Having the right tenants in your property should bring peace of mind and a steady income. But when fraudulent tenants slip through the net, the consequences can be financially devastating and legally complex. In our latest insight, Zoe Turner, Landlord and Tenant Consultant Solicitor at Woodstock Legal Services, explains the growing risks of tenant fraud, how these scams operate, and why thorough tenant referencing remains your strongest protection.

Understanding the Risk of Fraudulent Tenants

In the letting world, most tenancies progress smoothly. But when fraud creeps in, it can cause financial loss, property damage, and lengthy legal disputes. Over time, patterns have emerged in the way fraudulent tenants operate. These scams are often well-planned, exploiting both legal loopholes and the natural trust landlords extend to new tenants.

Strong, thorough referencing is not just recommended; it is essential to safeguard against these risks.

Case Study: The Cannabis Farm Scam

In one striking case, a seemingly straightforward tenant applied for a property, presenting herself as a vulnerable woman needing stable accommodation. She paid six months’ rent up front in cash, a move that appeared reassuring at the time.

However, shortly after the tenancy began, communication stopped. The tenant became unreachable, refused inspections, and eventually, when access was forced, it was clear the property had been converted into a cannabis farm. The tenant had never lived there. The damage was extensive, the legal process was long, and the landlord was left to manage the fallout of a well-organised scam.

A critical red flag in this case was the large lump sum payment at the start of the tenancy. While many landlords welcome upfront rent, especially in uncertain economic climates, in cases of fraud, this tactic is often used to bypass scrutiny. It creates a false sense of security and can lead landlords to skip or rush the referencing process.

Why Large Upfront Payments Can Be a Warning Sign

It may seem counterintuitive, but a tenant offering to pay six or twelve months’ rent in advance is not always a positive sign.

A genuine tenant might do this if they lack a UK credit history, are relocating from abroad, or are between jobs. They will usually be open about their reasons and still welcome thorough checks.

A fraudulent tenant, on the other hand, often uses this tactic to take control of the process. The money is presented as a gesture of good faith, but in reality, it’s a distraction; buying silence, delaying suspicion, and discouraging deeper questioning.

Case Study: The Unlicensed HMO Sublet

Another troubling case involved a landlord renting a central London flat to a Chinese student. The letting agent checked the tenant’s passport, student visa, and university enrolment documents, all of which appeared genuine.

However, no formal referencing was carried out. Important steps, such as verifying a UK-based guarantor, checking proof of address history, or requesting recent bank statements, were missed. Once again, a large lump sum payment was made upfront, covering 12 months’ rent.

The tenant repeatedly delayed inspections, claiming to still live there. When access was eventually gained, it was revealed she had never lived in the property. Instead, she had sublet it to several other Chinese students. The flat had been converted into an unlicensed HMO (House in Multiple Occupation).



Shockingly, the new occupants believed their tenancies were legitimate. They had signed agreements naming the original tenant as their landlord and listing a well-known law firm, whilst completely unaware that the law firm’s identity had been falsely used.

The landlord was left in a legal bind, technically operating an unlicensed HMO, facing potential penalties, and responsible for evicting innocent subtenants who had themselves been defrauded.

The Common Thread in Rental Fraud

Although these cases differ in execution, they share key similarities:

• Fraudulent tenants appear legitimate.
• They rely on landlords being rushed, overwhelmed, or trusting.
• They use authentic-looking documents and plausible stories.
• They make quick, large payments to bypass scrutiny.

Once inside the property, they act as they wish, knowing it can be time-consuming and expensive for landlords to regain control.

How to Strengthen Your Tenant Referencing Process

A strong referencing process can significantly reduce the risk of fraud. Some essential steps include:

1. Verify Identity and Documents

Check ID against official documents and cross-reference with utility bills and bank statements. Use tools to detect forged documents.

2. Confirm Employment and Income

Contact employers directly using publicly available contact details – not those provided by the tenant. Confirm salary, position, and employment contract terms.

3. Use the Land Registry

Verify that landlord references are genuine by checking ownership details on the Land Registry.

4. Meet Tenants in Person

When possible, arrange a face-to-face meeting to discuss their reasons for moving, long-term plans, and how these align with their paperwork.

5. Review Bank Statements

Request recent statements to confirm affordability and look for unusual transactions.

6. Use Professional Referencing Agencies

Opt for providers that include credit checks, fraud screening, and identity verification.

7. Reference Guarantors Thoroughly

If a guarantor is used, apply the same referencing standards to them. 

Why Taking Your Time Matters

Fraudulent tenants often push for speed. If something feels wrong, slow the process down. It’s better to spend an extra week investigating than to spend months, or even years, dealing with the consequences.

Final Thoughts

Fraud is evolving. It can be subtle, strategic, and hidden behind convincing paperwork. However, with thorough checks, the right questions, and a willingness to dig deeper, landlords and letting agents can uncover the truth before signing a tenancy agreement.

Specialist Advice for Landlords and Tenants from Woodstock Legal Services

If you are a landlord or tenant facing issues with rental fraud, unlicensed subletting, or tenant disputes, our experienced landlord and tenant solicitors can help.

Speak to Zoe Turner in Woodstock’s award-winning Landlord and Tenant Team for tailored legal advice. Email z.turner@woodstocklegalservices.co.uk or complete the form below for a confidential consultation.