Detecting Tenancy Fraud by Heather Hilder on July 10, 2025 Detecting Tenancy Fraud A quick guide to detecting tenancy fraud For landlords looking for new tenants, tenancy fraud can be a significant and costly risk. Financial losses are estimated at £64,000 on average when you take into account eviction and legal fees. And of course, there’s also the additional hassle and unnecessary stress it can cause. Tenancy fraud can range from potential tenants exaggerating income, to tenants subletting properties or using them for criminal activities. According to proptech firm Homeppl, 94% of tenancy fraud cases involve fake documents. The most common of these are doctored bank statements at 81%. By over-exaggerating their income, tenants can pass the affordability checks that are designed to determine if they can pay their rent. Landlords won’t want fraudulent tenants in their property, but evictions will be more challenging once the Renters’ Rights Bill comes into force. Landlords will still have the right to give notice to tenants who commit antisocial behaviour or damage the property, as well as those who fall into rental arrears. However, the mandatory threshold for eviction for rental arrears is set to increase from two to three months’ arrears. Meanwhile the notice period for eviction for rental arrears will double from two weeks to four. Detecting fraud is therefore essential. Here are a few tips: Beware of doctored documents One of the most important steps in preventing tenancy fraud is to analyse documents to ensure they are genuine. It’s not always easy spotting a document which has been tampered with. Prospective tenants may modify genuine documents or create false ones. Documents ranging from ID to bank statements, utility bills and financial and employment information must be scrutinised. Tenant reference services can help do this and will also often use more advanced technology, such as AI, to check the validity of such documents. Refuse too good to be true offers Fraudsters looking to sublet a property or use it for illegal purposes may propose offers that seem too good to be true, such as additional rent in advance or a higher offer. Trust your instinct because such offers are likely to be too good to be true. This practise will also be forbidden once the Renters’ Rights Bill comes into force. At this point lettings agents and landlords won’t be able to accept anything over the published rent and only one month’s rent in advance will be expected, so if a prospective tenant tries to offer more, alarm bells should ring. Meet them in the flesh Sounds simple but it’s actually a very powerful check. Meeting in the flesh can help weed out some of the more unscrupulous tenants-to-be. Someone who may have been tempted to exaggerate their income slightly may find that harder to do when they have to look you in the eye. AML and sanctions checks Anti-Money Laundering (AML) regulations were expanded in May 2025 to require checks for all rental properties. As a result identity verification and sanctions checks are now required on both landlords and prospective tenants before a tenancy can begin. Comprehensive records of the checks must also be kept. Callaways Estate Agents is here to support landlords along the South Coast from Arundel to Brighton & Hove. Contact us today to learn how we can help you adapt to new regulations and safeguard your investment. Reach out now for expert advice!
