Warning! Organized Tenant Fraud in the GTA

There is currently an organized tenant fraud scheme going on in the GTA and we just saved our landlord client from it. With the high rent prices and the current economic situation, people are going through any means possible to secure a place to live.

So, we received an offer Friday night 11pm on one of our lease listings with an offer expiry of 10pm the next day. Now right away we responded to the agent that this would not be possible because it’s the weekend and we will need to do our due diligence and contact the employers and references on a working day. They also did not book a showing or see the property in person, this is not uncommon but still one of the several red flags that came up.

When it came to the rental application, credit report, employment letters, and pay stubs, they looked legit. The names given for the employers and references were real people who even show up on Linkedin but have no idea their info is being used in this scheme.

But here's where things started to get weird. Whenever we conduct employment verification, we always request the HR rep to send us an email confirming the employment, so we have it in writing from their company email. This has never been a problem. On the call the employers said they'd send it no problem, but the email never came. After calling again for a follow up on the email they just stopped answering altogether. My gut was telling me something was off.

After this we called the previous landlord and someone picked up saying sorry you have the wrong number, we asked if they were the owner of said property and they replied “I’m working I’ll call you back”. The second landlord reference didn’t answer. We got in touch with the tenant’s agent and said the landlord number is wrong and the other one isn’t answering. This is when things got really weird. Both landlords called us back later that day within 30 min of each other to confirm that they were in fact the owners of those properties and gave amazing references for the tenant who is trying to secure our clients property. One of them mentioned that “You can eat off her floors, she uses Dettol to clean everything.” We cross referenced the Ontario Land Registry (only Ontario licensed real estate agents have access to this) to make sure the names of the owners given on the rental app matched the property addresses, which they did. This means that there must be some licensed agents that are in on this scheme. Otherwise the tenant has no way to get the info of who is on title on a particular property...

Finally, we conducted a zoom meeting with the tenant and their agent. Now in the rental application they said they did not have a car and they don’t have a driver's license. They provided us with a purple Ontario ID card (This is an Ontario ID for those who do not have a driver’s license, making it easier for them to do things such as open a bank account and any other activities that require official identification.) But in the zoom meeting the tenant was in a car. We asked again if they drive or have a car. They brushed it off and tried to change the subject when we said they’d have to provide a drivers license. During the zoom meeting the agent told the tenant to tell us about how she cleans her house and the tenant then goes “Oh I’m very clean I use Dettol to clean the floors and stuff” it was so scripted at this point it was getting comical.

However, we still did not have any hard proof that the application was fraudulent. Until, we looked up the real estate agent who represented the landlord in the property that the tenant stated they lived in a few months ago. This agent ended up being a colleague from my brokerage, after speaking with her and explaining the situation she called her landlord client right away and confirmed that this landlord has never heard of these people and that that property had been leased out to a completely different family. We spoke to the second agent who represented the second landlord reference and he replied right away saying these tenants were a complete disaster, they destroyed his clients house and the phone number of the actual landlord did not match the one they provided us even though the names did.

So here’s our conclusion. The tenant IDs were probably real. This isn’t a case of identity theft. But everything else was fake. The job letters, pay stubs, the references, the employment contacts—everything.

Investing in real estate can be a risky move, especially when you end up with people who take advantage of the system. It just goes to show, you can never be too careful when screening tenants. Always, always verify everything and work with real estate professionals you can trust!