PSA: A new online rental scam may be making the rounds—and not just on Craigslist

By Lucy Cohen Blatter | September 22, 2015 - 12:59PM

Craigslist's real estate section gets a bad rap, albeit somewhat deservedly, for being full of rental scams and bait-and-switches, but unfortunately bad listings are not confined to one website. Last week, an NYC broker—we'll call her G.—reached out to us to report suspicious activity she and her colleagues have allegedly seen on StreetEasy.

Over the last few months, they've noticed agents from outside the city posting rentals and sales for apartments they're not actually representing. They've also seen rentals listed with brokers who they know don't represent the buildings (in cases where certain brokers have exclusives on buildings). In one case, a broker's name was attached to over a dozen rental listings she had nothing to do with it.  

One occurrence was strange... and hard to understand. G. was working with a buyer on an off-market townhouse sale, and the owner suddenly saw the house pop up on StreetEasy  without her permission (see screenshot below). It was listed by a broker in Rochester, New York.

When G reached out to the broker in Rochester,he  said he hadn't done it.  StreetEasy looked into it, and said the listing had been paid for by a broker of that name. It was  delisted. (We reached out to that broker for comment, but he didn't respond).

G. says she can't understand what the broker was planning to do in the case of a sale, but the listing had information on an Open House; perhaps he or she was planning on meeting an interested buyer there and then showing them someplace else (sort of a bait and switch for sales), in the meantime making the prospective buyer think he/she was a licensed broker.

Of course, it's harder to scam a buyer—since the sales process is so involved and takes so long—but the rental market is rife with shady dealings, brokers tell us. Usually what happens is this: A scam artist will list an apartment he or she is not actually renting out and ask the prospective renter for money upfront -- either a "deposit" or rent money -- to lock it in. 

And, according to G., the StreetEasy rental scams seem to follow the same pattern.

"An agent at my firm that does a lot of rentals starting noticing a pattern of 'agents' that were not based in New York placing listings that didn’t seem legit. In fact, another agent at our firm knew listings at a specific building did not exist because he knew the property and had listings there," she says. (StreetEasy only accepts "exclusive" rentals listings.)

Debra Derella-Cheren, a broker with Douglas Elliman, recently discovered dozens of very high-end rentals (we're talking $50,000 range) listed on StreetEasy under her name. She knew nothing about them and wasn't renting them. She immediately reached out to StreetEasy, and they took them down, she says.

Curiously, most of these bogus listings seemed to go up on Friday and be down by Sunday night, says G. It's possible the scammer was trying to lure people to open houses.

We reached out to StreetEasy, and their spokesperson confirmed that they do have customer service representatives on-call and checking in on weekends. 

And it's something they take seriously: "We have an entire team of people and proprietary technologies dedicated to policing and preventing fraudulent listings." StreetEasy asks users to report suspicious listings. When they hear about them, they contact agents to confirm the listing or immediately removing them from the site. Since StreetEasy only allows exclusive rental listings on its site and not open listings (that more than one broker can represent),  they'll often ask an agent to provide a copy of the exclusive agreement.

To be safe, make sure you meet someone and see an apartment before you give them any money, and check that the broker is actually licensed by the state of New York. (G. says some of these phony listings brokers were not.) It's easy to do it on this state government website

And if you see something, say something. These things are just part of doing business, StreetEasy says. "It’s an unfortunate reality of the internet that fraud exists across rental sites ... We take flags from our users very seriously and respond to them immediately."

Stay tuned.


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