Watch out for COVID-related rental scams

While millions of scam listings for apartments, houses and vacation properties appear online, the Better Business Bureau (BBB) is urging the public to watch out for a COVID-19 twist to common rental frauds after receiving almost 50 reports within the last month from victims in the United States.

How the scam works

Fraudsters search for information about legitimate rental or sale properties on specialty websites. Then they copy the ads and repost them on a different platform, usually on Craigslist, Kijiji and Facebook Marketplace, and pretend to be the owners. In order to attract interest, the rent amount for the property is usually below market price.

When consumers contact the scammer, they are invited to see the apartment/house but are informed that due to COVID-19 restrictions, they are unable to meet in person for a viewing. However, the scammer encourages the potential renter to visit the property and do an inspection from outside. If they wish to proceed with the rental, the scammer tells them to make a payment online for the first month’s rent or a security deposit. The scammer also promises to make arrangements to sign the lease agreement once COVID-19 restrictions are relaxed.

Victims are urged to make payment as soon as possible to secure the rental. Several BBB Scam Tracker reports shared where victims were asked to make an initial deposit of USD 2,500 or higher by wiring money through Moneygram or Western Union. Alternatively, payment was also accepted using a money order, cashier’s cheque, or Cash App.

“An advertised rental may seem like the perfect fit for you but it may be a scam”, says Karla Laird, Manager for Community and Public Relations at BBB serving Mainland BC. “While we have not received any COVID-19 rental scam reports for our province, we anticipate this could be a new scam trend and are urging consumers to be on the lookout.”

Last year, more than 5 million people across North America lost over $500 to rental scams, and with COVID-19 adding further opportunities for scammers, this could lead to a spiral in reports across Canada.