As if hunting for a roommate weren’t stressful enough, there’s a type of scam that targets those searching online for the perfect flatmate. Keep reading to learn how this scam works, common warning signs, and some tips on preventing it from happening to you or someone you know.
Although anyone can become a victim of the roommate scam, criminals often target students heading back to post-secondary school. If you post a roommate listing online, be aware that some responders could be scammers trying to steal from you. Keep reading to learn how the roommate scam typically unfolds.
How the roommate scam works
- The victim will post a roommate listing online and receive an email from an “interested” renter.
- The renter/scammer will ask for the price of rent, utilities and whether there is any deposit fee.
- The renter/scammer will then explain, through a series of excuses, why he or she cannot meet to view the room. For example, they may be overseas finishing medical school or are out of town for the summer.
- Next, the renter/scammer will send a large cheque as payment for the room, well above the cost of rent. For example, the room costs $800 per month but the renter/scammer sends a cheque for $2400.
- The scammer will claim the extra money is to cover their airfare or luggage fees and should be sent to either a third party or directly back to the scammer. The victim will do this.
- Later, once the cheque from the renter/scammer is processed, the victim will discover that it was fraudulent. The victim won't receive any of the funds promised by the renter and, worse, they have handed over some of their own money right back to the scammer.
- In other cases, the criminal might claim he or she may have sent a larger payment by accident. However, it’s important to know that the outcome is the same; once the seller sends back the “extra” funds, they’ll discover the payment was worthless and fake.
Here’s an example of a scammer’s email to a roommate posting:
I’m very interested in renting the room you posted online. My name is Emily and I’m 23 years old. I’m a friendly, quiet and clean person who is currently studying in England.
I’m planning on moving to Canada to complete a semester abroad and I really like your place. I’m available to move in right before school starts. Can you please confirm the cost of rent, utilities and any other fees? I would really like to secure the room before my arrival to the country, so I’ll get my uncle from the United States to send you the payment immediately.
All you need to do is deduct the cost of rent and send the remaining money back to my uncle so he can buy my plane ticket and cover any luggage fees. I’m a trustworthy and dependable person, so I’m sure we’ll get along just fine!
Please provide me with your personal information and current mailing address so I can continue with the payment process.
- The criminal doesn’t request any pictures of the room.
- The scammer asks you to remove the posting from the Internet.
- The criminal is willing to immediately offer you money, well above the cost of rent, and inform you to send back the remaining to a specified third party.
- It doesn’t seem right to you. Why would the person send you a cheque for more than the amount of the rent and ask you to send the remainder back? Why wouldn’t they just send the correct amount and then pay their other expenses themselves?
Tips on how to avoid the roommate scam
Thankfully, there are some tips you can follow to make sure you don't end up a victim of the roommate scam:
- Arrange to meet potential roommates in person.
- Ask for their phone number, full name and references (such as past landlords or employers).
- Refrain from giving anyone your financial or personal information.
- Avoid wiring money in uncertain conditions or to someone you do not know.
- Beware of renters who send more money than you’re asking for. If you receive a payment that is more than the agreed amount of money, refuse the payment.
- Ask for the first payment in cash or have it sent to you electronically rather than by cheque. Electronic payments such as email money transfers or wire transfers are quick and the funds are guaranteed. Cheques and money orders can be fraudulent and it can take a number of days, or even longer if the cheque or money order is from a bank outside of Canada, for your bank to discover this. You are responsible for any fraudulent cheques deposited into your account.