Monday, May 16, 2016

Sleazebag Accusations Finally Catch Up To Notorious NYC Bully Landlord; NY AG Belts Him w/ Contemporaneously-Filed Criminal Charges, Civil Lawsuit For Variety Of Allegations Related To Operation Of Over 140 Apartment Buildings

In New York City, the The New York Times reports:
  • For decades, Steven Croman was a successful landlord in New York City. His companies bought up more than 140 Manhattan apartment buildings, often filled with rent-regulated tenants. And then, methodically, he pushed them to leave, buying them out of their leases for relatively modest sums or, if that didn’t work, harassing them until they left, tenants said. He was a regular on “worst landlords” lists. His tenants even created a website against him.

    Mr. Croman’s business came to embody in many ways how rent regulations have eroded in the city, putting housing out of reach for more and more New Yorkers. He was able to deregulate most of his rent-stabilized apartments within just a few years of buying the buildings, enabling him to reap much higher rents.

    On Monday morning, though, his fortunes took a different turn. Mr. Croman, 49, turned himself in around 7 a.m. at the First Precinct in Lower Manhattan. He was charged with 20 felonies, including grand larceny, criminal tax fraud, falsifying business records and a scheme to defraud, relating to accusations he inflated his rental income to secure more than $45 million in bank loans. He faces up to 25 years in prison. His mortgage broker, Barry Swartz, 53, was charged with 15 felonies.

    The New York State attorney general’s office, which investigated Mr. Croman for almost two years, also sued Mr. Croman on Monday, seeking to force him to give up his real-estate business and pay millions of dollars in restitution to tenants and penalties.
    ***
    In its lawsuit, the attorney general’s office accused Mr. Croman of harassing and coercing “countless working-class and low-income families out of their longtime homes.” Mr. Croman then turned those vacant rent-regulated apartments into lucrative market-rate units, often with shoddy and illegal construction that violated lead-safety laws and endangered tenants who remained in the buildings, court documents said. Mr. Croman’s companies are also accused of repeatedly ignoring violations and orders issued by the city’s buildings and health departments.

    The lawsuit also named Mr. Croman’s director of security, Anthony Falconite, a former New York City police officer accused of abusing his former position, and accused him of intimidating tenants into surrendering their apartments.

    Mr. Croman is accused of using a variety of methods to push out rent-controlled tenants. He was said to offer them buyouts, often no more than a few thousand dollars or a few months of free rent. Employees of Mr. Croman referred to tenants as “targets” and competed to push out the most, the lawsuit said. A property manager who persuaded a tenant to take a buyout was said to have earned a bonus of up to $10,000.

    Mr. Croman would walk through his office chanting, “buyouts, buyouts,” the lawsuit said. At one point, Mr. Falconite told a property manager through a text message that obtaining buyouts was a “team sport.” The lawsuit said the property manager, Christine Bermudez, then responded: “I know that!! Who’s our next target? We have to start lining them up!!!”

    If tenants did not leave voluntarily, Mr. Croman had other tactics, the lawsuit said. He turned their buildings into hazardous construction sites, failed to make repairs and failed to maintain services such as heat, electricity and hot water. His companies also repeatedly filed baseless lawsuits against tenants. In internal emails, company employees acknowledged that such suits would “aggravate” tenants or pressure them to accept buyouts, the lawsuit said.

    In some cases, Mr. Croman’s employees refused to acknowledge receiving tenants’ rent checks, and then his companies sued the tenants for unpaid rent.

    In all this, Mr. Croman had one person he relied on more than any other: Mr. Falconite, whom he described as his “secret weapon.” The attorney general’s office accused Mr. Falconite of lying to get into tenants’ apartments, of posing as a repairman, a building manager, a U.P.S. deliveryman, an inspector. He would do “building sweeps,” knocking on the door of every rent-regulated unit in a building. Once inside, Mr. Falconite would accuse tenants of illegally occupying the units, demand their identification and take their photographs without permission, the lawsuit said. Then he would stalk them, it said, confronting them at work and even following them out of state. The goal: to intimidate them into leaving.

    During a subpoena hearing, Mr. Falconite admitted that he used his credentials as an ex-officer to see confidential complaint logs at a police precinct, according to court documents. He then used that information to threaten a disabled tenant whose partner had died six months earlier.
For the rest of the story, see Regular on New York’s ‘Worst Landlords’ Lists Is Charged.

For more on this lowlife, see Inside the mega-parties ‘Madoff of landlords’ threw in the Hamptons (Sources familiar with the Cromans could barely contain their glee at Steven’s arrest on charges filed by state Attorney General Eric Schneiderman. “They are super-obnoxious. They have no class,” one source said. “They are very lavish people. They are not low-key. They brought it upon themselves.”).

For the New York Attorney General press release, see A.G. Schneiderman Announces 20 Felony Charges And Civil Suit Against Major New York City Landlord Steven Croman (Croman, Owner Of 140 Apartment Buildings Throughout Manhattan, Faces 20 Felony Counts, Including Grand Larceny, Criminal Tax Fraud, And Falsifying Business Records; Mortgage Broker Barry Swartz Also Charged; Cases Allege Croman Pushed Rent-Stabilized Tenants From Their Apartments And Obtained Loans Based On False Accountings Of Rent-Stabilized Tenants In His Buildings).

Go here for the Spanish version of the press release.

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