Fraud triggers increased 30% between March and August, a new report shows
Signs that fraud might be on the rise are popping up in the rental housing market, according to a new analysis.
Fraud triggers – defined as applicant statuses with failed authentication and/or identified as high risk – reached a high of 15.2% in August, according to a report from credit reporting agency TransUnion.
That marks a nearly 30% increase from March through August, as many families were financially struggling through the effects of the coronavirus pandemic.
“Fraud continues to be an increasingly concerning issue in the multifamily industry for the last several years and the COVID-19 pandemic driven shift to virtual leasing has pushed this concern to the forefront for property managers,” Maitri Johnson, vice president of TransUnion’s tenant and employment business, said in a statement.
A subsequent study conducted among multifamily housing executives by TransUnion found that the frequency of fraud incidents had increased by nearly 50% since the pandemic began – and many were not able to identify the fraudsters until after the applicant move-in.
The industry cited numerous negative consequences that a rise in fraud has wrought, including spending more time reviewing applications, increasing bad debt, increasing evictions and financial losses.