A Simple Rental Deposit Fraud using QR Code
The Covid Pandemic has introduced a great degree of uncertainty over income. IT has driven down occupancy ratios in hotels, hit the restaurant industry hard and real estate businesses harder. As travel is hit, offices, colleges, and education go online, lots of rental properties across the country remain vacant. A landlord has to look for places high and dry to attract potential tenants. Landlords put up notices on the property, sound out their friends and family, share in WhatsApp groups, and when all else fails, post on online portals to attract potential tenants.
This is what a 53-year-old woman from Pune did. She posted online on two separate real estate portals about her apartment being available for rent. The fraudster who saw the online advertisement got in touch with her and informed her that he wanted to take the apartment for rent. He mentioned to her that he was willing to pay the required security deposit and agreed on a rental amount.
How the 53-Year-Old Lady was duped
He offered to transfer the money using an online wallet. He sent the lady and her son QR codes for this purpose. The unsuspecting lady and her son scanned the codes and after going thru the process, realized that an amount of Rs.1.64 Lakhs (Rupees One Lakh Sixty Four Thousand) was transferred from their accounts to that of the potential tenant or the fraudster. They had been duped by the fraudster. Instead of being paid the advance, they had been taken for a ride by money being debited from their account.
Given the nature of the transfer and the processes that surround this sort of transfer, the lady and her family may have to wait a very long time to get their money back. And if they get their money back. The likely scenario is that the money has already been withdrawn by individuals that are hard to trace or will involve a lot of work that the system is not designed to solve with ease.
How to prevent QR Code Frauds and Scams
As the author was writing this blog, he received the routine advisory message sent by banking and financial authorities.
It is the message that asks you to stay vigilant for payment requests made by unknown people. There are other messages regularly sent by authorities to people about checking the authenticity of QR codes, payment requests. QR Codes have become ubiquitous and have simplified payments as well as information sharing.
Scanning a QR code brings up several actions which make it clear if the person who has received the code is paying or requesting money. Yet, people are taken for a ride all the time. As technology evolves, it may become difficult for people to understand certain things. Therefore, it is important to make payments where there is significant control over the money. It is wise to use a digital escrow platform to make transfers such as these.
Here is how one can prevent themselves from being duped in these sorts of instances:
1. Check the authenticity of the person - Check their name against obtained identification information such as Aadhaar or some sort of personal information
2. Check the name on the account - Check if the banking account belongs to the same individual. If not, enquire the reasons for the difference in name. Also, check if the account is local and reasons for not being local. Any normal person will provide satisfactory explanations for all of these questions.
3. Enter into an agreement - before entering into a detailed agreement, enter into a brief agreement capturing the basic high-level details of the transaction
4. Request or make payments thru a digital escrow platform such as Vouch. Escrow platforms hold the money until the two parties have completed their respective obligations according to their agreement. This ensures they are both assured of their money
What is digital escrow?
Digital Escrow is the use of a third party account, during a transaction, which holds the money deposited by the buyer until the seller fulfills the terms of the agreement. The transacting parties are supervised by the escrow company.
How does Digital Escrow save you from online frauds in India?
Vouch’s Digital Escrow service is a transparent way for buyers and sellers to build trust and secure a clean transfer of product and payment. Buyers can feel assured that they will be fairly compensated in a timely manner, and buyers will feel confident that their order will be delivered as expected and on schedule. If you ever come across a fraudster asking for OTP, asking you to scan a QR code, or asking you to click on phishing links, you can simply say no and ask him/her to proceed with the transaction through Vouch.
Vouch Digital Escrow uses a non-interest-bearing escrow account for all transactions in India and keeps you updated and informed at every step of the transaction process till the end. Vouch’s professionals are always available to assist you with all queries that you may have during the entire transaction process. There is no scope for deceit or fraud since the payments, shipping, delivery, and execution are carried out under the honest and watchful eyes of the Vouch’s professionals. With Vouch, any business transaction becomes transparent, uncomplicated, and hassle-free.
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This is Fraud Story #36. Check back here for more fraud stories and scams that you can protect yourself from.
Safety is not just about protecting your credit or debit card number. It's about having control of your money till you have had the opportunity to settle your transaction with the other party.
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Note: This is a good-faith initiative to educate the world about how to avoid frauds like these. Do you have a fraud that you would like to report? Please write to us at firstname.lastname@example.org