FBI urges Public to beware of Rental Scams

As rents, home prices, and inflation surge in today’s highly competitive real estate market, the FBI is warning the public about the risk of rental scams and the need to be cautious when posting and responding to advertisements for rental properties and real estate online.

Rental scams occur when the victim has rental property advertised and is contacted by an interested party. Once the rental price is agreed upon, the scammer forwards a check for the deposit on the rental property to the victim. The check is for housing expenses. It is either written in excess of the amount required, with the scammer asking for the remainder to be remitted back, or the check is written for the correct amount but the scammer backs out of the rental agreement and asks for a refund. Since the banks do not usually place a hold on the funds, the victim has immediate access to them and believes the check has cleared. In the end, the check is found to be counterfeit and the victim is held responsible by the bank for all losses.

Another type of scam involves real estate advertised online. The scammer duplicates postings from legitimate real estate websites and reposts these ads after altering them. Often, the scammers use the broker’s real name to create a fake email, which gives the fraud more legitimacy. When the victim sends an email through the classified advertisement website inquiring about the home, they receive a response from someone claiming to be the owner. The “owner” claims they’re unable to show the property without payment because they are either out of town or out of the country. If the victim is interested in renting the home, they are asked either to wire money or, in some cases, make a digital payment. Shortly thereafter, the property is no longer available.

Nationwide, in 2024, 9,359 people reported $173,586,820 in losses to the FBI’s Internet Crime Complaint Center (IC3) due to these types of scams. The actual losses are most likely much higher because many people are hesitant to report they were scammed. 

How to avoid becoming a victim:

• Do not wire funds to people you do not know.
• Do not put money toward a house or apartment you have not seen.
• Confirm the identity of the landlord by researching public records to find out who owns the property you are seeking to rent or purchase.
• Do not fill out applications online until you have met directly with the property manager.
• Know local rental prices.
• Look for online reviews, references, and testimonials from past inhabitants.
• Beware if a potential tenant wants to rent property sight unseen.
• Beware if a potential renter says they are out of town and will send you a cashier’s check.
• Beware if a potential landlord says he is out of the country and wants the rent sent to a foreign account.
• Do not accept overpayment for properties. If you receive a check for more than the specified amount, return it. Do not deposit it.

If you find yourself the target or victim of a rental scam, stop all contact immediately. If you have already sent money, it is extremely important to report any transfer of funds to your financial institution and file a complaint with the FBI’s Internet Crime Complaint Center at ic3.gov.