PART 3: PREVENTING FAKE PAY STUBS

In previous articles, we discussed fake pay stubs being presented by applicants and how to detect them.  Here we will discuss how to be proactive so you are not duped with fake pay stubs. 

The most pervasive stub fraud we’ve detected to date wasn’t an individual.

During a recent multi-site affordable housing file audit we uncovered a systemic issue with pay stubs.  At first glance the stubs didn’t raise any eyebrows, the format of the stubs was just unique. However, we noticed the same, unique format for several different employers in several different files.  They were small employers that were part of the same industry.  Ends up, the same “accountant” had produced fake stubs for them.  It was not clear if the employer or employees initiated this.  Nonetheless, these communities had to deal with multiple resident files with falsified income documents.  It was a lengthy, expensive process to address.       

As affordable housing providers, we need to ensure income documents are legit, so here are some steps you can take to prevent fake pay stubs:

Do routine file audits.

We all know we should do routine property file audits.  As you are reviewing files, make a mental note of the pay stub formats from one file to the next.  Our team has already added this to our on-site audit file review checklist.

  • Notable pay stub format from one applicant/resident to the next?
  • Notable pay stub format from one file to the next?
  • Notable pay stubs format from one certification to the next?
  • Are pay stubs from a common employer different or the same? 

Use a checklist.  We do.

We recommend you look for, identify, and address fake stubs as you are processing your file for approval.  Here are some checklist items that could help: 

    • Compare stub to stub within a certification
    • Compare stubs from one certification to the next (move in certification to recertification, for example)
      • Same employer, different stubs?
      • Different employer, same stubs?
    • Compare stubs from employers in one application or file to the next
  • Request URL or on-line pay stub download documentation from the applicant/resident.
  • Call the employer to verify.

When in doubt, pull your compliance support department in as a partner for a second look.  Do a little research on-line.  If things are not adding up, you may want to request additional information.  No matter what, be consistent holding all applicants to the same criteria.

Stay tuned for our next article where we will take an in depth look at what to do if you discover you’ve already fallen victim.

Have you encountered fake pay stubs?  Can you share how you handled it?

keep on complying with quality   -kg