Fraud in multifamily leasing has reached unprecedented levels of sophistication in 2025, with both individual applicants and organized groups using advanced tactics to secure apartments under false pretenses. Here are the most prevalent types of fraud property managers are encountering today:
The most widespread fraud involves applicants submitting doctored pay stubs, bank statements, or employment letters to inflate their income or hide unstable finances. With easy access to PDF editing tools and AI-driven generators, these documents are now nearly indistinguishable from the real thing—making visual inspection alone ineffective. Some applicants even use “inception fraud,” presenting real pay stubs from actual companies, despite never having worked there.
Fraudsters are increasingly using stolen or entirely fabricated identities to pass background checks and credit screenings. This can involve fake driver’s licenses, Social Security numbers, or even “synthetic identities” created from a mix of real and fake information. These tactics allow applicants to hide poor credit histories, prior evictions, or criminal backgrounds, putting both property managers and residents at risk.
A growing trend is the rise of “fraud-as-a-service,” where scammers sell ready-made fake documents, credit reports, or rental references to would-be tenants. These services, often marketed online, make it easier than ever for applicants to submit convincing fraudulent applications and bypass traditional screening methods.
Not all fraud comes from outside applicants. Some leasing staff, especially those compensated by commission, may be tempted to overlook questionable documents or even participate in schemes for a share of the proceeds. Economic downturns and rising pressure to fill vacancies can increase the temptation for internal fraud, compounding risk for property owners.
Applicants may supply fake rental histories or references, sometimes using fictitious landlords or collaborating with others to provide glowing, but false, endorsements. This tactic is designed to obscure prior evictions, payment issues, or problematic behavior in previous rentals.
The consequences of leasing to fraudulent tenants are severe: missed rent payments, costly evictions, increased bad debt, and threats to community safety. As scams become more sophisticated, multifamily operators must move beyond manual checks and adopt multilayered, technology-driven screening solutions that verify income, identity, and rental history at the source.
Staying vigilant and leveraging advanced verification tools are now essential steps to protect your properties and your residents in 2025.
