With the frequency of data breaches, media reports of stolen identities, and advice on protecting your personal information, it’s easy to forget that identity theft victims are just one of many who lose in identity-related crimes. Anyone who inadvertently accepts falsified identity information becomes a victim as well—and the costs can be staggering.
Because CoreLogic® works with clients from several industries that identity fraudsters target, we have been actively pursuing solutions to help clients avoid becoming victims. Recently, CoreLogic Rental Property Solutions looked into how applicant fraud affects the rental property market. No large-scale studies exist for the rental property industry, so we conducted interviews and surveys of 30 clients who own or manage multifamily rental properties.
Among the findings, we discovered that a shocking 75 percent of clients surveyed said they had been victimized by identity fraud—and 100 percent of those with more than 30,000 units confirmed incidences of identity-related fraud. Further research showed that while time to eviction varied by state, the average cost per eviction ranged from $5,000 to $10,000.
CoreLogic Rental Property Solutions followed the lead of other CoreLogic divisions and began working with ID Analytics® to learn more about the mechanics of how identity fraud affects the rental market. ID Analytics uses data from more than 2 billion online and off-line consumer transactions and applies a patented technology-driven approach to detect stolen and fraudulent identities.
We discovered that a shocking 75 percent of clients surveyed said they had been victimized by identity fraud—and 100 percent of those with more than 30,000 units confirmed incidences of identity-related fraud.
As we explored the impact of applicant fraud on the property rental market, several disturbing facts emerged. The first was that online leasing streamlines the leasing process for good and bad applicants alike, making it much easier to commit identity fraud. Second was the unsettling fact that the desire to live rent-free was just one of many reasons people commit identity fraud when renting. In fact, many people who falsify their identities pay rent on time—and some live undetected for years. Their motivations for presenting false identities vary and can include disguising their true identity to avoid arrest for outstanding warrants1. Some lease applicants use fake IDs while misrepresenting why they’re renting, e.g., intending to sublet for short-term vacation rentals or to use the property for illicit activities.
We also gained a deeper understanding of the types of identity fraud property owners and managers encounter. Identity theft fraud, where an applicant assumes a stolen identity, is one type of applicant fraud. Because it involves an identity theft victim who may subscribe to a service that protects them, identity theft fraud is among the easier schemes to spot. More difficult to detect, synthetic fraud involves a made-up identity where some or all of an applicant’s personal identifying information is fabricated. The variety of fraud schemes is coupled with an array of operators, which include more than 10,000 identity fraud rings ID Analytics has uncovered.
We will be consolidating our findings into an insight report, How Identity Fraudsters Operate and What You Can Do to Stop Them, which will provide a fascinating, in-depth look at the mechanics and effects of applicant fraud on the rental property market.