Six out of 10 Property Managers Experienced Fraud in Past Two Years
04 Avril 2024 - 2:00PM
As the rental market grew over the past couple years, fraud
naturally followed. Six out of ten property managers experienced
fraud in the past two years, according to research from
TransUnion’s tenant and employment screening business.
More concerning, 38% of property managers did not identify the
fraud until after the applicant moved in. These findings and more
are included in TransUnion’s Multifamily Report: Fraud Continues to
Be a Growing Threat.
“Once fraudsters become residents, the dangers and damages only
compound,” said Maitri Johnson, senior vice president of
TransUnion’s tenant and employment screening business.
“Delinquencies and evictions are expensive and take significant
time and effort to enact. In the meantime, the other residents
might be at risk with fraudsters nearby.”
The report found 43% of property managers saw increased
evictions due to fraud. More than a quarter (27%) had increased bad
debt and other financial loss.
Property managers appear almost evenly split with their
approaches to mitigating fraud risk. About one third (34%) use
outsourced services and technologies, while a quarter have in-house
employees who manually detect fraud. However, one third do not use
any formal tools but, instead, rely on visual, experience-based
risk assessments.
“Those who rely on their instinct, rather than a formal
methodology, may put themselves at risk,” said Johnson. “Not only
is that not effective for detecting potential fraud—especially as
fraudsters become increasingly sophisticated—it also risks denying
housing based on the property manager’s biases.”
The report found that even in-house manual risk assessment
processes left vulnerabilities to potential fraud. For example,
manually scanning driver’s licenses, checking credit scores and
verifying employment might not protect against fraudsters using
synthetic identities.
Comprehensive, identity-based solutions are powerful in helping
defend against rental fraud. Such technologies help detect red
flags that indicate fraudulent applicants before they move in.
These solutions also streamline the process for legitimate
applicants, getting them approved quickly.
“There is no one-size-fits-all approach to solving fraud.
Ultimately, multi-layered, identity-based fraud solutions improve
the customer experience by creating efficient processes for
applicants and protecting residents from would-be fraudulent
neighbors,” added Johnson.
TranUnion’s TruValidate™ ResidentID solution is designed
specifically for multifamily operators, using multilayered,
data-driven defenses to help stop applicant fraud.
Click here to read the Multifamily Report: Fraud Continues to Be
a Growing Threat.
Research MethodologyThis online survey of 98
property managers was conducted between October 23, 2023 - November
17, 2023, by TransUnion. Property Managers were surveyed via email
through an online research platform. Survey questions were
administered in English. The sample includes property managers who
oversee a variety of housing types, number of units, and locations.
These research results are unweighted and statistically significant
at a 95% confidence level within ±9.9 percentage points based on
calculated error margin. Please note some chart percentages may not
add up to 100% due to rounding or multiple answers being
accepted.
About TransUnion (NYSE: TRU) TransUnion is a
global information and insights company with over 13,000 associates
operating in more than 30 countries. We make trust possible by
ensuring each person is reliably represented in the marketplace. We
do this with a Tru™ picture of each person: an actionable view of
consumers, stewarded with care. Through our acquisitions and
technology investments we have developed innovative solutions that
extend beyond our strong foundation in core credit into areas such
as marketing, fraud, risk and advanced analytics. As a result,
consumers and businesses can transact with confidence and achieve
great things. We call this Information for Good® — and it leads to
economic opportunity, great experiences and personal empowerment
for millions of people around the
world. http://www.transunion.com/business
Contact |
Dave Blumberg |
|
TransUnion |
E-mail |
david.blumberg@transunion.com |
Telephone |
312-972-6646 |
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