Elaborate online rental scam in Ontario

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Cybersecurity expert says fake online ad scams are becoming more sophisticated.

Jake Eakley thought he’d found a great deal on the perfect Toronto apartment for him and his fiancée to start their life together.

But the Oakville, Ont., couple quickly learned that if something seems too good to be true, it probably is — and they narrowly avoided losing $4,400 in first and last months’ rent to an alleged scammer.

Eakley and his fiancée, Alejandra Gil, are sharing their experience to warn other prospective renters about an elaborate rental scam they say is preying on those trying to find a quasi-affordable apartment in Toronto’s red-hot housing market.

Eakley said “It’s very hard to find a place” and “for people to have to also worry about this, it’s sad.”

Merchandise scams — which involve fake online ads for everything from puppies to apartment rentals — exploded in Canada during the COVID-19 pandemic.

Money lost through these scams ballooned from $4.3 million in 2019 to $14.4 million in 2020 and almost $12.3 million in 2021, according to the Canadian Anti-Fraud Centre. 

Pitch came from alleged retiree in Spain

In the beginning of March, Eakley came across an ad on the rental app PadMapper for a two-bedroom loft in a condo building in Toronto’s Liberty Village neighbourhood for $2,200 a month.

“I woke up and Jake had his phone, and he said, ‘I just found the next place we’re going to live,'” Gil recalled.

“This [rental] checked all the boxes.”

After responding to the ad, Eakley was contacted by the purported owner of the condo, who introduced himself as David Terrance, a Canadian retiree living in Spain.

In emails reviewed by CBC News, Terrance explains to Eakley and Gil that he bought the condo for his son, but because his son is now studying abroad, he was renting the unit remotely from Spain.

Terrance told the couple he wanted to use a third-party real estate company.

The couple were told the company would send them the keys to the loft and a copy of the lease agreement after Eakley and Gil transferred $4,400 to the company for first and last months’ rent. The money would be held in escrow until they visited the unit and decided whether they wanted to rent the loft.

Eakley immediately thought something was wrong and said “that’s where the really big red flags came out, we haven’t seen the place yet, and you still want us to pay first?”

Terrance also said they’d need to send the third party a copy of their photo IDs to confirm their identities.

At that point, the couple still weren’t completely deterred because they also received emails they thought were from the third-party real estate company confirming the process the alleged scammer described, providing paperwork to sign and appearing to confirm Terrance’s identity with a scan of a Canadian passport.

CBC News contacted the alleged scammer at the email address that was used to communicate with Eakley and Gil for this story but never received a response.

Third-party company real but not involved 

NAI Global, the third-party company whose name and logo appear on the emails and paperwork the couple received, does exist, but it doesn’t work with residential buildings. The New York-based real estate firm deals in commercial properties.

In an email, president and CEO Jay Olshonsky told CBC News that the firm is aware of the scam and has reported it to police in Canada and to Craigslist, a classified ads website.

Olshonsky said “someone is using our name, we have nothing to do with this and we respond to all that contact us telling them it is a scam.”

He said the company has been contacted at least 20 times about the scam.

There are also several warning posts online that quote rental scam emails using the same story of a retiree in Spain that the Oakville couple received. But instead of the Toronto loft in those emails, the retiree was looking to rent condos in Kitchener, Ont., Calgary and Victoria.

The most recent post provides the same Spanish phone number that was given to Eakley and Gil but uses a different variation of David Terrance’s name.

Scams becoming more ‘sophisticated’

Based on the details of Eakley and Gil’s experience, cybersecurity expert Ryan Duquette said he suspects the scam came from some sort of organized group.

“We’re starting to see scammers out there becoming a little bit more sophisticated,” said Duquette, national lead of cybersecurity for RSM Canada in Toronto. 

“They are providing these things like a passport or other official-looking documents, a company that’s going to hold the money in escrow, which entices that person that this is real.”

Duquette said the biggest warning signs that something could be a scam are when the person renting out the apartment is not able to meet in person and is asking for money upfront.

Loft owned by someone else

For Eakley and Gil, the final straw came after they asked a real estate agent they know to look into who owns the Liberty Village loft. Property records showed the real owner’s name was completely different.

“You can’t lease a place that you don’t own, so that was kind of when we knew for sure that this was a scam and that we shouldn’t move any money” Eakley said.

The couple contacted Toronto police and are waiting to speak to an investigator.

“Always trust your instincts,” Gil said.

“If it sounds too good to be true, sadly, it probably is.”

This article was originally sourced by www.cbc.ca.