NYS DCA alerts New Yorkers about rental scams

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ALBANY, N.Y. (NEWS10) — The New York State Division of Consumer Protection (DCA) warns New Yorkers about real estate and rental scams which steal prospective tenants’ money.

Rental scams are executed in a variety of ways, but the goal is the same, officials said. Criminals scam tenants looking to rent a home or apartment by impersonating licensed real estate agents.

Scams may include the attempt to “rent” a property that isn’t theirs to one or more potential tenants—sight unseen—making off with security deposits, first month’s rent, or prepaid rent, DCA said.

According to The DCA, criminals take legitimate rental postings and re-post or advertise them with their own contact information. Scams are often enticing, at lower rates than the original advertisement.

Transactions are generally conducted by phone, text message, or email DCA says. Asking potential tenants for a wire transfer, prepaid debit card, payment on a cash-based app, or another method of payment that is not traceable.

The DCA says other scams include bait-and-switch techniques. Criminals list a different property than the one available is advertised, with features they don’t really have in order to garner higher rent. Then charging potential tenant’s fees for background checks, stealing the money, and disappearing.

According to Federal Trade Commission rental fraud data, New Yorkers claimed losses of over $1.7 million during the last three years.

“I encourage New Yorkers who are looking for a rental property to follow basic tips to avoid losing their hard-earned money through deceptive practices,”  said Secretary of State Rossana Rosado.

To avoid falling victim to a rental scam, New Yorkers should follow basic tips:

  • Verify that the real estate professional you are dealing with is licensed in the State of New York by visiting the Department of State’s Public License Search.
  • Validate the real estate professional’s identity, conduct an independent online search to obtain the phone number associated with the professional’s license address. Call the number to verify.
  • Confirm that the property you are interested in is legitimately on the market.
  • Avoid paying any advance fees or deposits before having an opportunity to inspect the premises. Additional information on the types of fees an agent might be permitted to collect is available here.
  • Never give checks or wire money directly to the agent. Agents must be paid directly from their broker of record. Deposits and fees should never be in the name of the agent.
  • Demand a refund of your deposit or commission fee if the agent does not finalize rental or sale of the property. An agent earns a commission when he/she assists the landlord and tenant in reaching all agreements and terms of the apartment rental.
  • Request everything in writing, and get receipts. Never complete transactions in cash. leave a paper trail, use a credit card or a personal check.
  • Refrain from providing personal or financial information unless you are absolutely sure you are dealing with a reputable business or agent.

If a consumer has fallen victim to a rental scam, they are encouraged to file a complaint with the Division of Consumer Protection. Additional consumer resources on rental scams are available by visiting the Department of State website.

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