Combined with application fraud tactics growing more sophisticated, it’s become increasingly important for property managers to detect and manage risk earlier in the screening process.
By detecting application fraud earlier, property managers can proactively safeguard their properties and finances while attracting higher quality tenants. All of this starts with understanding the various types of application fraud.
Understanding the types of application fraud
Navigating the constantly changing landscape of application fraud is a key step for property managers looking to stay ahead of the issue. Managers need to be aware of the various forms fraud can take, and ensure their teams have the tools they need to detect issues.
Common types of application fraud, ranging from subtle document changes to the creation of false identities, each presents their own unique challenges, requiring property managers to be well-informed and equipped with the right tools to effectively identify and prevent risks.
Ultimately, understanding the various types of application fraud is the first line of defense in protecting your properties and financial interests.
In some cases, an applicant may alter the date or deposit amounts shown on their own bank statements to make their situation appear better than it currently is. To the human eye, these documents may look legitimate. The applicant does belong to that financial institution and the statement is real, but digging deeper can show that the data fields were changed.
While a single change may be obvious and flagged immediately, these changes are typically hidden amongst a series of other adjustments made to ensure numbers reconcile and formatting is consistent with an official document.
Alternatively, applicants can look to online services such as pay stub generators to create fabricated documents that look authentic. These counterfeit pay stubs can be sophisticated and difficult to distinguish from the real thing, making it challenging for property managers to accurately assess an applicant’s true financial situation.
Synthetic identity fraud
In another type of fraud, individuals may fabricate an identity by blending both legitimate and fictitious personal information.
For instance, a potential tenant might use a fraudulent Social Security number combined with a verifiable address to form a deceptive identity. This fraudulent identity could then be used to falsely qualify for a lease on a rental property.
Strategies for early detection of modified documents
To mitigate risk, property managers are increasingly looking to technology like automated document verification systems in their application processes to help detect fraud earlier.
Intelligent technologies, like Ocrolus Detect, leverage AI to identify subtle changes in financial documents that could be easily overlooked by human eyes. These tools enable property managers to automate detection processes and more efficiently flag signs of modifications including inconsistent fonts, spacing and formatting.
Ocrolus’ comprehensive fraud signals take this one step further, revealing the context and method of tampering. With our latest feature, the Detect Authenticity Score, property managers can further mitigate risk while also automating and streamlining their review process. In addition to the existing signals and visualizations, this score can be used to assess the authenticity of applicants’ documents, helping managers make the most informed decisions possible in reviewing applications.
Preventing falsified document submission
Property managers can employ several proactive measures to detect and prevent fraud in the application process.
Automating the authentication of crucial documents like pay stubs and bank statements has become a common practice among proactive property managers. This strategy also simplifies the verification process, making it faster and more accurate while reducing the potential for errors that can occur with manual checks.
The use of digital employer verification systems can further bolster this strategy. These systems streamline the confirmation process, making it less reliant on manual labor and more on efficient, automated verifications.
Identifying synthetic identity fraud
To fight back against synthetic identity fraud, the use of automated background checks that use identity verification technology has become essential. These systems go beyond basic information checks, utilizing advanced algorithms to find and flag inconsistencies.
In addition to automated background checks, property managers can also use comprehensive digital ID scanning and authentication processes. These processes look over identification documents, efficiently parsing real IDs from falsified ones.
Multi-factor authentication systems further strengthen the verification process, ensuring the legitimacy of the applicant’s identity. Through a combination of these strategies, property managers can effectively safeguard their properties against the risks associated with synthetic identity fraud.
In an era where application fraud is both prevalent and sophisticated, property managers must be vigilant and proactive in their approach to fraud detection and prevention.
Understanding the various types of application fraud, coupled with the integration of intelligent automated solutions, is essential in safeguarding properties and financial interests. By embracing these strategies, property managers can detect fraud and suspicious activity earlier, accelerating the application process with reliable data.
Book a demo to learn how Ocrolus can help property managers avoid losses and unnecessary evictions by reviewing multifamily applications with AI-driven automation solutions.
- Early detection and understanding of the various types of application fraud are essential for property managers to protect their properties and financial interests from the rising trend of sophisticated real estate fraud.
- Implementing intelligent automated solutions like AI-powered fraud detection is crucial in efficiently identifying and preventing fraudulent activities in property applications.
- With the Detect Authenticity Score, property managers can further mitigate risk while also automating and streamlining their review process. With this score, based on the types of signals Detect uncovers, managers can make the most informed decisions possible in reviewing applications.