FEMA Relocation Scam - Landlords/Property Managers Beware

FEMA Relocation Scam - Landlords/Property Managers Beware

Real Estate Professional · Tampa, FL · Member since 2015 · 176 posts · 252 votes

Tampa based property manager here. To say the past few months since the storms hit have been challenging would be an understatement. But something happened to my business in November that may be a larger issue for many of you who own or manage properties in Florida after the recent hurricanes. 

I currently manage 36 doors. The vast majority of my tenants (particularly the ones I placed and did not inherit) have been great. Always pay on time, take care of their units as if they were their own, etc. However, as you can imagine, I had a small percentage of my units that were problematic. Late rent payments, etc. 

During the month of November, 4 units, pretty much all my problem tenants, picked up in the middle of their lease terms and vacated after failing to pay November rent. They all did the same thing, telling me they were going to pay, biding their time, and then by the end of the month they were suddenly gone. 

Now, this struck me as strange because these people are constantly behind on their rent. How are they coming up with a security deposit and a months rent and moving costs for a new apartment? Well today, I got my answer. 

While showing one of the newly vacated units to a potential renter, he informed me that he was displaced because of the hurricanes, and that FEMA was providing him with assistance for moving, including paying his security deposit, rent, and moving costs. That's when it hit me.

I believe that even though none of the properties these tenants were living in took damage from the storms, they applied for FEMA assistance anyway. They walked away from their leases, took FEMA money to move (and maybe even replace some "damaged" possessions, and are now living in new housing on the taxpayers dime.

So first thing, when ever I have someone displaced coming using FEMA money to pay, I'll be doing a full background into where they were living before and contacting their previous landlords. I want to know that they actually lived in a property that was damaged.

Second, I am going to be speaking with a FEMA case manager tomorrow, and will be reporting my suspisions of fraud. I am currently in the process of filing lawsuits against all of these tenants on behalf of my clients, and I am hoping we can add criminal charges onto the civil suits. These lease breaks will cost me 100s of man hours trying to fill these vacancies, repairing damage left behind, and pursuing the civil cases. I intend to go after them for everything I can. (I have successfully won damages in every eviction I've handled so far, btw).

Just letting everyone on here know what I suspect to be going on, so you can be on the lookout for this activity from some of your current and future tenants.

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  • Michael SmytheBusiness Member
    Real Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
    1y

    Thanks for sharing!

    Went through all this with COVID rent funds, so feel your pain.

    Logical Property Management4.9453 Reviews
  • Doug SmithPro Member
    Lender · Tampa, FL · Member since 2013 · 2k+ posts · 2k+ votes
    1y

    Wow, Stephen! What an interesting post. Thanks so much for sharing. I had not thought of that, but it makes sense. I wish you well in solving the issue. 

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