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UK Lettings fraud: banks could be complicit

Homeppl, one of the leading tenant referencing providers, has confirmed this week that 91% of the fraud they flag in UK rental applications stems from applicants attempting to conceal their true affordability by modifying original financial documents or creating completely fake ones.

Research conducted by the service provider shows that, on average, it now costs £44,000 to evict a rogue, fraudulent tenant in the UK. This includes legal fees, eviction costs, and damages. When combined with the value of a fraudulent contract, especially in London, this can be financially detrimental to both the landlord and the agency.

Alexander Siedes, CEO and Founder at Homeppl, commented: “We’re in the middle of an economic crisis where demand for rent is high, the cost of renting is high, the cost of food, gas and heating is high, and because of that, we have seen people falsify their rental applications to secure property in a difficult market.”

London’s average rent is still above £2000 per calendar month. If a tenant defaults halfway through a 2-year lease, the landlord is out of pocket by £24,000 + any eviction costs he/she might incur.

Mr Siedes added, “People think if they edit a bank statement to reflect a larger balance, their application will get accepted immediately. Whilst that may be enough to fool some referencing companies, our advanced document analysis technology will flag any edit in seconds”.

Homeppl has recently launched its new product, “Fraud Finder”, an API that can be licensed to letting & real estate agencies and build-to-rent developers to detect document fraud in their rental applications. The tool authenticates genuine financial documents such as bank statements, pension statements, investment portfolios and utility bills. It conducts a series of fraud tests to signal any modifications, sending decisions back in seconds.

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