Last summer, the OPP alerted Ontarians to a cottage rental scam conning people into e-transferring money in exchange for non-existent rentals. Experts at the Canadian Anti-Fraud Centre (CAFC) warn that these types of scams could once again pose a threat this year as cottage rental demand skyrockets due to the pandemic.
According to the CAFC, online rental scams increased by 15 per cent between 2019 and 2020 with Canadians losing approximately $586,000. “The pandemic has played into the rental scam market in terms of preventing renters from actually visiting a rental site or talking to somebody that’s been there,” says Jeff Thomson, an RCMP intelligence analyst with the CAFC.
To ensure the cottage rental you have your eye on is legitimate, Thomson advises taking these steps:
Know the true market value of the rental
Whether you’re looking for a short-term rental or long-term rental, Thomson says it’s important to do some market research on the area to get a sense of the general rental rate. “Be wary of anything that’s below average pricing,” he says. “Trust your instincts. If it seems too good to be true, it probably is.”
Beware of urgency
With the cottage rental scam that hoodwinked Ontarians last summer, a common theme was urgency. The owner of the property would tell the potential renter that other people were interested and if they wanted to secure the booking, they needed to pay a down payment immediately. After the payment was transferred, the owner of the property would disappear.
Thomson says this is a technique used by fraudsters to pressure people into paying. Don’t rush into a booking without doing your due diligence, he says.
Even established websites can be unreliable
While online travel agencies (OTA), such as Airbnb, are quick to identify and combat fraud, Thomson says that scams can still occur on reputable rental websites.
Regardless of the OTA you’re renting the cottage through, Thomson says you should always read the site’s terms of service to see if they offer fraud protection. That way, if you do fall victim to a scam, you should get your money back.
Perform an image search
That pristine lakefront rental with the rock bottom price is probably too good to be true. Before committing to any cottage rental, make sure it actually exists. Thomson says that in some instances of rental scams, the fraudsters will take photos of properties listed elsewhere, such as real estate sites, and use those to create a phony listing.
“Doing an image search might help you,” he says, “or just running the address to see if the property is listed anywhere else, and if it has different contact information.”
Get in contact
Reach out to the owner of the property before renting the cottage. Whether it’s a property management company or an individual owner, jump on a call to make sure that the contact information is correct and that the owner actually exists.
Thomson says, if possible, you should also ask the owner if you can visit the property before booking your rental. This way you can confirm that the rental isn’t a scam. If you can’t visit the property due to distance or to the pandemic, Thomson advises contacting a local real estate agent to see if they have any information about the property, or asking friends or family in the area to drive by and do some research for you.
Be wary of payment methods
Once the payment’s gone, it’s likely you’re not getting it back. “In a lot of cases,” Thomson says, “fraudsters will ask for transactions to occur through payment mechanisms that may not offer any fraud protection.” This includes sending money via Bitcoin, a money service business, such as Western Union, or even e-transfers.
Before sending the money, Thomson says you should ask yourself whether you will be able to dispute the charges, or if you will be able to put a stop payment on it. “If someone is asking you to transfer money through a payment mechanism that doesn’t have these kinds of fraud protection, you’re taking a leap of faith,” he says.
What to do if you notice a scam
“Any case of fraud should be reported,” Thomson says. “Whether you’ve been a victim…or not, the crime should be reported to your local police.”
Thomson does recognize that due to capacity issues, the police won’t be able to respond to every incident of fraud. But that’s why CAFC was started. “The idea behind us is to central source all of the information on fraud and be able to deconflict across jurisdictions.” If you do encounter a scam, you can report it to the CAFC here.
Thomson adds that any minor piece of information could be essential in helping to unravel a scam. “We want all the information you have. It’s useful for us for disruption and for linking other cases together.”