Probably referring to covert subletting where there is a renter re-renting it for a higher price. We used to do something similar when i lived in NYC. we divided up the rooms and got a bunch of roommates that brought our rent way down or even let us live free. Like turning the living room into another bedroom, etc. One guy collects the money from everybody like an agent and pays the landlord. The roommates don't know what the true rent is, only care about what they agreed to pay with the agent who listed the room.
A more common problem would be owners who have someone else, like an agent or friend, manage their property. The agent acts as the owner on the lease. Payments go into the agents bank.
If there is a dispute between the true owner and the agent, like for example, the money does not get transfered, or there is a problem in their relationship, the renter suffers because their deposit is not returned or they have to move.