PBSA warned about fake bookings from international websites

In a startling revelation, the student accommodation sector is facing a new wave of challenges with the emergence of high-tech, large-scale fake bookings.

Operators in Purpose-Built Student Accommodation (PBSA) are grappling with an intricate web of fake student details and aggressive sales tactics that have left them dealing with unprecedented late cancellations.

The Intricacies of the Scam

The method employed this year is more sophisticated than ever. A bot program generates emails on a massive scale across various providers like Hotmail, Outlook, and 163. These emails funnel back to a central source, managing responses, but crucially, many are left unanswered.

Simultaneously, bots from diverse locations scour PBSA operator websites and booking engines. Some operators find themselves dealing with bookings made using these bot-created emails and fabricated student details.

Moreover, there's an increasing number of non-bot bookings using fake emails, with a notable concentration from China, although the situation is far from straightforward.

Motives Behind the Scam

Understanding the motives behind this elaborate scam is essential. The culprits could fall into several categories:

1. Marketplaces Reserving Availability: Some suspect marketplaces are reserving availability with fake students, anticipating a later switch to real students when the property is sold out.
2. Individuals or Marketplaces Engaging in Profit Gouging: There's speculation that individuals or marketplaces are booking rooms to later resell at a premium through social media, particularly when rooms become scarce.
3. False Promises to Students: For manual bookings, students may be lured into booking through marketplaces with promises of unlimited cancellations for any reason at any time.

Identifying the responsible parties remains a work in progress. Possibilities include:

1. Marketplaces in China
2. Marketplaces in India
3. Individuals or Criminal Gangs Engaging in Price Gouging
4. Students Hedging Bets on Accommodation (In Addition to Bots)

Safeguarding Against the Scam

Operators are urged to take proactive measures to protect themselves against this surge in fraudulent activity:

• Add Captcha: Introduce a captcha on websites and booking engines to deter automated bots.
• Ban IP Addresses: Consider blocking IP addresses of scrapers or bots, particularly from China and India.
• Reintroduce Deposits: Reinstate deposits and adjust amounts as necessary to minimize speculative bookings.
• ID Verification: Require all bookings to provide passports for thorough identity verification.
• Marketplace Training: Educate marketplaces to avoid aggressive sales tactics and discourage 'spray and pray' approaches.

Belt and Braces Approach:

• Guarantors: Make it mandatory for all students to have a UK guarantor.
• Instalments: Bring forward instalment payment dates to ensure commitment.
• Payment Source Verification: Cross-verify payment sources to ensure they match the student's details.
• University Approval: Check for an approval letter from the university before confirming any bookings.

In the face of this evolving threat, the PBSA sector must collaborate, adapt, and fortify its defences to protect both operators and students from the disruptive impact of fake bookings.

We have created this article by summarising the work of Daniel Smith, of the Student Housing Consultancy.