BEWARE of fraud by erentpayment.com
Karen HigginsPro Member
Minneapolis, MN · Member since 2017 · 83 posts · 89 votesWe are currently in the middle of a scam by erentpayment.com. They have taken money deposited by our tenants and have refused to pay us. They have been very limiting with information and turned their phones off and are not replying to emails. Cancel all automated payments if you currently use their system. We are starting the legal process to take action. I'm guessing they have taking hundreds of thousands of dollars from people. Help spread the word so others are not hurt by this.
My wife found this company on bigger pockets. She most definitely is in the right, and boarder line obligated to inform the public that a company that used to accept payments from tenants, and disburse the funds to landlords is no longer longer disbursing the funds to landlords. Furthermore, they have shutoff their phones and customer service department, not updated their customers as to the status of their funds, and refused to name their banking institutions or legal representation that they are using.
This is most certainly a fraud, and a large one. If not, they should be updating their customer base as to where their money is at, and when they will get it. This rent collection and payment scheme is the perfect Ponzi scheme. They take a clients money and can move it from bank to bank like it's their own money. (Matt, thats apparently what you think happened). Thus, proving the lack of oversight involved in this kind of business/industry. As long as they can grow their customer base the scheme continues. The creator doesn't even have to put himself out there as the frontman of the scheme, and can hide behind an LLC. Interestingly, Rick S is a "pro" member, claims to be the manager or owner, and has 397 post on bigger pockets. I encourage him to comment, or better yet send me my 13,000$. At this point I doubt either will happen.
I hope I'm wrong, but when the company shuts off the phone and fails to deliver on the "updates" they promise. You have to fear the worse. This company is still accepting "new" money and the public needs to know. I don't want to come across as confrontational, but the public needs to be made aware of the problem/fraud.
Well dang. I've been requiring erentpaymet for all my tenants to pay rent. I did feel like it took a couple of days longer in October to show up in my account, but it all did..... I'm going to believe in the greater good and expect rent checks in my account within 7 days for Nov as well. I think my take from this thread is to not use just one company for all rent payments. Which is kind of a bummer, but I'd be upset and probably use every negative word (i.e. fraud and ponzi scheme) if I was missing all of my rent money too! Yikes!
One of my renters pays by prepaid credit card because they don't have a bank account. Is there anything I can do for prepaid credit card payment made on October 5th?
It doesn't sound to me like he even wants to try to pay people back. At the least refund the processing fees and set up some sort of plan to return the money. I can't believe people are even entertaining the idea of still doing business with him. Even if someone was lucky enough to be outside of the timeframe and deposits came through, look at how they are still handling the situation.
I lost one rent payment for 1k in this whole mess, it was supposed to process on October 6th. I was talking to another landlord and they brought up a point I had not thought about. It is possible that the erentpayment lawyers are telling them to handle it this way because fraud is involved with eCheckit. I have no idea if this is the case but it is a possibility. Hoping that we all get our missed payments soon but I'm not holding my breath. erentpayments.com has always had great customer service so I'm keeping two properties on their system to see how this shakes out. The rest that I had with them will be switched to another service.
@Justine S. - people vote too (look what happened 9 years ago... they did it TWICE)! - what I mean is folks don't always seem to have their best interests in mind with their actions.
Burn me ONCE shame on you (and I also learn NOT to put my hand in the fire), but twice... going back to the SAME company that just hosed us all? Like history - this scenario will repeat itself if one doesn't study it.
Some might find this latest news article interesting. Quoting a few bits here:
"...Due to the irregularities noticed by the Check Commerce, it suspended eCheckit’s ability to submit further transactions.
It also notified eCheckit merchants of its decision to hold onto the existing $4 million, which it stated it had the right to do under the terms of the merchants’ contracts with eCheckit.
....
The company's bankruptcy filing by eCheckit, also known as CC Operations LLC, sheds little light on the source of the company's woes.
The court-appointed trustee in the bankruptcy case, Michael Wheatley, is working to parse the bankruptcy filing, which contains an unusual lack of information, Wheatley’s attorney Peter M. Gannott said.
“We are working diligently to try and find out all we can from (the filing) and are waiting to hear from the debtor’s attorney to set up meetings,” Gannott said.
He added that when a company works with a high volume of financial transactions, it can take a considerable amount of time to sort through the information."
There's more. You can read the entire article at http://www.eastvalleytribune.com/news/tempe-firm-s-m-dispute-sticks-landlords-nationwide/article_1efca9cc-bb6a-11e7-82e9-9b4f5df82688.html
This appears to support ERP's previous (albeit delayed) explanations. It also sounds as though those rent payments are in limbo due to Check Commerce's freeze. Will be interesting to see if the November rents are processed in a timely manner via the new bank.
Interesting updates. I have still not received any missing payments made during the time frames affected. Renters have not been able to claim R10 or R7 reversals via their banks, so Check Commerce still has all of the funds. I have not received any communications from ERentPayment regarding updates or answer to my question last week about why their deposit reports of record were changed by them between 10/20 and 10/26. Changing records, reports and documentation is not good and presents another type of potential fraud or deception. I hope that this is not the case by ERP, but not response or explanation is not a good sign and makes a huge concern regarding the integrity of their reports and documentation. I only found this when going through bank deposit reconciliations. ERPs deposit report showed "processed". Bank statement/report showed that the "Processed" deposit was not received. Then, 6 days later, the same report was pulled again from ERP and the previous "Processed" deposits on the report were removed by ERP.
Hello all,
I have been following the thread as I also used Erentpayments they have sent the first email. After multiple inquiries. It is a generic email stating what their website had previously said.
We have stopped all payments after the incident but have not received 2 payments that were posted on and after the 3rd.
We advised our tenants to have the banks reverse the transaction and offered our tenants a $50 credit to do so. One, because we want to see our funds. Two, because it will take some effort on their part with filing the dispute.
I hope this gets cleared up and all funds are distributed accordingly.
Good luck.
Sincerely,
Mark Proctor
I am late to the thread as only one tenant and payment was effected by this issues so it went unnoticed.
after reading the thread it looks like the R10 and R7 requests have not been working
I found this in the email Erentpayment sent yesterday afternoon
"What if the bank doesn’t accept the letter?
Should tenants encounter any resistance while filing the R10 or asking about an R07 using the provided letter, please reach out to us with the below information so that we or NACHA can help to resolve the issue. contact please include the following information: tenant name, tenant amount, landlord name, tenant bank name, bank number, and name of person at bank the tenant was dealing with along with the Subject line of “Bank Contact” so we can try to filter those emails."
Not much help but I think if we all push forward we can work towards a resolution.
@Ryan Z. there is a FB group erentpayment discussions that talking with attorneys it is worth checking out; we just asked our tenant to submit the R10 to his bank yesterday so we hope that will work and go from there.
Wells Fargo denied my tenant's R10/R07 after sitting on it for 12 days.
They have since gone back with NACHA contact in hand for WF rep to talk to as to why they denied.
Hopefully this helps as there has been a mixed bag with a majority of WF claims being denied but some saying WF has returned the money.
I don't quite understand the push back from the banks as the money comes from Check Commerce/First Premier Bank...it doesn't come out of WF funds.
Ok, I'm out $10k... I'm shocked to read folks with bigger losses!!! I've been working with the tenants who where on this system to move to checks, money orders, bill pay, direct deposit to one of our many business accounts, their bank ACHing.
O-M-G !!!
Its a nightmare in this emergency switching folks over to something else. Tracking rent will be a hair pulling nightmare. Whos paying via which channel?
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The future will be some other processor but which/who? If I learned anything here its, bigger is better, large reserves (but how to verify), good Errors and Omissions insurance is a necessity. But how do I create a table of all the processors and choose based on lowest risk? Which per my comments above includes $$ flight time, where flight time being like a clay pigeon in a shooting range. IMHO shorter is better..
My plan A has said it will take till 1st qtr 2018 for them to roll out same day xfer... Darn! I have to choose someone now and move everyone back to a homogenious rent collection system ASAP.
FWIW I feel the best solution is rentals all clustered near the same bank branches and tenants walk in and make direct deposits. I have rentals all over GA and this doesn't work, plus tenants don't have time to walk into banks. They are begging me for a erent like solution!!!
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- I need a list of the B-I-G-E-S-T rent processors by transactions and by dollar volume?
- How do I ask for their insurance policy for such events?
- How do I ask them to show their disaster plan should an erent event happen?
- What is their cash flight time, min, typical and max?
- who owns the company if its owned by a larger co. What will they do in the case of a huge blow up and cash short fall?
- At this point you noticed I didn't even ask about fees. IMHO at $10k loss I've discovered that it doesn't mater what a service costs, its what it will cost you in the event of a failure. I care more about avoiding the loss then focusing on transaction fee comparison.
If a Cozy or similar can seize this once in a life time op and offer a service with a fee based guarrantee of no lost funds, I'd pay that fee and not even ask how much. I'm not in the least interested in free, I want zero losses,,, and a distant second fast xfer time!
IMHO Erent has foist a new litmus test on rent collection services:
- How will the providor prevent any lost funds?
- When (not if) there's a system failure how fast will I get the stuck funds?
- Do they have plan B (deep pockets / reserves)?
- Do they have effective insurance to cover losses even if there's fraud somewhere in the cash path? This a bigger issue than we all would have guesses in my view.
Answers to my questions? What have you done and why?
Update: I've gotten verbal confirmation from Wells Fargo that they will process the R10 return for our tenants. I had to call Wells Fargo headquarters and speak with an ACH specialist. They will tell you that the ACH department is internal only, and does not speak with customers, but be persistent. They are being very helpful now that I am speaking to the correct people. Good luck!
I just got an email stating that a reversal was completed - it was signed "Rick." So I am guessing he is starting to act like a normal business person. Mine was only $1300 in rent and tenant completed the reversal through a credit union a couple of days ago. If they had been transparent from the start, I would have stayed with the company. However, I'm done with them.
I apparently am VERY late in hearing about this! I saw an email from erentpayment on Oct 30th and was busy so I didn't read it. Today I got another one, so thought I'd take the time to read it and so what was going on. Well... Uggggg. I just finished disabling all our property accounts. I have zero confidence that tenants who are paying November's rent will actually make it to our bank account. I still can't believe this is happening!
FYI to all affected, get your tenant to dispute ASAP. The bankruptcy case it getting wild. Multiple companies are challenging the ability of the BK court to hold their funds in the range of the 100s of thousands of dollars - multiple merchants besides erentpaymnet. ECheckIT - the real "bad-guy" in this, has filed a motion to unfreeze almost 4MM in funds - stating that because erentpayments has posted on their FB page about reversing payments, they've lost $500k since then, money that supposedly they believe should remain part of the BK estate. A reply has been filed to counter that those funds aren't EcheckIT funds, but rather those of its clients. So the disputes are somewhat working, at least to the tune of at least half a million. BUT - be wary that there will be a hearing on 11/08/17 to possibly pull these funds out of EcheckIT's account and into a BK estate account, so you/your tenants need to act fast.
@Jerry Kisasonak - Being that your VERY late to the party on this one, Im also going to assume you had collected all your payments from last month (meaning you've got tenants that entered rent early, dont play with late or grace periods), and received all your payments outside the window of issue.
You're extremely lucky :)
That said, its been one heck of a ride with these guys. Communication from erent is horrible.... there was a recent posting in the Facebook page (erent discussion group) that broke down HOW the system works - its a fascinating read, much like "The creature from Jekyll Island", how the whole ACH system works and where it can fall apart. The post was a reply to the bankruptcy court from the bank that put a freeze on eCHECKits ability to initiate ACH transfers.
It does appear the eRENT has their back-end processes fixed as I received payment recently - albeit I still have ONE locked up in their system. While the explanation is plausible, Im MUCH more skeptical now and scrutinize our business partners WAY CLOSER.... and reading into the horrific English of eRENTS emails.... Im taking a pass on doing further business with them. Im willing to bet the company is a cloud-based couple of servers, and 2-3 people in a shared office suite. Looks like they were moving $4MM or so monthly, and that would generate a tidy little income around 10-12k monthly... not a bad gig for hosting a cloud app! At any rate, I just cant afford another crash like the last one.
Keep reading the threads, there are other services with varying levels of investment. For MY business its got to be rock-solid AND have the ability to enforce late fees, NO partial payments, reporting, and be friggin reliable! I also want to understand the ENTIRE back-end of whatever company we switch to.... shame on ME for not looking behind the curtain earlier.
FYI to all affected, get your tenant to dispute ASAP. The bankruptcy case it getting wild. Multiple companies are challenging the ability of the BK court to hold their funds in the range of the 100s of thousands of dollars - multiple merchants besides erentpaymnet. ECheckIT - the real "bad-guy" in this, has filed a motion to unfreeze almost 4MM in funds - stating that because erentpayments has posted on their FB page about reversing payments, they've lost $500k since then, money that supposedly they believe should remain part of the BK estate. A reply has been filed to counter that those funds aren't EcheckIT funds, but rather those of its clients. So the disputes are somewhat working, at least to the tune of at least half a million. BUT - be wary that there will be a hearing on 11/08/17 to possibly pull these funds out of EcheckIT's account and into a BK estate account, so you/your tenants need to act fast.
While this is true the motion has been filed...the R10 has no "limit" on it.
First Premier Bank (Check Commerce) takes on the liability for any R10 filed against them meaning that even if they had $0 of ERP funds they would still have to honor a properly filed R10.
So while the motion might help preserve funds for other business who have no recourse action such as the R10. The affected LLs /Tenants R10s have to be honored.
The worst thing about the R10 is that we're at the mercy of the tenants' perseverance (or lack thereof) in sticking with the process and making sure it goes through. The R10 and associated NACHA rules seem to leave no gray area. If the tenant disputes, they're due their money. But it seems to be quite a process sometimes. I offered each of my 2 tenants involved $200 if they could get the money back. Both have been successful. Once didn't accept the $200. The banks were Chase and Boeing Employees Credit Union.
@Curt McClements Your absolutely right it was a less than comfortable conversation with my tenant explaining that to no fault of there own I need them to go to the bank and dispute there last rent payment. When he asked what was in it for him, he was absolutely right so I extended a $100 credit.
According to their recent filing, CC Operations/EcheckIT has 6.3MM in debt, 5.5MM of which is for Erentpayment. They claim to hold 3.7MM in frozen "reserve" funds from ACH transactions. Their revenue was about $300k/yr over the past few years so they definitely can't weather the storm via their own profits - something to keep in mind if you chose a free service as your next ACH processor.
I do not think this is fraud. I know these systems very well and there are reserve requirements and banks have very little trust early on in any relationship. I have spoke with Rick Sands from erentpayment many times and believe he is a honest guy. These systems have a KYC requirement and all validations must be done for renters and landlords before funds are released. https://en.wikipedia.org/wiki/Know_your_customer -- Read some data here https://www.facebook.com/eRentPayment/