23rd
Sep 2016
The Private Rented Sector is rife with the number of online rental scams and was up by 44% from 2014 to 2015.
There are many new online platforms for advertising properties which are extremely cheap or no cost at all where rental fraud is increasing daily. According to YouGov in 2013 1 million people were victims of online rental fraud, however this is probably not the true figure as many people will not admit to being duped. Shockingly the LGA (Local Government Association) claims that just 5% of occurrences are reported.
Criminals find it easy pickings to post a fake advert on various classified sites, as there are very little vetting and security measures in place.
Bogus landlords are estimated to be making at least £775 million per year from rental scams and each victim on average is losing £2,400.
Some property classified sites have introduced an ownership verification process that uses the Land Registry databases, however there are far more sites out there that do not properly implement such procedures. The reason could be that they refuse to own up to the fact that their site does not have proper structures in place to protect potential victims.
One of the sites that does protect it users, co-founder Nick Marr said: ‘The difficulty with the online classified business is finding the perfect balance between empowering genuine customers, without making them jump through too many hoops, while ensuring you have sufficient security checks in place to guarantee that both users, and their ads, are genuine. Scammers have become highly sophisticated and it isn’t always easy to spot fake or misleading ads – even manually reviewing adverts can still allow some bogus ads to slip through the net. To be honest, I think it’s a bit of a dirty little secret in the industry, because we all know that this is going on, but no one wants to step up and talk about it openly because they don’t want to admit that fraud is happening on their website. And for many players in the classified ad space, there is quite frankly very little they can do to prevent it."
A spokesperson for the Land Registry explained that they are actively working with sites that operate good practise procedures and it yields extremely positive results for all: "For more than 150 years Land Registry has protected and guaranteed people’s land and property rights by keeping and maintaining the Land Register for England and Wales. Today that register covers around 83 per cent of the land mass of England and Wales, contains more than 24 million titles, and is one of the largest transactional property databases in Europe."
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