Fraudulent 'Owners'

My website along with several others were hit this year by a fraud.  Whilst we were not affected financially, a number of guests were. They were the victims of a fraud that lost them about 15,000euros between 6 people. This was the amount just through my website on just one property.

As soon as this was made aware to me I commenced investigations along with one of the victims.  The person committing the fraud has now been arrested. It transpires that he was part of huge gang operating through rental websites all over the world. The fraud could run into millions.

If anyone has been caught by a similar fraud whereby you paid for your holiday direct into the persons account and the villa did not exist. The bank are liable to repay the money to you.  This is because they have agreed to open an account for someone with false credentials.  There is a little more to it than that but I am not legal person.  Suffice to say contact the bank concerned and see what they say.  If no joy go to the banking ombudsman.

To try to alleviate this problem I now request from all new advertisers a copy of their escritura for their property.  This at least should provide some security for potential guests.  It would wonderful to think that all other property portals would do the same.  That way we can help prevent this type of fraud happening again.

If anyone would like details of the person arrested please get in touch.

Phil

This message was last edited by chelseaphil on 10/8/2008.

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That would put me off renting my property with you. I understand the implications of the fraud, but an escritura is a persoan; and I believe highly sensitive document. I don't give a copy to anyone for whatever reason. There must be another way to ascertain if the advertiser is genuine?

Mark

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This is an absolutely awful situation and I am sure it caused you a great deal of stress Phil. I am very glad to hear that the 15K euros can be recovered. 

For proof of ownership, how about utilities bill and a copy of the IBI?  These would also include an NIE number.

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Hi Sharon, Yes it was an awful time.  But not so much for me but the poor guests that booked their holiday.  One of them was for a 6 weeks honeymoon!! Luckily I managed to find all of them accommodation albeit not all via my own site.  I just did what I felt I could do for them.

They will get their money back but too will take many months knowing banks.

Phil

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That is an awful thing to happen.

Perhaps you could ask for supporting documentation similar to that required under Decreto 218. I know that this only applies to estate agents offering properties in Andalucia and that portals are exempt providing that they are just an advertising means for owners but like you say it may offer some more security to your customers. For all our rental properties we ask for the IBI receipt and up to date Nota Simple. If we can we also try and get a copy of the latest electric and/or water bill and take a copy of their passport or NIE. Obviously you wouldn't need to collate all of this but if the owner is genuine they should have no problem providing you with some proof of ownership. If they were renting their property in Andalucia directly with an agent then they would need to do this.

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Always a good idea to ask for last water and electricity bill, sometimes these are not paid by the owners up to date and no fun arriving on holiday without water or electricity.

www.selectspanishrentals.com

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The utility bills can be in the name of the tenant. 

Many years ago, actually in 2000 I was working at a small agency in Fuengirola. A guy seemed genuine, came in to rent his villa via us for the summer. My boss went to look said yes and advertised it. A while later the owner came in as the proeprty was rented long term by the original guy! The owner was only fed up not to be getting more money in rental!!!!!

However, my boss thereafter demanded the escritura as proof of ownership - the nota simple will do and is a simple copy of the proeprty details with the owners info. It is law to have this in Andalucia for sales OR rentals and does not give sensitive information as the escritura does.

Hold your ground Phil and ask for that. I awlays did and if refused, I thenrefused to ake the property on - genuine owners will not have a problem with this.

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With respect Gerogia, it works both ways on the Internet. How do you know the person you have to send your details to is genuine? Visitng an agent at their registered premises and presenting the escritura to show ownership is completely different to scanning a copy and posting/ emailing it into the ether. I realise Phil has had a bad experience recently, but it will now be the only holiday rentals website I know of that requests such sensitive information. Again, with respect to Phil, I don't really know him from Adam, I have never met him, so why should I want to send him my escritura?

Mark

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Markfish. I feel somewhat surprised that you are against a process that would help the rental market maintain a decent reputation.

Let me put this to you.  Would you, as an owner that depends on rental bookings prefer to advertise with a company that looks after the interests of BOTH tenant and owner? Or one that does not care about either.  The rental business is going through tough times at the moment. What with the credit crunch and too many holiday homes to choose from.

So it is of paramount importance that the industry stops ALL type of fraud on property rentals.  There has been recent publicity in the Sunday Times about a fraud on holiday rentals in Majorca this year. Publicity like this is not needed.  At least I am doing something about it. Unlike other bigger sites who appear to be doing nothing to prevent this type of fraud. It is not just me that had a problem with the fraud.  There were at least 4 other websites that had the same fraud happen to them.  There were many more on a global scale.  This fraud was a multi-million pound fraud involving a large number of people.

If I was a potential holidaymaker I would certainly only look at those sites that offered some form of surety about the properties that were advertised.  I often get emails from guests asking if such and such a property does exist and if the owners are genuine. So it is a concern for many people. Especially those that are venturing into the self made holiday for the first time.

I canvassed all my owners and of the 137 that replied ALL of them thanked me for what I was doing and felt it a great idea. Indeed it was several of the owners that actually suggested the escritura copy.

I have been running my site for nearly 8 years. And in that time have helped owners to achieve a steady flow of bookings.  Similarly, I have tried to help holidaymakers find an appropriate holiday home to rent. 

You provide more details to a web site when you register your personal details than what is contained on a nota simple or the front page of an escritura.  Things like name address, credit card details. Do you know the owners of the websites you advertise on personally?  There is absolutely no difference in adding your details to a website and proving that you own a property by emailing a copy of your nota simple.  At least the second option cannot be used in any way to commit a fraud against you.  Unlike providing your address and credit information.

I would also have thought that any website that has been running for a number of years  and carries hundreds of properties for rental would indicate an honest and genuine site.

In most cases you have no idea who the people are that are renting your property.  You may never meet them yet you are happy to allow them to stay in the property.  Several of my advertisers have had trouble with tenants this year.  Not all booked through me I might add.  Which is why I set up a special page that only owners can access that they can see a list of bad tenants.  A further example how I try to look after the interests of both owner and guest.

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What I am saying is that is is al being slewed towards protecting you from fraudulent advertisers. I know from this forum that your website exists, but someone else may not. It is very easy for someone not pc savvy to enter a cloned site (why do you think phishing emails are so popular?) and extract details from you. With credit card details, you are protected from fraudulent sites as most card companies now offer such cover. What cover is there for me if I am a victim of fraud because I sent my escritura? I would never knowingly give anything official with my address and account numbers on it (i.e. bank statement, electricity bill, credit card statement) to someone I had never met as all of these can be used against me as a means of proving my identity, and therefore open me to potential fraud.

I accept credit card payments via Paypal and another rental company. Paying by these means ensures that the potential customer is covered if I do not exist under section 75 of the consumer credit act, perhaps more owners should be persuaded to use this means of payment? Paypal is one of the most aggressive charge back merchants there is, if they even think there is a possibility of a fraud the monies are returned to the payer.

I am not saying do nothing, but I feel that the escritura contains too much personal information that is not for anyone elses eyes except me, my solicitor and anyone purchasing in the future.

Mark

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Sorry, I have to disagree with you.  It is not protecting me from fraudulent advertisers it is protecting the potential guests.  I do not lose any money from it.  I know for a fact that one of the other sites did nothing about it at all.  They did not show any care towards the guests that were affected by the fraud and washed their hands of the situation.

I repeat, when you register with a site and pay for the advert using a credit card those details your address is stored in the database of the website owner.  Which is more information than on the front of your escritura or nota simple or utility bill.  So I cannot for the life of me see what you are concerned about. Any account numbers or NIE numbers can be blacked out.  If a website owner was there to commit fraud it would be very easy to do so using the address and personal details that you provided at the time of registration.  It is also possible for them to attain copies of your credit card number if the site was set up that way.

You come across as thinking that I am doing all of this to protect myself and the website.  I have nothing to protect, except the interests of the owners and the guests.  And of course the industry as a whole.  You appear to have the attitude that 'this guy is too good to be true'. In that I am actively trying to help people and NOT make any money out of it. 

Because I am not as big as the 4 major rental portlas means that I can provide a more personalised service to both owners and guests.  Which is greatly appreciated by them. Just read some of the testimonials on the site, all of which contain the ref number for the owner. 

I have not seen any suggestion from you that would be acceptible by owners that would help prevent any fraud.  Unless of course it does not bother you.

The idea of the escritura / utility bill is the only one that will not cost owners money.

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Being new to this market and obviously not as experienced as you are in this matter, I can only speak as I find. Fine, the 137 you have polled have said super, great, smashing, but they are exisitng advertisers and know your track record. I think you would find it more difficult to sign up new advertisers, especially with the amount of research people are wiling to undertake these days. 

I have not seen any suggestion from you that would be acceptible by owners that would help prevent any fraud.  Unless of course it does not bother you

Now you are just making childish coments to what I thought were some serious points I was putting across. I have agreed, something needs to be done to protect ALL PARTIES and not just one. Why should you protect the renters more than the owners? Surely it is the owners that will be paying the advertising charge? As the more experienced, it is up to you to decide what you wish to do with your website, I can only speak as an individual that would give your site a miss if I had to provide this information.

I have already mentioned the way I try to reassure renters using credit cards for payment. You could also offer a escrow service for payments whereby payment is not made to the owner until such time as the holiday is completed, one of the companies I use uses this system.

Mark

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Since I introduced the scheme on the 1st October I have added 8 new properties to the site and all have happily provided me with information to show their property existed. 

If the site you use that takes money on behalf of the owners and then sends it on is the one I think it is. It is a free site but they take a commission, they are the ones that did not want to know about the guests losing their money.  They forwarded the funds on to the fraudster even after the guest had reported to them that the villa did not exist.

I have already stated that I protect the owners AND the guests as much as I can.  So I am confused as to your comments:

 "Why should you protect the renters more than the owners? Surely it is the owners that will be paying the advertising charge?"

Without renters there would be no business for owners.  Which is why it is crucial to try and ensure that all properties do exist.

Many renters do not want to use credit cards. Lots of owners do not like using Paypal or Worldpay.  So an all encompassing solution is required.  I would be interested if anyone can come up with a better solution.

You are also the only one out of those whom have replied in this thread that has this problem over sending the excritura or utility bill.  You have not replied to my comment concerning the difference between sending those documents and supplying your personal details to a website that you have never met the owners of.

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I don't send my personal details to owners of a site I don't know, I use a bank's/ cards secure servers when I make a payment.

I may be the only one (who is not in the industry) to pull you up on this, but do my thoughts as a potential client not count? Why are you so right in your thinking and I am wrong? Surely we both have valid points, the trick is to encompass all sides in the best possible way and I don't think providing the personal details in the escritura to be the way. I would consider a utility bill or IBI bill, but only if anything that could be used in a possible fraud against me were removed. As you are a fee paying site, perhaps you could check against the land registry as part of your checks to give your renters peace of mind? I am sure access to this is as available as the electoral roll in the UK? As I say, the internet is a very anonymous affair and it is only the online sites I would have a problem provifding this info to.

I realise a lot of renters don't want to pay by card, none of mine did this year, but the option was given for peace of mind as well as an escrow serice. I notice the preferred method of payment on your site for advertisers is by cheque or money transfer, that's a no no for me?  Paying by Paypal would be my preferred option if you have the upgraded account that doesn't require registration. See, if I paid with my card, I would have more peace of mind than if I had to give you cash or a cheque as I know there is someone to go back to should there be a problem as your fees are over the magic £100 to qualify for protection under the consumer credit act. Personally, I would always go with someone that took cards than someone who didn't, that is the self preservation in me.

After you have gone through all of this trouble, what says the house/ apartment/ villa isn't to be repossessed in the next month? The bills are up to date and that there is electricity/ gas for the clients when they arrive? Isn't that as bad as having no property to go to? Unfortunately you can't cover all bases and the phrase "buyer beware" should always be in the forefront. Contact details are a great thing to have. A landline telephone number has got to be more preferable tan a mobile number. A Spanish site I use puts a big warning triangle against rentals with no telephone number as potentially there is no means of contacting the owner.

At the end of the day, I am a genuine owner with some successful first year rentals. I won't be coming to your site to register as I don't feel happy/ safe/ whatever handing over private information (although it doesn't actually say on your sign up page this has to be provided) to someone I have never met. I would hapily find other means to identify myself as the owner, but as I am not the one wanting to implement this extra check, it is not my responsibility to think of ways to do it.

I think we are going to have to agree to disagree on this one.

Mark

This message was last edited by Marksfish on 10/18/2008.

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You are right this debate can keep on going.  But I do feel I need to clarify a couple of your lasts points.

"After you have gone through all of this trouble, what says the house/ apartment/ villa isn't to be repossessed in the next month? The bills are up to date and that there is electricity/ gas for the clients when they arrive? Isn't that as bad as having no property to go to? 

This is a pointless statement because no matter what efforts one could provide to reassure a guest; if your scenario were to cone true nothing could be done. It is a case of one of those things and I am sure an amicable arrangement would be mad e between the owner and the guest.

My site charges £95 a year so does not qualify for the Credit Card protection.
Many villas are in rural locations as indeed where I live. No landlines are available so phone numbers cannot be used as tool.

I am more than happy to listen to constructive methods / criticism provided they are just that. But not to being accused of doing things to my own benefit.  When all I am doing is to try and protect the rental industry in a way that is acceptable to most.  Ask the guests that lost nearly 15,000euros between them how they feel.  They have all told me the would never use a site that did not indicate that some kind of check had been carried out that the property did exist.

To access the land registry database costs money and owners have enough to pay out for without having to pay an additional fee for this to done on their behalf. Reasonable idea though for those that may prefer that as an option to providing excritura details.

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Sorry, I thought I had read £95 +Vat. I did mention though that you do accept Paypal, so even there, there is a recourse of action when making a payment as Paypal will invesitgate all complaints.

Yes the registry check does cost, but imagine your USP in stating that all properties had been checked against it? I am sure an annual access fee is able to be paid as well as on a "per property" basis, would it really add that much to your subscription amount?

Unfortunately, the only way UK renters are guaranteed to be safe is to use an ATOL or ABTA bonded travel agent. People are using these rental sites because they don't want to pay the extra costs travel agents levy to cover their registration of these organisations.

Mark

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Chelseaphil and Mark

Having read the previous posts, we have to agree with Mark on this one.

We would not send such personal data to any site for advertising our property, whether we knew them or not. Where is this data you require stored? on computer? filing cabinet, how safely is it stored?
Any one can set up what looks like a legitimate site, or even copy a legitimate site. 

I work in the finance industry and am fully aware of identity theft and the like obtaining credit with fraudulent utility bills. I am sure if some one wanted to, they could easily forge the escritura as you do not check them with the land registry. Just as we see forged passports and driving licences.  

Even if we felt we lost a few bookings by not giving the escritura or utility bill to a rental site, so be it. we know we are legitimate owners and pay all our taxes etc, as our solicitor would tell you. 
Maybe a solicitors letter would suffice for you to believe a legitimate owner.
Like Mark we are happy with the way things are and would not be signing up with you or any one who asked for the escritura.

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I fully appreciate what you are saying but the details on a utility bill are no different to those that you supply to a website when you register with them. They all ask for an address and phone number and email address.  Any account numbers can and perhaps should be blacked out.  You say a website can be copied which also implies that one of the larger sites can be too.  So what is preventing a potentrail fraudster from copying a site and setting up a registration system that stores your address and your card details and using them for identity fraud.  There is absolutly no difference in that and asking for a utility bill.

I am not saying that people are not legitimate only that it is my view that because of this fraud which will at some stage hit the newspapers.  It is vital that the rental industry, that means both owners and website owners get together to prevent fraud. 

I have just had another new property added to the site this evening and the owner is more than happy to provide me a utility bill with his account details blacked out. He said that he appreciated what I was saying about preventing fraud and thought it a positive step.

The escritura shows nothing more than the fact that you own the property. If your NIE number is on it that can be removed.  Why is it that you do not appear to want to help prevent fraud? I cannot understand it.  If the press do get hold of this story imagine how many people may reconsider booking their own holiday apartment or villa.   It is feasible that it could have a massive impact on the rental market.  People will be looking for reassurance from websites that the advertisers are genuine. 

All I am trying to do is to find a solution to what is and could be a major problem for the industry.  Or is it a case of that some owners are not too concerned if the odd guest gets taken for a few thousand euros.  

Personally, I would sooner have owners that I know are advertsing their own property and have proved it to me than owners that are not worried about potential fraud against guests. 

I say again, put yourself in the position of those guests. How would you feel if you used a web site that had someone advertising a property that did not exist and you lost 6000euros having booked a 6 week honeymoon.

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Chelseaphil

we have every sympathy with people who have lost money by fraudulent sites, we personally would not part with thousand of euros without some form of security . We agree something needs to be done to stop this happening, but not convinced that you have the answer.

Could you prove your site is legitimate if you had to?

We get numerous "phishing" mails from what look  like official banks - ones we don't even bank with.

As you say the details on a utility are the same as you would supply in many cases, but its the actual bill you want to see, which can be "doctored" for fraudulent use. Are you aware they can be bought on the net, so if you are determined to commit a fraud, there is always a way to do it. Unless you know what to look for. Can you spot a fraudulent utility or escritura?

Blanking out NIE numbers and account numbers is not the answer, we would not join a site that required it.

As i said previously I work in the financial industry and know more about fraud than the average person, it is part of my job to detect and report it.

I am glad to hear people are still joining you, unfortunately people get caught out everday by trusting too easily and being careless with personal papers.  

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The fact that my site has been running for 8 years is proof enough that it is genuine.  It has lasted longer than many others that have come and gone.  All someone has to do is to type into a whois search engine and they will get proof.

Almost every property owner requests that payment for their holiday home rental is paid in two parts. An initial deposit to secure the booking followed by payment in full 4 weeks prior to departure.  What security can you offer the guest that has just paid you a couple of thousand euros that your property actually does exist?

The website that Markfish uses takes ALL of the money up front and retains it until the holiday has started. Where is the guarantee that the property does exist?  If this company is the same one that I know of. They paid out to the fraudster AFTER being warned of him and still advertised the property for several months afterwards.

You say you would not pay all the money upfront without some form of security; what security would you expect and what do you provide to your guests? 

There are ways around everything when it comes to fraud, anyone thinking otherwise is naive.  But providing some sort of proof of ownership must surely be something.  Particularly when the website is established and respected by its advertisers. 

What you and Markfish have been indicating is that you do not trust me or my website.  Granted this may not be what you are intending.  But the terminology about spoof websites fraudulent use of bills etc does indicate this.  If someone is dubious about a site, check the testimonials and then contact the owners that are advertising.  Would you both feel the same if you were dealing with one of the larger companies that have tens of thousands of properties on their books and just a four or five hundred?

I have still yet to see anyone come up with a better solution to help prevent fraud.  As you know so much about fraud through your previous work you must appreciate that when someone tries to do something about it they need support or constructive suggestions.  Not negativity.

OK, bills and escrituras can be 'doctored' but so can driving licenses, passports and everything else.  Even a solicitors letter can be made up.

When someone opens up a bank account they have to produce utility bills and another form of ID. Same if you need to open an on line account with a currency exchange company.  So how does anyone know that these people are not fraudsters?  What is the difference between this and what I request? 

As I was involved with the tracking down of this fraudster I know that he opened a bank account in th UK with fraudulent bills. So banks cannot tell a wrong one from a genuine one. 

I think everyone gets bank phishing emails but how many have you had that are for other types of web sites? Personally I have only had one or two and they were for Google Accounts. 

If blanking out NIE and account numbers does not work, why not?  The result is the same as when you register your address on a website.

There has to be some element of trust given and accepted.  Trust between the website owner and the property owner, and turst between the proeprty owner and their potentail guests.  Without that trust there would be no business for anyone. Indeed it is how I run my website.  By trusting owners to pay for their advert AFTER it has gone live. I have only been let down maybe half a dozen times in 8 years.

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