Phantom Flats – Hackney residents warned to watch out

Hackney Trading Standards and Hackney Citizens Advice Bureau (CAB) are warning people to take extra care when searching for rooms or property online.

The warning comes following a series of scams asking people to part with funds via money transfer before they have seen the flat that is up for rental.

The scammer will claim to be a landlord living abroad and ask prospective tenants to prove that they can afford to rent the flat, by setting up a secure money transfer to one of the tenant’s own friends and relatives. The prospective tenant is then asked to send a copy of the receipt to the Landlord to prove that they have sufficient funds to pay the deposit and rent.

The would-be tenants are reassured that no-one else can access the money. However, when they attempt to collect the money they have transferred, it has already been withdrawn and the room or property does not exist.

Mr Keklik, a Hackney resident, 31 of Woodberry Down Estate, fell victim to the scam in December 2009. He found a flat on the Gumtree website and emailed the “owner” who asked him to transfer money using Western Union. Mr Keklik’s fiancée transferred two payments of £1000 and £700 each. Mr Keklik then emailed the owner a reference number. When he tried to collect the transferred cash, he found it had gone.

Western Union told Mr Keklik that money can only be collected with identification. Western Union said they are investigating the matter, but have not got back to Mr Keklik, who is now making an official complaint to the Financial Services Ombudsman with help from a CAB adviser.

Steve Douglas, Corporate Director for Neighbourhoods and Regeneration said: “The bottom line is never transfer money to someone you don’t know or hand over your transfer receipt. Doing this is like giving your PIN number to a complete stranger and then passing them your debit card to finish the job. It’s not the same as transferring money from one bank to another, and isn’t covered by the same safeguards”

The CAB wants to work with money transfer companies to help them to tackle the misuse of their services and thwart fraudsters. Since November 2009 money transfer companies have been regulated by the FSA. While they can apply to be ‘authorised’ the only real requirement is that they are registered with the FSA. This involves a lower standard of checks where local money transfer agents are not checked at all.

If you have been affected by any type of scam or need further information, contact Hackney Trading Standards on 020 8356 4929, or call Hackney CAB on 020 8525 6350 or visit the Bureau at 236-238 Mare Street , Hackney, London E8 1HE


CAB tips for safe money transfer

•Never share your money transfer number or copy of the receipt - it’s not secure
•Never part with any money before you have viewed the room or property in person
•Never agree to transfer money, even to yourself, to prove you can afford deposit and rental payments
•If you or the prospective Landlord live abroad, offer to provide references from previous Landlords and other professionals such as a G.P or employer who can vouch for you, rather than transferring money
•If at all possible, meet the Landlord in person and never hand over any money until you have seen a written contract and checked it over
•Do a Land Registry check to confirm that those who say they own the building actually do own it. See for more information.
•All Landlords must be part of a registered Tenancy Deposit Scheme which protects your deposit. One way to check any prospective Landlord is legitimate is to ask for the details of which scheme they’re registered with and check that they are part of the scheme. See for more information.
•Use a reputable letting agent from the High Street, who is registered with the National Approved Letting Scheme (NALS). Agencies belonging to this scheme have agreed to follow a set of standards which include a complaints procedure.
•If you need to make a money transfer, you can visit the FSA site: for info on how to check out a firm’s credentials and what you can expect.