The Arms Race Against Fraud

Overview

Criminals are an ingenious bunch, so it’s too bad they use their creativity and determination for bad things. They’re constantly coming up with “innovations” in scams, so we need to be just as creative to invent new tools to combat them.

In the apartment industry, people try to fake their income and their employment to qualify for a rental. A couple of decades ago, you’d use a photocopy machine to try to fake a pay stub. Now, you can download the logo of an actual employer and use desktop publishing software to fake your income. You can buy fake Social Security numbers that belong to people whose identities have been compromised.

Scammers are very industrious and tend to prey on members of society who are the most marginalized. They’ll lease a two-bedroom apartment and then rent pieces of it to 10 people who are undocumented and can’t rent an apartment in the traditional manner. Or they’ll turn a $2,000 a month rental apartment into a $250 per night illegal Airbnb with no intention of paying any rent to the landlord. When the eviction notice comes in these situations, it turns out the alleged renter used false information and is nowhere to be found. The people who are hurt the most are the ones who were paying someone for the ability to sleep on the floor on a mattress. And, of course, the landlords get hurt, too. It’s horrible.

As an industry, people are constantly developing new credit reporting tools to verify identification and income to combat scammers. There are new tools that can scan a paycheck and use AI to match it against a known paycheck from the same employer to find the smallest variance and determine whether it’s fabricated or not.

Leaning into technology helps a lot. At Bonaventure, we use TransUnion Income and Employment Verification, and Checkpoint ID’s Paystub and ID verification software.

But we also participate in what I like to think of as almost a Neighborhood Watch program against scams. We stay aware of what’s going on in the apartment industry and in each of our local submarkets. If there’s an increase in fraudulent applications or some other kind of fraud, we step up our vigilance. It’s no different than if there was an increase in the number of car thefts in a neighborhood. You use deterrence. You park your car in your garage, you lock your car, you buy a club to lock the wheel.

Combatting fraud takes more than a one-time software purchase. We experiment with new tools to stay ahead of the scammers and their new approaches. We’re attentive to news about potential scams in our industry and in the communities we serve to protect our residents, our community and ourselves.