Most of us have received at least one email from a scam artist trying to phish for information or plead for money on behalf of a “Nigerian Prince.” These types of fraudulent messages have been around for decades now, and they don’t seem to be going out of style any time soon.
These scams target online businesses with access to personal and financial data. With the popularity of vacation rentals and the price tag attached to vacations, as a property manager you may easily be caught in an online scheme.
Over the years, some scammers have become much more sophisticated, leaving even the savviest among us, vulnerable to falling prey to a fraudster.
Given the fact that international travel is on the rise, you may have to work harder to distinguish scam emails from legitimate inquiries from a traveler who simply doesn’t speak English.
Here, we share some different types of red flag messages to watch out for along with tips to protect yourself from different types of vacation rental fraud.
Red flags to watch for in your short term rental business
Poor grammar in inquiries. One of the first telltale signs that an inquiry is from a vacation rental scammer, is poor grammar and punctuation, strange spacing and line breaks. This might seem like a legitimate inquiry from someone in another country, where English isn’t spoken, but it could also be a scammer pre-screening your levels of naivete and patience.
Blatant discrepancy in details. If the potential renter is referring to your apartment as a cabin, that would suggest you are being included in a mass message and the scammer is hoping you either do have an apartment, or that you don’t notice their error.
Says the vacation is a surprise for someone. If the inquiry suggests that the trip being booked is a surprise or a honeymoon for someone else, this is done to generate a sense of warmth while creating distance.
Dates are specified and then changed. If you receive an email where specific dates are given and then you’re told that dates are flexible, or if an extended stay is requested and it’s off-season for your location? That should be flagged as suspicious. Take care in dealing with a request like this. It’s likely a scam.
There are other types of vacation rental scams out there, soke of the more popular being the "overpayment" and the "smoke and mirrors" scam.
The overpayment scam
The overpayment scam is a very common scheme. This is where an individual sends you a money order or cashier’s check for more than they owe. Before your bank has a chance to find out that this is actually a counterfeit or stolen check, the “renter” asks you to refund the difference.
These scammers will most likely claim that their travel agent or financial department made a mistake and they need the funds returned to them. If you do send them back the funds, you likely won’t ever hear from them again. A red flag for this type of scam is if the potential renter is insistent in paying with an unsecured wire transfer, money order, or cashier’s check.
Other renditions come in the form of a reservation made via credit card; however, the “renter” will reach out to see if you can refund them by bank transfer because they can’t receive the payment back on credit card. Of course, with this type of scam, the perpetrator is using a stolen credit card.
If you find yourself a victim of this type of vacation rental fraud, take one or more of the following steps:
- Cancel the payment and insist on an exact amount
- Check with your bank: the funds may appear before the fraudulent check is detected which can sometimes take up to a month
- Refuse to wire money via Western Union or MoneyGram; the funds cannot be canceled, retrieved or traced
- Be firm about your payment policies
The smoke and mirrors scam
In this scheme, photos and property descriptions from legitimate vacation rental listings are posted elsewhere online to attract renters. The fake listing is priced lower, causing the actual listing to be overlooked. When the prospective guest comes across your original listing, or if they book the counterfeit duplicative and find it's fraudulent, they may flag your actual rental as suspicious. One way to avoid being caught up in a smoke and mirrors scam is to watermark your photos.
There is a lot of opportunity in the vacation rental business, and as such, scam artists will continue to try and make money off of your hard work. Be vigilant as you review inquiries.