Sunday, March 01, 2015

KKK Member Gets Ten Months For Perjury In Connection w/ Probe Into Racially Motivated Cross Burning In Alabama That Resulted In Conviction Of Two Others For Criminal Interference w/ Housing Rights Of Another

From the U.S. Department of Justice (Washington, D.C.):
  • [Last month], U.S. District Court Judge L. Scott Coogler sentenced Pamela Morris, former secretary of a chapter of the Ku Klux Klan (KKK) in Ozark, Alabama, to 10 months in prison and three years of supervised release for committing perjury during a grand jury’s investigation into a racially motivated cross-burning.

    Morris, 47, previously admitted during her plea hearing on June 12, 2014, that she lied to a federal grand jury investigating a cross-burning committed by Steven Joshua Dinkle, Morris’s son and the Exalted Cyclops (president) of the local KKK, and Thomas Smith, another KKK member. On May 8, 2009, Dinkle and Smith burned a six-foot tall cross at the entrance to an African American neighborhood in Ozark to threaten and intimidate residents.

    Several witnesses observed and were frightened by the cross, including a young man returning from choir practice as the defendants set the cross ablaze. In sworn testimony before the grand jury, Morris made several false statements, including denying that she had been the secretary of the Klan or involved with the KKK at all.

    In pleading guilty, Morris admitted that she had been an officer of the KKK and that her testimony denying any connection to the organization was false. She further acknowledged that she knew Dinkle had committed the cross-burning. In addition, Morris admitted that she testified falsely to prevent the grand jury from learning about other KKK members who had information relevant to the investigation.

    Dinkle is currently serving a 24-month sentence imposed on May 15, 2014, for his conviction on hate-crime and obstruction-of-justice charges related to the cross-burning.(1)  Smith, Dinkle’s co-conspirator, was sentenced to five years of probation on Aug. 19, 2014.
For more, see Former Ku Klux Klan Officer Sentenced to 10 Months for Committing Perjury During Cross-Burning Investigation.

Go here for links to other cross burning incidents from the U.S. Justice Department.

(1) Former Alabama KKK Leader Sentenced to Prison for Cross Burning and Obstruction of Justice:
  • Dinkle pleaded guilty to hate crime and obstruction of justice charges related to the cross burning. Specifically, he pleaded guilty to one count of conspiracy to violate housing rights, one count of criminal interference with the right to fair housing and two counts of obstruction of justice.


    Dinkle admitted that in burning the cross, he intended to scare and intimidate residents of the African-American community by threatening the use of force against them. He further admitted that he burned the cross because of the victims’ race and color and because they were occupying homes in that area.

Saturday, February 28, 2015

Ex-Klansman Gets Nine Months On Charges Involving Interference w/ Housing Rights Of Another; Admitted To Role In Cross Burning Incident In Front Of Interracial Family's Home

From the Office of the U.S. Attorney (Washington, D.C.):
  • [Earlier this month,] Timothy Flanagan, 33, was sentenced to nine months and ordered to pay a $5000 fine in federal court in Nashville, Tennessee, for his role in the April 30, 2012, cross burning in front of an interracial family’s home in Minor Hill, Tennessee, the Department of Justice announced. Flanagan previously pleaded guilty to one count of conspiring with others to threaten, intimidate and interfere with an African-American man’s enjoyment of his housing rights, and one count of interfering with those housing rights.

    Flanagan—a former member of the Church of the National Knights, a Ku Klux Klan affiliate—admitted during the plea hearing that on the night of April 30, 2012, he and two other individuals devised a plan to burn a cross in the yard of an African American man in Minor Hill, Tennessee. Flanagan’s co-conspirator, Timothy Stafford, constructed a wooden cross in a workshop behind his house.

    Using Flanagan’s credit card, Stafford and co-conspirator Ivan “Rusty” London then purchased diesel-fuel with which to soak the cross. Flanagan and the other co-conspirators then drove the cross to the victim’s residence and, upon arriving at the residence, Flanagan and London exited the truck. The cross was placed in the driveway leading up to the house and was ignited. The co-conspirators burned the cross with the purpose of intimidating the African-American male who resided at that residence.

    Timothy Stafford, 41, of Minor Hill, Tennessee, and Ivan “Rusty” London IV, 21, of Lexington, Kentucky, previously pleaded guilty for their roles in the conspiracy, and will be sentenced on March 3, and March 26, respectively.
For more, see Former Klansman Sentenced for Cross Burning.

Go here for links to other cross burning incidents from the U.S. Justice Department.

Friday, February 27, 2015

Unit Owners In Failed Florida Condo Complexes Get Squeezed Out Of Their Homes As Developers Acquiring 80% Interest In Defunct Projects File For "Condominium Termination", Then Give Unit Owners The Boot

In Winter Springs, Florida, the Orlando Sentinel reports:
  • Shirley Lofgren, 85, is being forced to sell the sun-filled, waterfront condo she and her husband bought nine years ago for less than a third of the $217,000 they paid for it.

    The sale is allowed under a "condominium termination" law passed by the Legislature in 2007.

    "Nobody can believe this is legal — that they can just take your home and they'll give you what they want to give you," said the former Chicago resident, whose husband now lives in a nearby Alzheimer's treatment center.

    Rep. Chris Sprowls, R-Clearwater, said Lofgren and condo owners across Florida are being "divested" of their own homes.

    Under the law, developers must get an appraisal to determine the value of a home. But Sprowls said owners are left with little negotiating leverage.

    "In this situation, these people are not being permitted to stay in their homes, and that's just wrong," said Sprowls, who has proposed a reform bill that would pay relocation fees and above-market value for condo owners who live in their units.

    The law, passed in order to reinvigorate stalled condo projects, lets developers take title to condos when only 20 percent of the units are in the hands of individual owners.

    Throughout the state since the law was passed, developers and investors have used the condo-termination law to take ownership of more than 11,000 condominiums in 160 condo complexes, according to records from the state Department of Business and Professional Regulation. In Central Florida, Enders Place at Baldwin Park, Conway Forest, Esplanade Condos, Harbor Beach, Summerlin at Winter Park and Harbor Bay Retirement Village are among the condominium projects that have gone through a wholesale change of ownership.

    Many condo complexes had been apartments before converting to condominiums during the real-estate boom of a decade ago. Now they are reverting back to apartments as rental demand grows.

    Outside the sliding-glass doors of Lofgren's home, the green lawn is trimmed. The developer, Prestwick Partners LLC, has painted apartment buildings cheery shades of yellows and blues to entice renters as it urges Lofgren and other remaining condo owners to sell.

    Representing Prestwick Partners LLC, Miami lawyer Michael Cosculluela contacted Lofgren's family last week urging it to accept the offer to sell her unit to Prestwick. In an email, Cosculluela told them that the company is "under considerable pressure from the lender to simply file suit for ejectment [eviction]," and that if Lofgren seeks a higher price through the courts and then fails, "it will result in far less money for her unit after attorney's fees and costs."

    April Woods, whose company owns a unit in the same complex, said Prestwick is attempting to acquire ownership of the units by amending the condo documents. She said she has contested it in Seminole County courts.

    In Metro Orlando, the value of condos suffered during the economic downturn, dropping by more than half after the housing-market collapse. For the price Prestwick is offering, which is covered by a confidentiality agreement, Lofgren said she can find no similar condos anywhere, let alone near the Publix, SunTrust and restaurants she can now walk to. She said she has started looking at a mobile-home park off University Boulevard.

    The developer Prestwick Partners LLC has offered Lofgren the chance to rent her home from it at a reduced rate.

    At her condo, Lofgren walks onto her patio and fills a water bowl for a stray cat that has wandered up. She said she loves her place, which was bought mostly with cash, and would prefer to stay. She still has to pay off a $20,000 mortgage that paid for travertine tile, custom molding, granite counters and fireplace upgrades.

    The octogenarian said she isn't certain that she would she have enough money left from the sale of her condo to rent it back for the remainder of her days.

    Up until 2007, all the owners in a condominium project had to agree to terminate their ownership. In 2007, legislators changed the laws so that only 80 percent of owners had to agree to end their ownership.

    The law became the "Distressed Condominium Relief Act" in 2010, and it helped restore Florida's bottomed-out condominium market by encouraging lenders and developers to take over the condo projects with "fractured" ownership, said Fort Lauderdale attorney Mark Grant, who helped author that legislation.

    "That worked very well. Bulk buyers came in droves," Grant said.

    Condo complexes had been so empty that the few remaining holdout owners were saddled with association fees, maintenance costs and taxes, he added.

    Grant said some of the provisions in Sprowls' proposed bill are "poison pills" that could limit investors' appetite to reclaim challenged condo complexes. They would be more likely to encounter financial obstacles from trying to buy out remaining owners.

    Grant said he is working with Sen. George Moraitis, R-Fort Lauderdale, on a compromise measure. Among other things, developers would have more opportunities to terminate ownership if condo owners initially rejected the idea.

    Sprowls said that without laws in place to protect owner occupants of condos, buyers such as Lofgren are likely to shy from buying condos, and Florida's condominium market could soften.

Thursday, February 26, 2015

Antitrust Feds Squeeze Guilty Pleas From Pair Accused Of Sherman Act Violations Involving Bid Rigging At Northern Georgia Foreclosure Sale Auctions

From the U.S. Department of Justice (Washington, D.C.):
  • Two Georgia real estate investors pleaded guilty [] for their roles in a conspiracy to rig bids and commit mail fraud at public real estate foreclosure auctions in Georgia, the Department of Justice announced.

    Separate felony charges were filed against Mohammad Adeel Yoonas and Kevin Shin on Dec. 23, 2014, in the U.S. District Court for the Northern District of Georgia in Atlanta. According to court documents, from at least as early as April 2008 until at least March 2012, Yoonas conspired with others not to bid against one another, but instead designated a winning bidder to obtain selected properties at public real estate foreclosure auctions in Gwinnett County, Georgia. Yoonas was also charged with a conspiracy to use the mail to carry out a scheme to fraudulently acquire titles to selected Gwinnett County properties sold at public auctions, to make and receive payoffs and to divert money to co-conspirators that would have gone to mortgage holders, homeowners and others by holding second, private auctions open only to members of the conspiracy. The department said that the selected properties were then awarded to the conspirators who submitted the highest bids in the second, private auctions.

    Shin, according to court documents, conspired with others not to bid against one another, but instead designated a winning bidder to obtain selected properties at public real estate foreclosure auctions in Gwinnett County from at least as early as March 2009 until at least March 2012. Shin was also charged with a conspiracy to use the mail to carry out a scheme to fraudulently acquire title to selected Gwinnett County properties sold at public auctions, to make and receive payoffs and to divert money to co-conspirators that would have gone to mortgage holders, homeowners and others by holding second, private auctions open only to members of the conspiracy. The department said that the selected properties were then awarded to the conspirators who submitted the highest bids in the second, private auctions.

    “These six guilty pleas result from the Antitrust Division’s ongoing investigation into schemes to rig public real estate foreclosure auctions in Georgia,” said Assistant Attorney General Bill Baer for the Department of Justice’s Antitrust Division. “The division will continue working with its law enforcement partners to expose cartels that harm distressed homeowners and lenders.”

    The department said that the primary purpose of the conspiracies was to suppress and restrain competition and to conceal payoffs in order to obtain selected real estate offered at Gwinnett County public foreclosure auctions at non-competitive prices. When real estate properties are sold at these auctions, the proceeds are used to pay off the mortgage, and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner. According to court documents, these conspirators paid and received money that otherwise would have gone to pay off the mortgage and other holders of debt secured by the properties, and, in some cases, the defaulting homeowner.

    The criminal actions of the defendants in this case provide a clear example of why enforcement of the Sherman Act remains necessary in maintaining a level and competitive field within commerce,” said Special Agent in Charge J. Britt Johnson for the FBI Atlanta Field Office. “The FBI will continue to work with the U.S. Department of Justice’s Antitrust Division in identifying such financial schemes that attempt to take unfair advantage, to include those targeting the foreclosure auction process.”

    A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine for a Sherman Act charge may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime if either amount is greater than the statutory maximum fine. A count of conspiracy to commit mail fraud carries a maximum penalty of 20 years in prison and a fine in an amount equal to the greatest of $250,000, twice the gross gain the conspirators derived from the crime or twice the gross loss caused to the victims of the crime by the conspirators.(1)

    The investigation is being conducted by Antitrust Division’s Washington Criminal II Section and the FBI’s Atlanta Division, with the assistance of the Atlanta Field Office of the Housing and Urban Development Office of Inspector General and the U.S. Attorney’s Office for the Northern District of Georgia. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions in Georgia should contact Washington Criminal II Section of the Antitrust Division at 202-598-4000, call the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258, or visit
For more, see Georgia Real Estate Investors Plead Guilty to Bid Rigging and Fraud at Public Foreclosure Auctions.

Go here for earlier posts on foreclosure sale bid rigging rackets.

(1) As has been pointed out here in earlier posts, suspects who have been pinched on bid-rigging charges and are considering copping guilty pleas should first consider whether their alleged unlawful bid rigging racket was really nothing more than an innocent, lawful joint bidding endeavor. See Illegal Bid Rigging Racket? Or Mere Innocent 'Joint Bidding' Arrangement?

Wednesday, February 25, 2015

Purported "Sovereign Citizen" Gets Three Years In Connection With Income Tax Prosecutions & Subsequent Filing Of Bogus Retaliatory Liens Against Two Federal Judges, Nebraska U.S. Attorney, Other Feds

From the U.S. Department of Justice (Washington, D.C.):
  • A La Vista, Nebraska, woman was sentenced [] in U.S. District Court for the District of Nebraska in Omaha to serve 36 months in prison and three years of supervised release for tax obstruction, filing a false claim and filing false retaliatory property liens, Principal Deputy Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division announced.

    Donna Marie Kozak, a former college instructor, was convicted by a jury on Aug. 1, 2014, on all nine counts charged in the superseding indictment. At trial, the evidence showed that in 1997, Kozak stopped filing income tax returns, and from 1997 through 2012, she obstructed the Internal Revenue Service (IRS) by hiding assets, applying for tax-exempt status for a sham entity, filing a false claim for a tax refund, sending harassing correspondence to IRS agents, and filing false liens against an IRS-Criminal Investigation special agent and others.

    In about 2009, Kozak joined the “Republic for the united States of America,” a sovereign citizen group, and was the group’s designated “governor of Nebraska.” In 2012 and 2013, Kozak and Georgia resident Randall Due conspired to file false liens in retaliation for the federal criminal tax prosecution and trial convictions of associates David and Bernita Kleensang. In furtherance of the conspiracy, Kozak and Due filed a false lien for $19 million on property located in Boyd County, Nebraska, that was owned by the federal U.S. District Court judge who presided over the Kleensang trial.

    After Kozak was indicted by a federal grand jury for the criminal tax charges and while on pre-trial release, she filed five more false liens on properties owned by another federal U.S. District Court judge, the U.S. Attorney for the District of Nebraska, two Assistant U.S. Attorneys and an IRS-Criminal Investigation special agent. Due was tried and convicted in the District of Nebraska on related charges on Sept. 4, 2014.
Source: Nebraska “Sovereign Citizen” Sentenced for Obstructing Internal Revenue Service and Filing False Property Liens Against Federal Officials.

Click links for earlier posts on attempts by so-called sovereign citizens to file phony deeds and bogus retaliatory liens to either hijack title to or otherwise cloud the title to real estate.

Tuesday, February 24, 2015

Homeowner: I Lost Part Of My NY/Connecticut Border-Straddling Home When Next-Door Neighbor Snatched Up .2 Acre Portion Out From Under Me At R/E Tax Foreclosure Sale For $275, Then Demanded $150K For Its Return; Mortgage Servicing Bankster Seeks Negotiated Buy-Out From Tax Deed Holder

In New Fairfield, Connecticut (or neighboring Brewster, New York, depending on what side of the house you're in), The Stamford Advocate reports:
  • Plans to build a shed on her half-acre property led Rosanne Di Giulio to a shocking discovery.

    She learned her neighbor owned 0.2 of an acre of her property, including most of her house and front yard.

    "I thought I was going to be sick to my stomach," Di Giulio said Thursday. "I cried hysterically. Then I got a hold of myself."

    Di Giulio's property straddles Putnam and Fairfield counties, with 0.2 of an acre lying in Brewster, N.Y. Putnam County conducted a delinquent tax auction in 2010 that led her neighbor, Althea Jacob, to purchase the 0.2-acre parcel for $275.

    On the heels of her 2013 discovery, Di Giulio, 52, petitioned the court to get her property back. After 17 months of legal wrangling, a solution may be near.

    The banks that held her mortgage -- the same financial institutions she thought had been paying the taxes -- are negotiating a deal to pay the neighbor for the Brewster parcel. In return, as a third-party recipient, Di Giulio would get her property back, according to her attorney, Michael Caruso, of Carmel, N.Y.

    Caruso said they will be in court next Friday. Di Giulio is asking to have the "clock turned back" on her Putnam County property taxes, he said.

    "This is all subject to a ruling on reasonableness," Caruso said. "Did the county act properly and did the county communicate properly with another county in another state about what was happening?"

    Michael B. Karlsson II, of Wm. G. Sayegh, P.C., is representing Jacob and said his client saw a sign posted on a tree on the Brewster parcel. The sign was a notification about the tax auction and Jacob acted to "protect her home," he said.

    "You don't know who is going to buy a parcel," Karlsson said. "She did what anyone would do and bought it. Who would have known that half of Ms. Di Giulio's house was included with the parcel?"

    Di Giulio claims Putnam County never notified her about the delinquent Brewster taxes.

    She refinanced her mortgage in 2004 and again in 2006, entering an agreement with the banks, American Homes Servicing and Chase Mortgage Services, to pay into an escrow account that was supposed to finance the Putnam County taxes, Di Giulio said.

    Di Giulio filed a petition in September 2013 to overturn the foreclosure, citing lack of notice and breach of contract by the lenders.

    New York Superior Court Judge Victor Grossman last March denied Di Giulio's petition to invalidate Jacob's deed and he ordered the Putnam County finance commissioner to provide proof that a foreclosure notice was sent to Di Giulio. The judge dismissed the liability claims against the lenders.

    Calls to Putnam County Deputy Attorney Andrew Negro were not returned.

    Tax records indicate vacant land for the 0.2-acre parcel at 46 Hudson Drive in Brewster, N.Y. The records for the 0.3-acre portion of the property at 62 Hudson Drive in New Fairfield indicate improved property and tax the house.

    Karlsson said this is not unusual when a property straddles two states. It is an agreement often reached between the states.

    "My client had no animosity toward Ms. Di Giulio," Karlsson said. "She's done nothing wrong."

    However, Di Giulio believes Jacob had hard feelings toward her prior to buying the Brewster parcel.

    Di Giulio pointed to an earlier disagreement when Jacob encroached on her property. Di Giulio said she reacted by installing a chain-link fence down the middle of Jacob's driveway to properly mark the property line.

    "She'd widened the gravel driveway over the years, encroaching on my property when the previous owners had it," Di Giulio said.

    New Fairfield property records show a $5,107.02 tax lien on Di Giulio's property filed last September by the state of Connecticut.

    Di Giulio said Thursday she had difficulty paying bills after she was laid off from a previous job. The state tax lien on the New Fairfield parcel will be paid with her 2014 income tax refund expected this spring, she said.

    Di Giulio is a former employee of The News-Times, a sister paper of The Advocate.
Source: Tax auction spurs turf war between neighbors (Tax auction pits neighbor against neighbor).

See also, New York Post: Woman loses half of her border-straddling home in tax snafu:
  • Rosanne Di Guilio’s kitchen, living room and porch now belong to her neighbor Alethea Jacob, 52, who snatched up .2 acres of the half-acre plot for $275 at a county auction after it went into foreclosure in 2010.

    “It’s sickening. She’s an opportunist. How do you sleep when you do something like this?” said Di Guilio, a 52-year-old electrical contractor who lives in Brewster, NY, or New Fairfield, Conn., depending on which side of the house she’s on.

    Rosanne Di Guilio’s survey blueprints show the the dividing line between Patternson, New York and New Fairfield, Connecticut.

    Di Guilio, who is fighting the foreclosure in court, said Jacob demanded $150,000 when she tried to buy back the house after she learned of the tax snafu in 2013.

    She insists Jacob schemed for access to her property to avoid fixing her own leaky septic tank. “I believe she bought it to be able to use [my] septic. It would be thousands of dollars to fix her own,” fumed Di Guilio, who has owned the home since 1997.


    Chase will take responsibility for the cost Di Guilio will have to pay to buy back the property, she said. Jacob and the bank are still negotiating a price.

Sunday, February 15, 2015

Another Crackpot Asserting 'Sovereign Citizen Privileges' Gets Pinched For Filing Phony Deed In Attempt To Hijack Title To $4.7M St. Louis-Area Mansion Mistakenly Believed To Be Unoccupied/Abandoned; Suspect Clipped For Only Two Misdemeanors As Cops Apparently Pass On Filing Felony Charges (At Least For Now)

In Chesterfield, Missouri, KTVI-TV Channel 2 reports:
  • Police say a woman going by the name “Queen” tried to file false paperwork to take possession of a $4.7 million home last summer. Lakresha Slaughter, 28, filed a claim with the St. Louis County recorder of deeds for the Chesterfield home on July 3rd.

    The couple who own the home put it on the market and took it off. They were still living in the mansion when “Queen” put a sovereign claim on the home. Police say Slaughter thought the home was unoccupied or abandoned. So, she went with her husband going by the name “Rehan Keyaan Alui Bey” to file a claim with the Recorder of Deeds.

    A letter was sent telling owners telling them to vacate the property and turn over the keys within 10 days. Slaughter claimed she owned the property.

    The actual owners contacted authorities to get to the bottom of the letter. Police say “sovereign claims” happen more than you would think.

    Slaughter goes by the name “Queen Makieah Ali Bay.” Police say she considers herself a Moorish American National and part of the sovereign citizens movement. An increasing number people claiming to follow Moorish Science have filed false legal documents like fake liens, deeds, and property claims. Many sovereign citizens say they are answerable only to their interpretation of the law.

    Lakresha Slaughter told investigators that her father told her to,”Look into taking back the land that is rightfully hers,” according to the probable cause statement. She claims her father introduced her to a man who told them to change their names and file the documents to take possession of the property. The man told her that after 10 days the County Sheriff would give them the keys to the unoccupied home.

    Now, Lakresha Slaughter is charged with two misdemeanors for filing false documents.

    The $4.7 million mansion is no longer for sale.
Source: Woman tries to kick owners out of $4.7 million Chesterfield mansion.

Click links for earlier posts on attempts by so-called sovereign citizens to file phony deeds and bogus retaliatory liens to either hijack title to or otherwise cloud the title to real estate.

Friday, February 13, 2015

Wall Street Banksters Now Getting Into Running Rent-To-Own Rackets?

ProPublica reports:
  • At a conference on housing finance last month, a collection of investors described their innovative "rent-to-own" products.

    Rent-to-own schemes have long exploited the poor. Naturally, marketers address that problem with euphemisms. Today, it's called lease purchase. The arrangements work in myriad permutations, but the basic deal is that a person rents a home and pays for an option to buy it at a later date.

    All the panelists hailed the product, calling it a "yield enhancer" that would increase profits. In a standard lease, one panelist explained, the owner covers costs like taxes, maintenance cost and insurance. With lease purchase, the renter pays those expenses. And it's easier to evict because the occupant has only a rental agreement. It's not a foreclosure proceeding against an owner, after all.

    One went further. Eli Shaashua, of Red Granite Capital Partners, described it this way: "Basically, it's an added fee to the rent. For us, it instills pride in homeownership for some tenants who cannot currently when they rent a house own their own home."

    Having pride in ownership means that the renter takes care of the property more carefully. So that's a good thing — for the owner, that is.

    Shaashua went on to explain that his options last generally for two years. A renter pays a bit extra for the right to buy the house at a predetermined price, one above the current value.

    Then Shaashua delivered the kicker to the roomful of would-be investment managers: "Most times, given the reality, tenants do take it, but it's hard for them to execute the option," he said. "Our experience is that most stay until the end and then they say they cannot come up with the down payment or decide not to stay in the property."

    Voila, free money. This amounts to an admission that the product exploits consumers' lack of financial savvy. This shouldn't be surprising. Who are you going to bet gets the price right, an aspiring home buyer or analyst with access to oceans of data on prices and historic trends?
For more, see Rent to Own: Wall Street’s Latest Housing Trick.

For another somewhat critical view of rent-to-own deals, see Minnesota Public Radio: Rent-to-own homebuying on the rise, and so are problems.

Go here for earlier posts on rent-to-own rackets, lease purchase scams and other real estate ripoffs disguised as legitimate sale transactions involving delayed or deferred title closings used in a variety of ways to screw wanna-be homeowners.

Wednesday, January 28, 2015

U.S. Department Of Justice Tells State, Local Cops To Keep Hands Off Asset Seizures Under Federal Forfeiture Laws Unless Accompanied By Warrants Or Criminal Charges; Loopholes Remain As Use Of Police Power To Pull Off Unwarranted Property Ripoffs Still Possible If Feds Participate In Joint Seizures; State Law Seizures Also OK

In Washington, D.C., The Washington Post reports (via Public Citizen's Consumer Law & Policy Blog):
  • Attorney General Eric H. Holder Jr. on Friday barred local and state police from using federal law to seize cash, cars and other property without warrants or criminal charges.

    Holder’s action represents the most sweeping check on police power to confiscate personal property since the seizures began three decades ago as part of the war on drugs.

    Since 2008, thousands of local and state police agencies have made more than 55,000 seizures of cash and property worth $3 billion under a civil asset forfeiture program at the Justice Department called Equitable Sharing.

    The program has enabled local and state police to make seizures and then have them “adopted” by federal agencies, which share in the proceeds. It allowed police departments and drug task forces to keep up to 80 percent of the proceeds of adopted seizures, with the rest going to federal agencies.

    “With this new policy, effective immediately, the Justice Department is taking an important step to prohibit federal agency adoptions of state and local seizures, except for public safety reasons,” Holder said in a statement.

    Holder’s decision allows limited exceptions, including illegal firearms, ammunition, explosives and property associated with child pornography, a small fraction of the total.(1) This would eliminate virtually all cash and vehicle seizures made by local and state police from the program.

    While police can continue to make seizures under their own state laws, Equitable Sharing was easy to use and required most of the proceeds from the seizures to go to local and state police agencies. Some states have higher standards of proof for forfeitures and some require seized proceeds to go into the general fund.
For more, see Holder limits seized-asset sharing process that split billions with local, state police.

For U.S. Department of Justice press release, see Attorney General Prohibits Federal Agency Adoptions of Assets Seized by State and Local Law Enforcement Agencies Except Where Needed to Protect Public Safety:
  • The new policy applies only to adoptions, not to seizures resulting from joint operations involving both federal and state authorities, or to seizures pursuant to warrants issued by federal courts. The policy does not limit the ability of state and local agencies to pursue the forfeiture of assets pursuant to their respective state laws.
Go here for earlier posts on the abuse of asset forfeiture laws to seize property, cash.

(1) See Hit & Run Blog: The Fine Print in Holder's New Forfeiture Policy Leaves Room for Continued Abuses (An exception for joint task forces allows evasion of state property protections).

Wednesday, January 14, 2015

U.S. Supremes: Filing A Lawsuit Not Necessary To Rescind Consumer Loan Under Truth In Lending Act; Simply Notifying Creditor In Accordance With Regulations Is Sufficient

From Public Citizen's Consumer Law & Policy Blog:
  • Resolving a split among the federal courts of appeals in favor of consumers, the Supreme Court held today in Jesinoski v. Countrywide Home Loans, Inc., that a consumer may exercise the right to rescind a loan under the federal Truth in Lending Act simply by notifying the creditor rather than (as the creditor contended and as several federal courts had held) by filing a lawsuit.

    The unanimous opinion by Justice Scalia relied on the plain language of the statute, which provides that a borrower “shall have the right to rescind . . . by notifying the creditor, in accordance with regulations of the Board, of his intention to do so.” Obviously, it's much easier to provide notice than to file a lawsuit, so this is a clear win for consumers (an increasingly rare event at the Supreme Court these days).

Tuesday, January 06, 2015

Bay State Real Estate Operator Gets Canned For Ten Months, Faces Ten Years Probation & $112K Restitution Order For Ripping Off Nearly 100 Wanna-Be Homeowners In Blatant Rent-To-Own Racket Targeting 1st Time Buyers, Consumers w/ Crappy Credit

From the Office of the Massachusetts Attorney General:
  • An Easton man has pleaded guilty and been sentenced to jail in connection with stealing $112,000 from customers in a “Rent to Own” advance-fee scheme, Attorney General Martha Coakley’s Office announced []. He was also ordered to make full restitution to his victims.

    Joshua Leventhal, age 44, of Easton, pleaded guilty today in Bristol Superior Court to the charges of Larceny over $250 (4 counts) and Larceny by a Single Scheme.

    “This defendant tricked consumers into believing his program would result in easy homeownership, when in fact, not one of his nearly 100 customers was ever able to purchase a home through that program,” said AG Coakley. “He will now serve time in jail for his crimes and will be required to pay full restitution to the victims.”

    After the plea was entered, Superior Court Judge Robert J. Kane sentenced Leventhal to two years in the House of Correction, with 10 months to serve and the balance suspended for 10 years, during which time he will be on probation. Judge Kane also ordered Leventhal to pay restitution in the full amount of $112,000. Leventhal will begin serving his sentence on Feb. 17, 2015.

    Several victims were present in court today and provided impact statements about the effect of Leventhal’s actions.

    The AG’s Office began an investigation in the fall of 2012 after the matter was referred by the Bristol District Attorney’s Office and the Easton Police Department. The investigation revealed that Leventhal operated a “Rent to Own” scheme out of his Easton home, ultimately stealing over $100,000 from customers between 2010 and 2011.

    Leventhal described his “Rent to Own” program as a way for first-time home buyers or people with poor credit to rent a property through a complicated agreement with the homeowner, which allowed the buyer to later purchase the property for a set price and for a portion of each monthly check to be set aside for the renter to use as a deposit for that purchase. Investigation revealed that not one of Leventhal’s customers ever purchased a property under his program.

    Leventhal targeted first-time homebuyers and consumers with poor credit through online advertisements. Leventhal posted thousands of online advertisements including deceptive claims, such as: “Our rent2own program WILL turn you into a homeowner ASAP,” and “Rent 2 Own WILL Turn You Into A Homeowner Even If You Have Bad Credit and/or No Down Payment.”

    Leventhal, on a now-shuttered website, also fabricated customer testimonials, including one in which a customer purportedly wrote, “I saved $44,000 on my Rent 2 Own Purchase. All I can say is WOW.”

    In reality, investigators learned that out of Leventhal’s nearly one hundred customers, only three customers ended up occupying a property through his program, and not one of his customers ever purchased a property through his program.

    According to investigators, after he convinced potential customers that his program was a functional and successful path to homeownership, Leventhal charged them an enrollment fee, typically ranging from $150 to $2,000.

    In some cases, Leventhal also received additional deposit money from his customers, ranging from $4,350 to $7,000. However, Leventhal did not use these funds to pursue homeownership for his customers, but rather kept the money for his own personal use.

    A Statewide Grand Jury returned indictments against Leventhal on August 15, 2013 and he was later arraigned in Bristol Superior Court. He pleaded guilty and was sentenced [] in Bristol Superior Court. He will begin serving his sentence on Feb. 17, 2015.

    The case was prosecuted by Assistant Attorney General Andrew Doherty of AG Coakley’s Fraud and Financial Crimes Division, with assistance from Investigator Marco DePalma, Victim Advocate Megan Murphy, and Sergeant Jack Lynn of the Easton Police Department.(1)
Source: Easton Man Pleads Guilty, Sentenced to Jail in Connection with Stealing More Than $100,000 in "Rent to Own" Scheme (Sentenced to Jail, Ordered to Pay Restitution to Victims in Full Amount of $112,000).

See Would-Be Homeowner Victimized In Rent-To-Own Racket: "If Somebody Says, 'We Finance Homes; Ugly Credit, No Credit,' Don't Buy It! Do Your Research. I Didn't, & I Got Stung!" for an earlier story of a Pennsylvania consumer who got similarly screwed on a rent-to-own ripoff.

Go here for earlier posts on "rent-to-own" rackets.

(1) As a reminder to those who mistakenly believe that these apparent ripoff deals are nothing more than civil cases (as opposed to criminal matters), it is clear that all the sophisticated paperwork in the world (ie. business/purchase contracts, leases, closing statements, etc.) isn't enough to permit scammers to insulate themselves from criminal prosecution when they target their victims with scams masquerading as legitimate-looking business propositions when screwing them over. Criminal prosecutors have the authority to "pierce through" such attempts to disguise a blatant criminal real estate ripoff as a normal, arms-length business transaction.

Clear precedent exists for such a "pierce through" approach to overcome any objections that will certainly arise when the scammers make the argument that the arrangement was just a civil transaction that, if challenged, should be done with a civil lawsuit, not a criminal prosecution. See, for example:
  • People v. Frankfort, (1952) 114 Cal.App.2d 680, 700; 251 P.2d 401:

    Defendants insist these contracts insulate them from this prosecution because they contain the statement that they constitute the entire agreement between the parties, that the Spa Corporation is not bound by any representations outside the contract, that no salesman is authorized to make any additional or contrary representations, and that the club member has read and understands what he is signing. The simple answer to this argument is that "The People prosecuting for a crime committed in relation to a contract are not parties to the contract and are not bound by it. They are at liberty in such a prosecution to show the true nature of the transaction." (
    People v. Chait, 69 Cal.App.2d 503, 519 [159 P.2d 445]; People v. McEntyre, 32 Cal.App.2d Supp. 752, 760 [84 P.2d 560]; People v. Jones, 61 Cal.App.2d 608, 620 [143 P.2d 726]; People v. Pierce, supra, p. 605.)
  • People v. Jones, (1943) 61 Cal.App.2d 608, 620 [143 P.2d 726]:.
    Defendant argues that the deal with each "seller" was a
    civil transaction; [...] Cloaked in the draperies of his corporation and pretending to act in its behalf, he boldly approached his unsuspecting victims.

    Although each deal in its incipiency
    bore the color and trappings of a normal, civil contract, yet when subjected to a postmortem it exhaled the stench and disclosed the carcass of a fraud. (People v. Epstein, 118 Cal.App. 7, 10 [4 P.2d 555].) There appears no sign of good faith at any turn. Each taking and appropriation was a grand theft.
    The use of the corporate name and the promises made in accomplishing his purpose
    were a camouflage of such common variety that no excess of genius was required to discern the fraud. Parol evidence of all that occurred was admissible to show the intention of defendant. (People v. Robinson, 107 Cal.App. 211, 221 [290 P. 470].)

Wednesday, December 31, 2014

Another Snoozing Bankster Sleeps Through Foreclosure Statute Of Limitations; Court Denies Foreclosure On $1M+ Penthouse, But Also Refuses To Cancel Note & Mortgage, Will Not Quiet Title In Favor Of Property Owner

In Miami, Florida, the Daily Business Review reports:
  • Deutsche Bank snoozed and lost on a foreclosure suit that took about seven years to play out in Miami-Dade.

    While the bank's case wound its way through the court system, Aqua Master Association Inc. started its own foreclosure claim to enforce liens and collect unpaid dues for a penthouse at 201 Aqua Ave. in Miami Beach.

    The condo association gained ownership of the penthouse in 2011, and successfully argued in court that Deutsche Bank waited too long to pursue the case.

    The Third District Court of Appeal agreed, siding with the condominium association and barring the bank from continuing the foreclosure.

    The case shows the "negative consequences that lenders can face if they go too far with their delay tactics in foreclosure cases," condo association attorneys Nicholas and Steven Siegfried said in a statement.

    The case was Deutsche Bank Trust Co. Americas v. Harry Beauvais, a borrower who defaulted on his mortgage within months of securing it in early 2006.

    Loan servicer American Home Mortgage Servicing Inc. filed suit in January 2007, demanding accelerated payments for the full $1.44 million.

    Ironically it was this move for upfront payments that would unravel the lender's case and cost the bank the million-dollar property, because the condo association successfully argued the demand started a five-year clock for resolving the foreclosure.

    Statute of Limitations

    The court booted American Home Mortgage's case without prejudice when the servicer failed to attend a hearing.

    That dismissal led the condo group to start its own efforts to claim outstanding fees on the penthouse.

    "Like a lot of associations, this one was waiting to see what would happen with the foreclosure action," said Nick Siegfried, shareholder at Siegfried, Rivera, Hyman, Lerner, De La Torre, Mars & Sobel in Coral Gables. "But since the bank didn't proceed and the case was dismissed, the association had no choice but to proceed on its own."

    Aqua Master Association won control of the penthouse in 2011, but its claim remained subject to the mortgage.

    When Deutsche Bank took over American Home's foreclosure suit in December 2012, Aqua said the clock had already been ticking for five years and was about 11 months outside the statute window.

    The bank argued the earlier dismissal "decelerated" the loan, but a judicial panel disagreed.

    In an opinion issued Dec. 17, judges Frank Shepherd, Kevin Emas and Edwin Scales barred Deutsche Bank from pursuing the foreclosure. They found the bank never withdrew the original demand for accelerated payments, and so had to abide within the five-year window.

    Mortgage Still in Play

    But it was a case of good news and bad news for the Aqua condo association, because while the Third DCA blocked the lender from pursing the foreclosure, the court did not wipe out the mortgage. It means Aqua can continue to rent the penthouse, but can't sell it without approval from Deutsche Bank, whose mortgage lien is valid until 2041.

    Siegfried said the group is considering an appeal to challenge the lien.

    Deutsche Bank attorneys William McCaughan, Steven Weinstein and Stephanie Moot of K&L Gates in Miami did not respond to requests for comment by deadline.

    "Even though the bank can't enforce the mortgage, it has the ability to prevent a sale from going through," Siegfried said. "The association would have to deal with them on some level and perhaps negotiate a payoff with them, otherwise hold off the sale of the property."
Source: Statute of Limitations Dooms Deutsche Bank in Foreclosure.

For the court ruling, see Deutsche Bank Trust Company Americas v. Beauvais, Case No. 3D14-575 (Fla. 3d DCA, December 17, 2014).

Wednesday, December 24, 2014

Court Rejects Sneaky Bank's Scheme To Improperly Circumvent Judicial Foreclosure By Requiring Escrowed Contingent Deed, To Be Recorded Upon Future Default, As Condition To Grant Homeowner Forbearance Agreement

A recent court ruling by a U.S. Bankruptcy Court in Rockford, Illinois (In re Primes, 9/26/14) illustrates how the doctrine of equitable mortgage applies in the context of a transaction involving a financially distressed homeowner facing the loss of her home, and the lender currently holding the mortgage and threatening foreclosure.

More specifically, and given the particular facts of this case, it illustrates how a bank requiring the defaulting homeowner to sign over a deed to be held in escrow in connection with obtaining a forbearance agreement will be prevented from taking possession of the premises upon a subsequent default by the homeowner without first bringing a foreclosure action. In such a case, the bank is prohibited from obtaining possession of the premises by simply recording the escrowed deed and booting the homeowner through a forcible detainer (eviction) action. Such a scheme was looked at by the court as nothing more than the bank's attempt to improperly extinguish the homeowner's equitable right of redemption to evade judicial foreclosure.

An oversimplified summary of the fact follows (the reader is referred to the court's opinion for a full recitation of all the minutiae):
  1. After the homeowner defaulted on her payments on her home mortgage, the bank commenced a foreclosure proceeding.
  2. The homeowner filed for Chapter 13 bankruptcy to halt the foreclosure action, and subsequent thereto, reached a forbearance agreement with the bank that called for regular monthly payments and a balloon payment.
  3. In addition, the bank required the homeowner to sign over a quit claim deed (which purported on its face to be in lieu of foreclosure) to the bank as security for homeowner's performance of her obligations pursuant to the forbearance agreement.
  4. The bank agreed to hold the deed in escrow, but that in the event of homeowner's default, the bank was authorized to record the deed and take possession of the home.
  5. As part of the agreement, the bank dismissed the ongoing foreclosure action.
  6. After approximately two years of monthly payments on the forbearance agreement (and shortly after the bankruptcy case was closed and the Chapter 13 trustee was discharged), the homeowner defaulted again.
  7. The bank sent notice to the homeowner that if the payment default was not timely cured, it would record the deed held in escrow.The homeowner failed to cure; the bank then recorded the deed.
  8. The homeowner then filed a second Chapter 13 case, (a) proposing to make up the back payments to reinstate the forbearance agreement, and (b) claiming that she was still the owner of the home, despite the deed she signed over to the bank a couple of years earlier.
The court described the legal issue to be addressed as follows ("Alpine" is Alpine Bank & Trust Co., the mortgage lender, Mrs. Primes is the Debtor/homeowner):
  • Alpine argues that the pre-petition recording of the quit claim deed transferred ownership in the Mila Ave. property to the bank. Alpine thus contends that as of the petition date the Debtor had no interest in her residence and no right to redeem the property, and, therefore, the property is not necessary for her reorganization. See, e.g., Colon v. Option One Mortgage Corp., 319 F.3d 912 (7th Cir. 2003) (automatic stay may be lifted because at the time debtor filed her plan under Chapter 13 she "had no right to redeem").

    Ms. Primes argues in response that under Illinois law the quit claim deed given in connection with the Forbearance Agreement must be treated as an equitable mortgage, that the bank's recording of the deed without judicial foreclosure is ineffective to transfer her ownership interest, and that she is entitled to cure her default and satisfy the bank's secured claim through her Chapter 13 plan.

    Under the facts presented, the court finds the Debtor's argument to be correct under Illinois law.
As the basis for its conclusion, the court goes through an extensive analysis of the Illinois law (refer to the court's opinion for its full analysis of the law), and its application of the law to the facts of the case. Interesting to note that, while the underlying principles are the same, the case law reviewed by the court was a different line of cases than the line of cases often cited when the equitable mortgage doctrine is invoked in Illinois in the context of a sale leaseback foreclosure rescue scheme (compare the line of cases cited in In re Primes with the line of cases cited in Hatchett v. W2X, Inc., 993 NE 2d 944 (Ill. App., 1st Dist., 1st Div. 2013), a sale leaseback foreclosure rescue case).

After its analysis of the applicable Illinois law, the court reached its conclusion, making these findings and observations:
  • The doctrine of equitable mortgage applies not only to purported transfers executed at the time money is lent, but also to deeds executed after the time the debt is created such as in the context of an amendment, a refinancing, a forbearance agreement or other work-out situation.


    Applying the principles discussed above to the facts in this case, it is clear that the execution, delivery and recording of the Debtor's quit claim deed was ineffective to transfer title in her Rockford, Illinois property from Ms. Primes to Alpine Bank. Instead, the Debtor still owned the Mila Ave. property as of the petition date. Alpine Bank holds only a secured claim which could be modified through a plan pursuant to and in accordance with Chapter 13 of the Bankruptcy Code.

    The evidence establishes that the parties did not intend for the quit claim deed to immediately transfer title to the Mila Ave. property from the Debtor to Alpine Bank on July 13, 2011. The Forbearance Agreement provided that the deed would be held in escrow and not recorded until after a future default in the Debtor's payment obligations. Additionally, at least for some period after July 13, 2011, the Debtor continued to make and Alpine Bank continued to accept payments. Alpine instead simply held the deed for the contingency of a later default. The bank's officer admitted at trial that it was not his bank's understanding that it was receiving the property at the time the Debtor deliver the deed; rather the instrument was security to secure the loan. Therefore, the deed here is not a deed in lieu of foreclosure as contemplated by 735 ILCS 5/15-1401.

    Further, it is clear from the language of the Forbearance Agreement and the bank's actions that Alpine Bank did not intend that the recording of the quit claim deed would extinguish or satisfy the debt owed by the Debtor to the bank. The Agreement expressly states that the "recording of the Deed will not extinguish the debt of Borrower to Bank." The Agreement also provides that the debt would not be reduced until the further step of a sale of the property to a third party. The Agreement states that "[u]pon the sale of the Property, Bank shall provide a credit to Borrower against the indebtedness which is due at that time" and that any "deficiency which remains after the sale of the Property shall be due and payable in full to Bank from Borrower." Again, as the bank's officer admitted, the quit claim deed was security for its loan that it only recorded after the Debtor missed several payment installments.

    Alpine cannot have it both ways. As stated in Sutphen v. Cushman, the bank cannot argue that it holds the property absolutely and at the same time retain the right to enforce payment of the full debt. 35 Ill. 186 (Ill. 1864). At most, the parties intended to agree upon a mechanism that they believed would allow Alpine Bank to obtain title to the property upon a future default without the need for judicial foreclosure and without requiring future cooperation of the Debtor. But as stated by the Illinois Supreme Court in Bearss, parties cannot "by mere agreement . . . even by express stipulation" agree in advance to "cut off the right of redemption" in such a manner. 108 Ill.16.

    Even were this court able — which it is not — to set aside Bearss and the well-established law of Illinois and, as Alpine now proposes, adopt the approach taken by the courts in Ringling Joint Venture II and Guam Hakubotan, Inc., it does not appear that result here would change. In marked contrast with those decisions, the instant case involves an individual debtor's residential property in a consumer transaction with an unsophisticated borrower. There is no evidence that the Forbearance Agreement was drafted at the insistence of the Debtor or that she signed it in bad faith. Indeed the Debtor testified without dispute that she intended to make payments under the agreement at the time she signed it, that she did initially make payments and only fell behind after she broke her wrist and was out of work for several months.

    Accordingly, the Debtor held title to the property as of the date of the petition.
For the court ruling, see In re Primes, Bankr. No. 13-B-83310 (Bankr. N.D. Ill., Western Div. September 26, 2014).

Sunday, December 21, 2014

Fair Housing Feds Squeeze Major NYC Developer For Up To $2M To Settle Allegations That Design & Construction Of Newly-Built Rental Housing Failed To Comply w/ Accessibility Requirements; Lawsuit Triggered By Non-Profit Civil Rights Advocate's Undercover Testing Probe

In New York City, the Fair Housing Justice Center recently announced:
  • On December 10, 2014, Preet Bharara, the United States Attorney for the Southern District of New York, announced the settlement of a lawsuit filed earlier this year against a major New York City real estate developer for failing to design and construct rental housing in compliance with the accessibility requirements of the federal Fair Housing Act.

    The defendants entering into the settlement include Related Companies, L.P., and its subsidiaries and affiliates, Upper East Lease Associates, LLC and Tribeca Green, LLC. The settlement ensures that current and future residential development projects, including the Hudson Yards development on Manhattan’s west side, will comply with federal accessibility requirements.

    The consent order, signed by federal Judge Shira A. Sheindlin, details retrofits that will be made at four residential rental complexes in Manhattan to make them more accessible including, One Carnegie Hill, Tribeca Green, 500 West 30th Street, and 529 West 29th Street. In addition, twelve other apartment complexes will be inspected under the order to determine whether additional retrofits are required in these developments. If residents are temporarily displaced due to modifications of occupied apartments, the order requires defendants pay them for food and lodging at federal government per diem rates.

    All totaled, 4,500 units of rental housing are impacted by the order. In addition, the defendants agree to provide training on fair housing design and construction requirements for their employees and agents and take other steps that will ensure future compliance with fair housing laws.

    Finally, the order establishes a settlement fund to compensate aggrieved persons who have been harmed by the discriminatory practices and lack of accessible features at the affected properties. The defendants are required to pay up to $1.9 million in settlement funds for victims, in addition to paying a civil penalty of $100,000.

    In 2006, the Fair Housing Justice Center (FHJC) completed an undercover testing investigation that was aimed at learning whether architects and developers of new multifamily rental housing in Manhattan were complying with federal accessibility requirements. FHJC’s investigation found that all of the new developments tested were not in compliance with federal requirements. The FHJC turned over the results of its investigation to the US Attorney’s Office (SDNY). Since the FHJC investigation was completed, the U.S. Attorney’s Office has filed nine lawsuits alleging fair housing accessibility violations and, as of the filing of this order last week, obtained settlements in eight of these cases. A ninth lawsuit involving the Durst Organization is still pending.

    FHJC Executive Director Fred Freiberg praised the U.S. Attorney’s office for vigorously enforcing the accessibility provisions of the federal Fair Housing Act and protecting the rights of persons with disabilities. Freiberg stated, “The outcome achieved by the parties to this litigation will expand housing opportunities for persons with disabilities in New York City.” Freiberg added, “It also sends a potent message to architects, developers, and builders of multifamily housing. If you take steps to ensure that new multifamily housing is designed and constructed in an accessible manner, you can avoid the significant costs associated with protracted litigation, damages, and retrofits.”

    Aggrieved individuals who may be entitled to monetary compensation from the settlement fund in this case include persons who were injured by the lack of accessible features at One Carnegie Hill, Tribeca Green, or other properties constructed by the Related Companies. This includes persons who were:

    1) discouraged from living at one of these properties because of the lack of accessible features;
    2) injured by the lack of accessible features at one of these properties;
    3) prevented from having visitors because of the lack of accessible features at one of these properties;
    4) required to pay to make apartments accessible at one of these properties; or
    5) discriminated against on the basis of disability as a result of the design and construction of one of these properties.

    Persons who may be entitled to compensation should file a claim by contacting the U.S. Attorney’s Office Civil Rights Complaint line at (212) 637-0840 or by using a Civil Rights Complaint Form available at
Source: Settlement Aimed at Making Rental Housing Accessible to Persons with Disabilities (Order Covers 4,500 apartments; Defendants Pay Up to $2 Million to Resolve Lawsuit).

Saturday, December 20, 2014

Owner/Operators Of Downstate NY Senior Living Residences & Assisted Living Facility Agree To Cough Up $297K+ To Settle Alleged Fair Housing Act Violations

From the Fair Housing Justice Center:
  • On December 11, 2014, federal Magistrate Ronald L. Ellis signed an agreement to settle a lawsuit filed by the Fair Housing Justice Center (FHJC) against the owners and operators of four senior living residences located in Staten Island, Manhattan, Westchester County, and Rockland County as well as one assisted living/adult home facility in Rockland County. The federal complaint, filed in May 2013, alleged various discriminatory policies and practices based on disability, religion, and race.

    The allegations in the complaint included, among other things, maintaining a separate dining room for wheelchair users at one site, a prohibition on the use of power wheelchairs at another site, intrusive medical inquiries, questions about the religious practices of potential applicants, as well as the use of only white human models in marketing materials. The complaint was based on a four-month testing investigation conducted by the FHJC in 2012.


    While the defendants denied any wrongdoing, the settlement requires, among other things, that the defendants comply with fair housing laws; adopt policies to prevent future discrimination; obtain fair housing training; prominently market themselves as an equal housing opportunity provider; and pay $297,500 in damages, attorney fees, and costs. Most provisions of the agreement continue for a period of four years. During this time the defendants will maintain certain records and make them available for inspection by the FHJC. These provisions are designed to ensure future compliance with fair housing laws.
Source: Settlement Ensures Non-Discrimination in Senior Living Residences and Adult Home Facility (Defendants Pay $297,500 to Resolve Fair Housing Lawsuit).