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Landlords is your Agent protecting your Asset ?


Even while the risk of fraud increases, agents can use tech to help spot suspicious activity, as Nishma Parekh, Head of Referencing at Goodlord, explains.

The risk of tenant referencing fraud will always be important for letting agents, but technology can help. Here’s everything agents need to know to reduce fraud during the referencing process. 

Fraud in tenant referencing is becoming an increasing concern among agents. Goodlord analysis in 2023 found that just over one in one thousand references are flagged as fraudulent. Whether this is due to the cost of living crisis or the rise in rental prices, fraudulent applications not only affect the supply of rental properties but also the price landlords and letting agents need to pay to evict tenants. 

Thanks to changing eviction regulations, rising economic instability, and the increased accessibility of tools needed to forge documents, it is no wonder why there is a rise in cases of fraud for pre-tenancy referencing.

However, alongside this, new methods to prevent and detect fraudulent activity have also emerged. Here’s how agents can leverage new technology to spot counterfeit applications and protect their landlords from rogue renters.

What to look out for before the referencing process

Before the referencing process has even started, a letting agent or landlord should meet their prospective tenant in person. Even with all the tech in the world to help prevent fraud, getting to know your tenant can go a long way.

Agent - you've met the tenant, right? - Use your knowledge and expertise. If something seems suspicious, it might be. If one guy is looking to rent a five or six bedroom house - ask about their need. Do their reasons seem legitimate?

Before the actual referencing has started, processes such as holding deposits can tell if a tenant can afford to live in the property. Did they pay their holding deposit easily? Or was there some pushback in getting that initial payment?

With the increase of Right to Rent fines this year, letting agencies must check they are doing the most comprehensive to avoid being caught out. This creates another level of security for agents to minimise the risk of fraud.

Does the tenant have the correct immigration status or share code? Not conducting a comprehensive check will affect not only the letting agent with a nasty fine but the landlord as well.

How to spot tenant referencing fraud

The most common forms of fraud we identify during our referencing services typically involve one of the following:

  • Fake forms of ID being submitted;
  • Doctoring of documents around income or residential status;
  • Fake references from employers or landlords.

The falsification of these documents is on the rise, so knowing to check them carefully and put in place measures to spot forgeries is vital. 

Document verification in general relies on more checks, so processes such as open banking - where income is verified directly at source - will also significantly reduce the chance of income fraud in tenant referencing.

Find out more about open banking with our guide

How is technology helping to combat the rise in tenant referencing fraud

The best way to avoid tenant referencing fraud is to set up your referencing process to catch fake documents. Letting agents, through the referencing process, should spot any issues with an ID by making the most of new technology to verify identity.

The three key check areas that are integral to building a financial picture and support in identifying fraud are:


Identification checks are a key part of the referencing process - to make sure that you know who you are letting a property to.

Some companies, such as Vouch, use artificial intelligence (AI) tools such as Identity Documentation Validation Technology (IDTV), to check ID documents remotely can match genuine tenants to their identity documents.

All a tenant has to do is scan their ID and snap a selfie, and then an accumulation of AI, cloud technology and more will verify whether their ID is genuine. The ID will then be checked if the facial biometrics match the selfie taken.

This technology - which is also used to match people to their passports at airport eGates - ensures that the reference that is generated is only for the person who has imputed the data.


It is important to check whether a tenant has any adverse credit. There is always a risk that a tenant could fall into arrears - affecting your agency and your landlords.

Obtaining a credit profile from a Credit Reference Agency, such as Equifax, gives added reassurance that an individual’s financial footprint can be found online.

Tenants can see if they have a tenant profile by checking their credit score and report. Having this information available to referencing providers gives more credibility to the tenant, so letting agents should encourage tenants to check if they have a financial footprint.

There are genuine reasons why someone may not have a financial profile - for example, they may have only recently moved to the UK or are a first-time renter who hasn't used any lending products.

However, during the referencing process, not finding a profile where there should be one is a flag that should be investigated further.

Over half of tenancy fraud involves fraud - find out how here


Tenant referencing fraud often stems from providing fraudulent data on income. In 2023, Goodlord reported that over half of tenancy fraud involves fake payslips. To minimise that, using open banking can have access to a tenant’s financial information straight from the source.

Open banking is the latest tool that is being used to verify tenants' incomes. Tools like Tink, an open banking provider, allow us to exchange data between us and the applicant's bank securely.

Open banking is becoming more common and, as understanding of its benefits increases among agents and tenants, we are seeing a rise in its adoption. The introduction of open banking has reduced both referencing turnaround times as well as fraud as it eliminates human error.

Open banking, which has been in use since 2018, enables us to verify a tenant's salary information directly with their bank. This speeds up the financial checking process with a system that is not able to be fraudulently manipulated.

The same cannot be said for the use of pay slips, which are often the first thing to be falsified. Look for suppliers that verify income at source, or other methods - such as integrations with payroll providers or with HMRC directly. 

Find out more about open banking with our guide

What your agency should consider after a reference is complete 

Even with the most secure tech-savvy process in place for your referencing, there is still the possibility of fraud taking place. As the tenant referencing check technology advances, the techniques to commit fraud advance, too. It’s always worth considering taking out a Rent Protection service to help with any costs should a tenant stop paying their rent.

Following the cost of living crisis, many are struggling in the current economic climate. The amount of fraudulent applications is still incredibly small - roughly one in 1,000 - but agents should protect themselves and their landlords from this ever becoming a possibility.

Offering a rent protection service has increased substantially, and is a brilliant safety net that can provide peace of mind to your landlords.

The rise of technology is playing a massive role in both enabling and combatting referencing fraud. But if agents are savvy, prepared and know what to look for, fraudulent applications can be found quickly and easily before it’s too late.

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