Dear Patty - Drop Box Crime
Friday, May 24, 2013
I’ve recently become very alarmed about criminal activity regarding drop boxes. What do you recommend I do?
--Shaking In My Boots
Drop boxes have become big targets of criminals in Central Florida. What is believed to be organized crime is epidemic among apartment complexes, and now these criminals are turning to real estate offices that offer the option of rent collection through use of a drop box.
Caught On Tape: Thieves ransack Las Vegas property management company drop box
These criminals are not afraid of cameras or deep drop boxes with buckets in well-lit locations. They tend to determine which day of the month your box is likely to contain the most payments, then fish out payments using tools such as a thin hose attached to a vacuum or a long string with a sticky substance on the end.
The criminals use acetone to remove the ink describing "payable to” from money orders and checks, then cash the payments before you can get your tenant to stop payment. They also take advantage of tenants who leave the "payable to” blank so that the real estate office can just stamp in its name; doing so is like dropping cash into the box.
Law enforcement recommends eliminating the use of drop boxes altogether (you are not required to provide one). If you do use a drop box, protect yourself by informing tenants that they use the drop box at their own risk. In addition, let them know that they should never leave a payment with the "payable to” blank. Finally, warn tenants that the drop box may be removed at any time, without notice.
If a tenant chooses to use the United State Postal Service to deliver their rent payment to the landlord, the tenant is completely responsible for the replacement of that payment until the landlord acknowledges receiving the payment. In the same manner, the tenant should be completely responsible for the replacement of that payment when using the courtesy drop box until the landlord acknowledges receiving the payment.
The burden and choice of method of delivery should always be with the tenant. The reason many tenants do not use online bill paying is because not everyone is credit worthy or wanting of a bank account. Consequently, they purchase money orders each month and pay their rent. Many of the businesses that sell (or give) money orders now have options for landlords to have accounts for collecting rent at their location. This is an option you might want to consider, as it eliminates the need to accept payments at your office. The businesses that give free money orders (like check advance stores) will require the landlord to pay for each payment received. The businesses that sell money orders (like in a convenience store) will charge the tenant at point of payment in the store a few dollars to collect the rent payment on behalf of the owner. These payments are then electronically transferred to the landlord.
I hope you consider reviewing your rent collection process and determine what you might do if yourdrop box is the next target of criminal activity.
"Patty the Property Manager” appears courtesy of the ORRA Property Management Subcommittee. Readers are invited to submit property management related questions to Patty by sending an e-mail to firstname.lastname@example.org.
The ORRA Property Management Subcommittee provides this property-management advice column as a service to ORRA members. The column is intended to provide a general understanding, not as a substitute for individual legal consultation. The column should not be relied upon in specific situations without consulting a real estate attorney.