for all residents and staff.
Please be diligent and forewarned about the wild, wild west that has become the reality of residential rentals in Los Angeles and other parts of the country! Rental fraud can take the form of the examples above or any variety of modifications. The criminal mind is resourceful! Know who you are renting to!
By John Nilsson