Verifying Tenant Identification
Copyright 2014 by Virgo Publishing.
By: Jeffrey Greenberger
Posted on: 09/01/2002



 

When I first started writing columns for this magazine, terrorism issues were not on the list of topics I thought I'd be addressing. Unfortunately, since Sept. 11, security and protection of investments from terrorist activities has become a focal point of self-storage operations. This month I want to address several related, frequently asked questions.

1. What do I do about noncitizens who do not have a social security number if I want to run a credit check?

One of the most important security improvements you can make at your facility is to require official documents (licenses, passports or immigration cards) to verify the information on your lease/application and your tenant's identity.

Before March 2002, any person legally living in the United States, citizen or not, regardless of whether he was working, could obtain a social security number. After March, only U.S. citizens and legal immigrants with visas permitting them to work were entitled to obtain one. This left self-storage operators (and other business owners) looking for some way to confirm the legitimacy of a foreign customer's identity. Operators who had always used a social security number to confirm the identity or run a credit check of a tenant with foreign identification were left at a loss.

In response to this dilemma, the government introduced a new identification number for those not eligible for a social security number known as an individual tax-identification number (ITIN). These nine-digit numbers are issued by the Internal Revenue Service, not the Social Security Administration. They are similar to a social security number, but they all begin with the number "9." To get an ITIN, a person must present certain documentation to the IRS, including proof he is legitimately in the country on an unexpired visa, etc., along with certain forms of positive photo identification. Below is a copy of the letter an ITIN recipient would receive from the IRS with an ITIN card in the bottom right corner. This will give you an idea what to look for.

There are obviously pros and cons to an ITIN, especially as it pertains to confirming your prospective tenant's viability to rent space from you. The most obvious advantage is for a person to have received an ITIN, the IRS has done a lot of the legwork for you, confirming the legitimacy of the person's photo ID and status in the United States. On the other hand, if the prospective tenant presents you an ITIN card, it means although he is in the country legitimately, he is not eligible to work. This makes an operator wonder how or where this applicant is getting enough money to pay rent.

Credit checks can be run on ITINs, but do not be surprised if there isn't any credit information in an ITIN file. In any case where credit cannot be properly verified, a security deposit or multiple-month advance payment should be required, as long as it is done uniformly. ITINs help replace social security numbers and may give you some credit information. If not, they at least give you some comfort that your prospective tenant is in the country legitimately.

2. Can I require a tenant to provide some sort of photo identification?

Absolutely--as long as you require all tenants to do so. However, it is difficult to know, outside your own state, what a legitimate, non-tampered photo ID looks like. Some forgeries include subtle mistakes, such as which way the person is supposed to be facing in the picture.

3. How do I know if a photo ID is legitimate?

Over the last year, there has been a boom in the publishing of books that describe and provide pictures of each state's drivers license and identification card, as well as many national identification forms including passports, U.S. immigration cards, etc. There are also books showing forms of international identification. They can be purchased for a relatively modest price, normally under $50. The best place to get these books is through your credit-screening company or local law-enforcement agencies. You can also try the Driver's License Guide Co. at 800.227.8827 or www.idcheckingguide.com.

Local law-enforcement agencies keep these books in their offices. If you rarely receive foreign identification, it would seem appropriate to buy the state ID book, but simply make a photocopy of foreign IDs when you get them and check them against the book at your local police department. If a prospect does not have any photo ID, you can refuse to rent to him, but you must enforce the rule uniformly on all applicants. There really should be no one legally in this country who cannot obtain a state- or country-issued ID or immigration card with a photograph.

This is actually the most important rule I have learned through taking various terrorism seminars: Confirm that the information on the application or lease actually matches the information on the identification card. That is, if you are simply taking the social security number or ITIN written on the application as accurate, a person could give you any number and you would not know it. It is important to verify that the name on the social security or ITIN card matches the name of the person renting from you, and that the name of the person renting from you matches the photo ID you have been presented.

4. Should I run a credit check on all applicants?

This is obviously a business decision more than a security issue in most cases. Credit checks are inexpensive and easily obtained by having the right software. Depending on your volume, credit reports often cost around $2 and can be simply added to the administrative or application fee you charge a tenant; so you won't be out any money for processing the credit report.

ITINs are now also searchable in credit-reporting software; however, it is not unusual to have no information come back on an ITIN because the numbers are so new. Credit issuers are not yet accustomed to asking for ITINs to submit people's credit history to reporting agencies. If you decide to run credit reports, you must run them on all applicants, not just ones who appear suspicious or with foreign identification.

If you do run a credit report, you can subscribe to a service that checks for fraudulent use of social security numbers. For example, if a social security number was issued in Arkansas in 1941, and you have a 22-year-old prospect with the same number who lists his home as Ohio, the credit-reporting software is going to give you some sort of alert that the number is probably fraudulent. ITINs do not yet have this protection, but it is expected. Running a credit report helps you identify potential credit risks, but it may also alert you to someone trying to rent from you under false pretenses. If this happens, a call to the local police department or FBI is appropriate.

4. Should I consider running criminal-background checks on prospects before agreeing to lease to them?

There has been an explosion over the last year in the number of people using services to check criminal backgrounds. There are pros and cons to running a criminal-background check. The most important decisions you need to make before deciding to do this are:

1) What are you going to do with the information once you get it? That is, are you going to refuse to rent to anyone who has a felony conviction, misdemeanor conviction, drug conviction, etc.?

2) What scope of check are you going to run? If you are going to run criminal checks, you should consider using the type of report that encompasses as many databases as possible, including the Office of Foreign Asset Control, the FBI's Most Wanted List and Fugitive List, and the wanted lists of other federal agencies and state and local law enforcement.

Obviously, the closer your facility is to a government building, military base or American icon, the more likely you want to consider running a criminal-background as well as identity check on each prospect. To simply get a county criminal-background check from your local sheriff really misses the mark. First of all, it is unlikely a terrorist would be renting a space under his own name if he already had warrants out for him in the county. A county line can be as close as five seconds to 15 minutes away. A crime committed in another county is not going to show up on a local county criminal report.

Criminal reports are expensive and require a lot of thought. It is my understanding that none of the Sept. 11 terrorists had any significant criminal history in the United States that would have alerted anyone in advance of their behavior. According to the various Al Qaeda training manuals, terrorism is often funded through activities such as petty theft; but these manuals advise against committing the types of crimes that would give rise to lengthy jail convictions. With this in mind, criminal reports generally are not useful for this sort of screening.

Your best solution may be to require photo ID, check the source documents to verify the information given on the application matches the identification you have been given, require the prospect have a social security number or ITIN, and run that number through a general credit report with fraud alerts. If you decide you are in an area where there is a greater terror threat, use criminal checks that encompass as many databases as possible.

Jeffrey Greenberger practices with the law firm of Katz Greenberger & Norton LLP in Cincinnati, which primarily represents owners and operators of commercial real estate, including self-storage. Mr. Greenberger is licensed to practice in the states of Ohio and Kentucky, and is the legal counsel for the Ohio Self Storage Owners Society and the Kentucky Self Storage Association. He is a regular contributor to Inside Self-Storage magazine and the tradeshows it sponsors. For more information, Mr. Greenberger can be contacted at Katz Greenberger & Norton LLP, 105 E. Fourth St., Suite 400, Cincinnati, OH 45202, or by calling 513.721.5151.