Tenant claims money was stolen. How would you respond?

Question

Tenant made an ACH payment for February rent. The ACH payment was rejected due to non-sufficient funds. Four days later, the tenant made another ACH payment. It was also rejected for non-sufficient funds. When I asked the Tenant to explain, he said "Someone took my identity and stole my money."

How would you handle this?

Nathan Gesner · Answer

I agree with both of you and said the exact same thing to the renter. Why did they try to pay a second time if they knew the money was stolen? Have they reported it to the police? To the bank?

If the tenant is telling the truth, they should be able to provide me with a letter from the bank or a police statement. So far, they haven't provided any documentation.

This story is common among tenants that get behind on rent.

Adam Martin · Answer

I would encourage the person to file a police report and report it to their bank.  In instances of identity theft they can usually get their money back and if I believed it was real would work with them on a plan to get it repaid.  That said your story is suspect if it got stolen the first time why did they try to resubmit and why are you just now hearing about it.  I think they are trying to pull you on a fast one.

Julie Hartman · Answer

Funny how these events seem to occur right around the first of the month. Weird.

Dennis Wayne · Answer

I’ve had this excuse used many times in fact it’s probably the most common one I’ve heard ! There is a 99.999% chance the tenant is full of dog feces .whenever I get a call ( miraculous coincidence it’s around the first every time!) saying their identity was stolen and their bank froze their account I always go over the same response ..

“ billy , we both know that’s a lie for two important reasons , one your broke ..and two your a loser so no one on earth would ever want your identity , basically billy no one would ever want to be you !”

Marc Winter · Answer

"My dog ate my homework!"  "The check is in the mail!"

Look at their bank statements and/or deposit receipts from the bank.  If they come up with any excuse for not being able to produce that proof, I'd bet a donut they are just plain lying.

The problem here is that our new president has extended the non-eviction moratorium until the end of June for non-payment.  A solution would be to go and inspect the unit and find something that is a lease violation.  Perhaps you could evict on that.

Julie Hartman · Answer

Exactly what @Adam Martin said, they need to file a police report and refund the account so rent can be pulled. If they can prove the money was stolen, we would waive late fees but otherwise they need to pay them.

Colleen F. · Answer

Young tenants sometimes need to be told to file the police report AND call the bank. If it is true the bank will close the account will often restore their money after they deal with the fraud department.. Small credit unions however may not.  Dont ever link a bank account to venmo they are not good with fraud. Difficult to correct.

That said if they sent Ach twice without fixing probably they are just bad at math...

Nathan Gesner · Answer

I can't even remember how many times a Tenant has used this excuse, but I can tell you how many times it's been true: one.

One of my tenants claimed she purchased a money order but then lost it. The money order was not filled out, so it was essentially free money to whomever found it. She filed a police report and the police tracked it down to . . . a neighbor in her apartment building! He admitted to cashing it and agreed to pay her back, $100 a month for seven months. The police couldn't do anything to force him to pay her back faster, so she had to accept it.

Jim S. · Answer

In any case they are still responsible to pay the rent. That does not let them off the hook.

Stephen Kehoe · Answer

Ask for a cashiers check? I have tenants who prioritize my rent over other bills and give me a cashiers checks so the other collectors will overdraw their account and not me.

Tenant claims money was stolen. How would you respond?

Most Popular Reply