More than a third of letting agents have faced attempted financial fraud in the past year, and AI-generated scams now rank as the biggest security threat to client money. Research by The Letting Partnership found 35% of agents experienced or identified an attempted fraud or scam connected to lettings activity in the last 12 months.
Letting Agent Today reported the survey on 19 October. It found 36% of agents are not completely confident their business could spot a fraudulent or suspicious client-money transaction before funds move, while 54% believe agents face greater exposure to fraud than three years ago. Only 8% think exposure has reduced.
Client money is the pressure point landlords should watch. Rent payments and deposits flow through agent accounts daily, and the survey shows criminals target exactly those flows: phishing and impersonation of landlords or tenants topped live cases at 26%, with suspicious third-party rent payments next at 21%. AI-generated fraud, impersonation and deepfake scams already featured in 18% of reported cases.
AI scams now top the threat list
Despite ranking third in encountered cases, AI-enabled fraud was named the biggest financial security threat facing the sector, selected by 29% of respondents. That puts it ahead of tenant and payment fraud on 27%. The result suggests agents expect synthetic identities, cloned voices and faked documents to outpace conventional scams as the tools spread.
For landlords, the risk is practical rather than theoretical. A convincing email purporting to come from a landlord can redirect rent to a criminal account, while a faked tenant reference can place a fraudster in a property. Agents who cannot verify instructions before transferring funds leave both client money and rental income exposed.
Phishing and fake rent payments lead live cases
Phishing and impersonation remain the most common route in, cited by more than a quarter of agents who encountered suspicious activity. Suspicious third-party rent payments, where rent arrives from an unexpected source, affected a fifth. Both patterns point to weak verification at the point money moves rather than sophisticated hacking.
Stronger defences exist but need consistent use. Call-back checks on a known number before acting on payment instructions, segregated client accounts with dual authorisation, and membership of a client money protection scheme all narrow the opening criminals exploit. Landlords rarely see these controls in action, which is why asking about them before instructing an agent counts.
This follows Landlord Knowledge’s October report on the Norfolk agent sentenced over a £48,858 fraud, which showed what happens when safeguards fail at agency level. Separate Karis data on cyber attacks on property firms rising 17% underlines that criminals view agents as a soft target. The survey comes from The Letting Partnership, which handles client accounting for letting agents across the UK.
What this means for landlords
- If you use an agent: ask how client money is verified before transfers, and confirm the account details for rent payments by phone on a known number.
- Watch for: unexpected requests to change bank details, pressure to act fast, and rent arriving from unfamiliar third parties.
- Bottom line: agents hold your money, so their fraud controls are your financial protection.
Editor’s view
More than a third of agents doubting their own fraud controls is a poor advert for the sector. Landlords should treat client-money protection as a selection question, not small print. Ask the awkward question before you hand over the keys, not after the money goes missing.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 20 October 2026
Sources: The Letting Partnership
Related reading: Norfolk court sentences agent over £48,858 fraud
