Scammers don’t take a holiday break, even if you and your residents do.
For property managers, the holidays offer well-deserved downtime. But unfortunately, fraudsters don’t go on vacation.
According to the FBI, the holidays are one of the busiest times of year for scammers, whose fraudulent applications can snare apartment companies, lenders, and residents. Costs run higher than $500 million. AARP’s Holiday Scams Report found that 75% of Americans were targeted or victimized by application process fraud, credit card scams, data breaches, and personal data theft.
For multifamily operators, holiday scams compound the issue of rental application fraud, a year-round scourge in the industry. While a slowdown in leasing during the holidays offers temporary respite application scams, these bad actors are waiting just outside – and sometimes within – property managers’ doors.
Social media shopping scams
Online shopping fraud attacks are among the most common types of holiday fraud. They employ social media ads to steer shoppers to fake online stores, fake bank account openings or share personal information under the guise of identity verification, which is then stolen. The fraud risk here is high— and all social media shopping links should be thoroughly vetted to make sure they’ve been through an authentication process to ensure they’re legit.
Phishing link scams, where cybercriminals send malicious URLs to social media users, steal personal information or infect that person’s device with malware that can pose a continuing threat throughout the year. In addition, nearly 50% of social media users have been victims of online shopping scams.
While many think older adults fall victim to these schemes more often than younger, internet-savvy users, that’s not true, according to AARP. in the 18 to 34-year-old demographic – the largest cohort of renters – more than 81% of respondents had fallen victim to fraud, compared to 69% of adults aged 65-plus.
That means your residents could be especially prone to these scams, which can wreak havoc on an individual’s financial life when they lead to identity theft. The repercussions for property managers, like fraud losses, come when residents experience economic turmoil in the new year and struggle to pay rent. In addition, credit Card Application Fraud is a seemingly rampant issue, where false credit reports are drafted and attached to online applications to make applicants seem more qualified than they are.
Help residents avoid becoming victims of these crimes with alerts on your resident portal and signage and preventative language in other resident communications. Visit the FBI’s online resources to get started.
Another big target for holiday scammers is retailer gift cards, which nearly two-thirds of shoppers plan to buy or give this year. Fraudsters often tamper with gift cards on physical retail racks, a type of scam Consumer Reports says has been common for years, so that as soon as a card is activated, its funds are automatically drained. Indeed, according to AARP, 21% of Americans have either given or received gift cards with a $0 balance, according to AARP.
For property operators, who often give residents gift cards during the holidays, being a victim of this type of fraud is embarrassing and can anger residents.
Who wouldn’t be miffed by getting a $10 Starbucks gift card only to find out it’s empty?
The solution, fraud prevention experts say, is to ensure that you only buy gift cards from retailers’ official online sites and keep them secure before giving them to tenants.
One of the hallmarks of modern apartment life during the holidays is the overflowing package room.
Invariably, packages get left in a common area or sometimes in front of an individual resident’s door. These packages are susceptible to theft by scammers who can quickly enter the lobby during business hours or even other residents -- more than a quarter of all Americans report stolen packages.
At multifamily properties, a go-to solution has been package lockers. But even these get overwhelmed during the holidays.
One way around this conundrum is to enable in-unit deliveries by employing smart locks and a resident portal that allows renters to opt-in to having staff enter their homes.
“In-unit deliveries could be the answer for many properties and residents,” Robert Gaulden, director of multifamily channel strategy at Allegion, tells Multifamily Executive.|
The rise of short-term rentals has also led to an increase in spoofed rental listings. This happens when content is copied from a legitimate apartment firm’s website and reposted to take reservations—and the accompanying fees—elsewhere.
The Better Business Bureau says these rental ploys are on the rise, with fraudsters posting on recognizable third-party sites like VRBO or Airbnb.
One way to combat this trend is to set up a Google alert with your property’s name to flag unauthorized listings. Doing so can also help a community’s reputation management when unfavorable reviews generate negative posts online, giving operators a chance to respond and intervene.
While property managers should take a break during the holidays, they must also remember scammers don’t go on vacation. Taking simple steps to avoid these scams can help property managers -- and their residents – experience more holiday cheer— and less year-end fraud.
Snappt's Approach to Holiday Cheer
If you would like a hand in these efforts, our team at Snappt is here for you, even over the holidays. Snappt’s data-driven tenant fraud detection software saves you time, money, and guesswork—all while protecting your portfolio. If you’d like to know your risk and to see what tenant fraud is costing you, try our free ROI calculator.
If you are ready to fight fraud and losses for your property, contact SNAPPT for a demo today.