Saturday, June 25, 2016

Convicted, Foreclosure Scamming Attorney Gets Bagged Again For Alleged Unpunished Theft Of $1.8 Million From Her Escrow Account Occurring Prior To Earlier Conviction

In Suffolk County, New York, the Riverhead News-Review reports:
  • A disbarred Wading River attorney previously convicted in a $4 million real estate Ponzi scheme was indicted last month for wire fraud in connection with an alleged theft that occurred prior to her conviction, according to a federal indictment.

    Alice Belmonte, 49, bilked two California real estate investment companies out of approximately $1.8 million in March 2013, according to a May 12 grand jury indictment. Her latest arrest came just over one month after she was released from prison, New York State Division of Parole records show.

    Ms. Belmonte had pleaded guilty in July 2014 to felony larceny, forgery and theft charges stemming from a foreclosure scam in which prosecutors said she forged contracts, faked e-mails from banks and signed her victims’ names for them while she bought new cars and took vacations to California with the stolen funds.

    She was sentenced to serve three to 9 years in state prison, but was granted an early release on April 11, state records show.

    At her latest arraignment in Eastern District Court of New York May 19, Ms. Belmonte pleaded not guilty to two charges of wire fraud and was released on a $500,000 bond, court records show.

    A company connected to her most recent arrest, which was not named in the indictment, has alleged that $1.8 million it had wired to an escrow account Ms. Belmonte set up for real estate investments was redirected in March 2013 to her personal bank account after she forged “fraudulent disbursement instructions” in the name of one of the companies to the escrow company involved in the transaction.

FTC Files Civil Lawsuit Accusing Foreclosure Rescue Operator & Four Attorneys With Running 'Mass Joinder Lawsuit' Racket That Allegedly Promised To Use Legal Challenges To Void Homeowners' Mortgages; Thousand$ In Recurring Monthly Fees Pocketed By Lawyers Were Never Deposited Into Their Trust Accounts As Required By Law

In Washington, D.C., the Federal Trade Commission recently announced:
  • The Federal Trade Commission has charged the operators of a mortgage relief scam with bilking millions of dollars from homeowners by falsely telling them they could join a so-called “mass joinder” lawsuit that would save them from foreclosure and provide additional financial awards.

    “Preying on homeowners who already are financially distressed and struggling to pay their mortgages is appalling,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “That’s why stopping phony mortgage relief operations, like this one, is a priority at the FTC.”

    At the FTC’s request, a federal court temporarily halted the scheme, and the agency seeks to permanently stop the alleged illegal practices and obtain refunds for consumers.

    According to the FTC’s complaint, Damian Kutzner and four attorneys using a set of law firms under the names Brookstone Law and Advantis Law, claimed they would bring lawsuits against lenders for mortgage fraud and void consumers’ mortgage notes “to give you your home free and clear, and/or to award you relief and monetary damages.”

    According to the FTC, the promise of a mass joinder lawsuit is a ruse used by some mortgage relief scams. Unlike class-action lawsuits, in the event of trial each plaintiff would have to prove his or her case separately. Although the defendant attorneys have sued several well-known banks, the FTC has alleged that they have not won any cases and that most were dismissed because they never pursued them. According to the FTC’s complaint, the defendants’ operation did not have attorneys who could litigate hundreds or thousands of cases.

    According to the complaint, the defendants mailed marketing materials to consumers with the homeowner’s name, loan amount and property identification number, with statements such as, “Your home will be sold at Auction unless you take immediate action.” People who responded to the advertising were told they could join a lawsuit by paying $895 or more in advance for a “legal analysis,” and that they were likely or certain to prevail in a lawsuit against their lender; some consumers were told they would recover at least $75,000. After claiming the analysis showed that a consumer had a good case, the defendants charged thousands of dollars in recurring monthly fees through the law firms and failed to deposit the fees in client trust accounts as required by law.(1)

    The defendants falsely promised some clients that they would add them as plaintiffs in lawsuits; they told others they would add them soon but did so only months later. Clients’ requests for information were ignored. In addition, the defendants did not tell people when their lawsuits had been dismissed and kept collecting fees from those clients. Clients’ requests for refunds were refused.

    One of the defendants, Vito Torchia, was disbarred by the California bar for misconduct. During his ethics trial, he conceded that Brookstone failed to provide the most basic elements of legal representation

    The defendants are Damian Kutzner; Vito Torchia, Jr.; Jonathan Tarkowski; R. Geoffrey Broderick; Charles T. Marshall; Brookstone Law P.C., doing business as Brookstone Law Group, a California corporation; Brookstone Law P.C., doing business as Brookstone Law Group, a Nevada corporation; Advantis Law P.C.; and Advantis Law Group P.C. They are charged with violating the FTC Act and the FTC’s Mortgage Assistance Relief Services Rule (MARS Rule) and Regulation O.
Source: FTC Halts California Based Mortgage Relief Scam (Defendants Claimed ‘Mass Joinder’ Lawsuits Would Void Mortgage, Stop Foreclosure).

See also, Exposing a mortgage relief scheme’s empty promises.

See, generally, Frederick Miller, "If You Can't Trust Your Lawyer .... ?", 138 Univ. of Pennsylvania Law Rev. 785 (1990) for more on the apparent, long-standing tolerance for deceit by many in the legal profession:
  • This tolerance to deception is encouraged by the profession's institutional civility. Seldom is a fig called a fig, or a shyster a shyster. No, our euphemisms are wonderfully polite: "frivolous conduct," or a "lack of candor;" or "law-office failure;" or, heaven forbid, a "peculation," a "defalcation," or a "negative balance" in a law firms's trust account.

    There is also widespread reluctance on the part of lawyers --- again, some lawyers --- to discuss publicly, much less acknowledge, that they have colleagues who engage in deceit and unprofessional conduct.

    This reluctance is magnified when the brand of deceit involves the theft of client money and property, notwithstanding that most lawyers would agree that stealing from clients is the ultimate ethical transgression. [...] The fact is, however, that theft of client property is not an insignificant or isolated problem within the legal profession. Indeed, it is a hounding phenomenon nationwide, and probably the principal reason why most lawyers nationwide are disbarred from the practice of law.
(1)The California State Bar's Client Security Fund is a public service of the California legal profession. The State Bar sponsored the creation of this fund to help protect consumers of legal services by alleviating losses resulting from the dishonest conduct of attorneys. The amount the fund may reimburse for theft committed by a California lawyer depends on when the loss occurred. A maximum of $50,000 is reimbursable if the loss occurred before January 1, 2009. A maximum of $100,000 is reimbursable if the loss occurred on or after January 1, 2009.

Unfortunately, because of the number of victimized clients who were screwed over by these attorney-driven foreclosure rescue scams, there reportedly is a long wait for claims to be approved and paid by the Fund. See, for example, California Homeowners' Claims Attributable To Attorneys Running Illegal Loan Modification Rackets Play Significant Role In Driving State Bar's Client Security Fund Into Insolvency.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Maps available courtesy of The National Client Protection Organization, Inc.

Eleven Fleeced Clients Of Five Western NY Ex-Lawyers Are Among Those Who Participated In Record-Setting $12.3 Million Restitution Payout From State's Attorney Ripoff Reimbursement Fund

In Buffalo, New York, The Buffalo News reports:
  • Eleven clients of five former Western New York lawyers were among the 274 recipients statewide last year of the record-setting $12.3 million in restitution paid out by the state’s Lawyers Fund for Client Protection.(1)
    Last year six former clients of the late Ronald D. Anton, a former Niagara Falls-area attorney, or their heirs were reimbursed a combined $115,684. Anton, who had lived on Grand Island, was a widely-respected attorney active as a teacher at various colleges in Western New York and he died as an attorney in good standing on April 1, 2014 at the age of 82, O’Sullivan noted. But, after his death, it was learned there was a significant shortage in the escrow funds he owed clients, resulting in the restitutions.

    A former Western New York couple now living in Pennsylvania was reimbursed the $75,000 former Jamestown lawyer James A. MacCallum allegedly cheated them out of in a loan transaction before he was disbarred in October 2912.

    O’Sullivan noted that MacCallum, a Canadian by birth, was charged this past November by the U.S. Attorney’s Office in Buffalo with using an illegal Ponzi scheme to cheat former clients and investors out of at least $3.4 million in an alleged investment scam he was accused of operating between January 2008 and December 2010.

    Barbara Burns, a spokeswoman for the U.S. Attorney’s Office, said the criminal case against MacCallum is currently in the pre-trial discovery stage.

    One client of David S. Widenor, a disbarred and briefly imprisoned former Buffalo lawyer, received $22,500 from the fund last year. O’Sullivan noted that in August 2014, Widenor pleaded guilty in Erie County Court to second-degree grand larceny charges for failing to pass on to clients more than $226,000 in escrow funds.

    Two North Tonawanda clients of the late Michael J. Ingham, a widely known lawyer practicing in Buffalo and Niagara Falls, shared $3,500 in fund repayments. Ingham died in his Williamsville home on March 16, 2015 at the age of 49.

    One more client of former Erie County lawyer Kenneth P. Bernas last year was repaid $2,325 by the fund, making 39 former Bernas clients the fund had repaid more than $1.7 million since he was sent to prison in 2011 on his felony plea to a number of grand larceny counts that kept him in prison over three years.
For the story, see Clients of five former local lawyers aided by state fund.

See, generally, Frederick Miller, "If You Can't Trust Your Lawyer .... ?", 138 Univ. of Pennsylvania Law Rev. 785 (1990) for more on the apparent, long-standing tolerance for deceit by many in the legal profession:
  • This tolerance to deception is encouraged by the profession's institutional civility. Seldom is a fig called a fig, or a shyster a shyster. No, our euphemisms are wonderfully polite: "frivolous conduct," or a "lack of candor;" or "law-office failure;" or, heaven forbid, a "peculation," a "defalcation," or a "negative balance" in a law firms's trust account.

    There is also widespread reluctance on the part of lawyers --- again, some lawyers --- to discuss publicly, much less acknowledge, that they have colleagues who engage in deceit and unprofessional conduct.

    This reluctance is magnified when the brand of deceit involves the theft of client money and property, notwithstanding that most lawyers would agree that stealing from clients is the ultimate ethical transgression.[...] The fact is, however, that theft of client property is not an insignificant or isolated problem within the legal profession. Indeed, it is a hounding phenomenon nationwide, and probably the principal reason why most lawyers nationwide are disbarred from the practice of law.
(1) The Lawyers’ Fund For Client Protection Of the State of New York manages and distributes money collected from annual dues paid by members of the state bar to members of the public who have sustained a financial loss caused by the dishonest conduct of a member of the New York bar acting as an attorney or a fiduciary.

Typical losses reimbursed by the Fund include the theft of escrow deposits in real property transactions, estate and trust assets, settlements in personal injury litigation, debt collection receipts, money embezzled in investment transactions within an attorney-client relationship and the practice of law, and unearned fees paid in advance to lawyers who falsely promise their legal services.

For similar "attorney ripoff reimbursement funds" that attempt to clean up the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Maps available courtesy of The National Client Protection Organization, Inc.

See generally:
  • N.Y. fund for cheated clients wants thieving lawyers disbarred, a July, 2015 Associated Press story on this Fund reporting that the Fund's executive director, among other things, is calling for prompt referral to the local district attorney when the disciplinary committee has uncontested evidence of theft by a lawyer injuring a client or an admission of culpability;

    When Lawyers Steal the Escrow, a June, 2005 New York Times story describing some cases of client reimbursements ("With real estate business surging and down-payment amounts rising with home prices, the temptation for a lawyer to filch money from a bulging escrow account and later repay it with other clients' money has never been greater, said lawyers who monitor the thefts."),

    Thieving Lawyers Draining Client Security Funds, a December, 1991 New York Times story that gives some-real life examples of how client security funds deal with claims and the pressures the administrators of those funds may feel when left insufficiently financed as a result of the misconduct of a handful of lawyer/scoundrels.

Booted From Legal Profession After Fleecing Clients Out Of Over $330K, Disbarred Attorney Commits Suicide Shortly After Being Tagged w/ Felony Arrest Warrant; Ex-Lawyer Had Also Faced Separate Probe For Allegedly Shuttling Assets To Wife Both Before & After Filing Bankruptcy In Alleged Attempt To Dodge Creditors

In Colorado Springs, Colorado, the Colorado Springs Independent reports:
  • Gregory Chernushin, a local attorney disbarred last year for converting client money to his own use, faces more scrutiny, as does his wife.

    An arrest warrant for Chernushin was issued last week accusing him of six felonies in connection with alleged theft of client money, according to District Attorney's spokeswoman Lee Richards.
    Meantime, Chernushin's wife, Andrea, is the target of a filing in U.S. Bankruptcy Court that seeks an accounting of assets Chernushin transferred to her allegedly to avoid payment of his debts, which include more than $350,000 owed to the IRS, as well as hundreds of thousands owed to clients and others.
    Chernushin, a longtime attorney in Colorado Springs who represented clients injured in car crashes or work-related accidents, closed his practice in early 2015 and stopped communicating with clients. Several clients filed complaints with the Office of Attorney Regulation Counsel alleging he took their settlements without their permission. Chernushin was disbarred in July and admitted in the disbarment agreement he took $334,865 from a handful of clients.(1)
For more, see Disbarred attorney Chernushin faces criminal charges stemming from his law practice.

For the follow-up story, see Colorado Springs attorney suspected of stealing from clients commits suicide:
  • A longtime Colorado Springs attorney charged with stealing thousands of dollars from his clients has killed himself, authorities confirmed [June 9, 2016].

    Gregory Chernushin, 64, was found Thursday morning [June 9] with a self-inflicted gunshot wound at the Target Tree Campground in Hesperus, said La Plata County Coroner Jann Smith. His body was discovered about 8:10 a.m. by workers at the campground on Highway 160 near the Montezuma County line, Smith added.
(1) The Colorado Attorneys' Fund for Client Protection is a fund established by the Colorado Supreme Court to reimburse clients who suffer a loss of money or other property from the dishonest conduct of their attorney. Additionally, the loss must arise out of and by reason of an attorney-client relationship or a court-appointed fiduciary relationship between the attorney and the screwed-over victim. The fund is a remedy of last resort for clients who cannot be repaid from other sources, such as from insurance or from the attorney involved. Claimants are expected to make reasonable efforts to collect from these other sources first.

According to this story, the Fund has, as of February, 2016, roughly $4 million available to clients who were victims of dishonesty by their lawyers, according to Jamie Sudler, chief deputy regulation counsel in the Office of Attorney Regulation. Sudler reportedly said, "We're really, really interested in getting the word out and we try as hard as we can to let people know about it."

If you believe you have lost money or property as a result of the dishonest conduct of your attorney who either is licensed in Colorado, or unlicensed but nevertheless practicing in the state, you should start by filing a disciplinary complaint against the attorney with the Colorado Supreme Court Office of Attorney Regulation Counsel.

For similar "attorney ripoff reimbursement funds" that attempt to clean up the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Maps available courtesy of The National Client Protection Organization, Inc.

    Law Firm Trust Account Irregularities Trigger Police Probe, Ultimately Landing Office Manager With Past History Of Embezzlement & Rubber Check Writing 7 To 9 Years Prison Time For Siphoning $150K+ From Employer's Bank Accounts

    In Wilmington, North Carolina, WECT-TV Channel 6 reports:
    • A Wilmington woman pleaded guilty [] to stealing thousands of dollars from her employer.

      According to District Attorney's Office, Felicia Kelley, 44, was accused of embezzling from the law firm Yow, Fox & Mannen, L.L.P. and pleaded guilty to one count of embezzling greater than $100,000.

      Kelley was sentenced to 7-9 years in prison and will be forced to pay back over $145,000 in restitution to the victims.

      The Wilmington Police Department was contacted by partners at the law firm when they noticed a discrepancy in their trust account in November of 2015. When trying to locate the missing money, other financial discrepancies were ultimately linked to Kelley, who was the office manager and bookkeeper.

      The discrepancies included $10,000 in missing cash and checks written to Kelley's husband, juvenile son and boyfriend. Kelley disguised the checks as legitimate business expenditures for the law firm. A forensic audit found a total loss in excess of $153,000.

      Kelley was in Colorado at the time the warrants were issued for her. She was arrested and extradited back to North Carolina in December 2015.

      She has also been previously convicted of a lower class embezzlement at another law firm in Jacksonville, misdemeanor embezzlement in Virginia and has worthless check convictions in North Carolina. These convictions, however, were under a different name and were not identified in her employer's background check.

      “This case was handled by the [North Carolina] Financial Crimes Division of the Conference of District Attorneys, which is an elite group of prosecutors. We rely upon this division in complex, multi-jurisdictional, and conflicts cases. Today’s result once again demonstrates our joint commitment to hold white collar criminals fully responsible under the law,” stated District Attorney Ben David.

    Friday, June 24, 2016

    Philly Feds Pinch Closing Agent For Allegedly Using Escrow Account That Held Proceeds From Real Estate Transactions As His Personal Piggy Bank While Leaving Over $2.9 Million In Mortgages Unpaid

    From the Office of the U.S. Attorney (Philadelphia, Pennsylvania):
    • Alfred Drechsel, 47, of Voorhees, NJ was charged by Information with one count of wire fraud in connection with a scheme that defrauded borrowers and title insurance companies, announced United States Attorney Zane David Memeger.

      Drechsel was an owner of Lenders Edge Settlement Services, LLC, (“Lenders Edge”) and Integrity Assurance Inc. (“Integrity Assurance”), located in Feasterville, PA. The information alleges that Drechsel, who was responsible for making the loan disbursements, diverted settlement funds into various Lenders Edge and Integrity Assurance bank accounts and used the diverted loan proceeds to pay off other unrelated mortgages, to pay other business expenses, and for personal expenditures.

      According to the information, the total amount of mortgages that the defendant failed to pay off as required by the settlement statements was approximately $2,919,186.61.

    Antitrust Feds Bag One More In Ongoing Probe Into Bid Rigging At Public Foreclosure Auctions In Southern Alabama

    In Washington, D.C., the U.S. Department of Justice announced:
    • An Alabama real estate investor pleaded guilty for his role in a conspiracy to commit mail fraud at public real estate foreclosure auctions held in southern Alabama, the Department of Justice announced [].

      Adrian J. Beach admitted that he conspired with others to, among other things, defraud financial institutions, homeowners and others with a legal interest in rigged foreclosure properties, out of proceeds from foreclosure auctions. Beach is charged with participating in the conspiracy from January 2004 through March 2010. Financial institutions and homeowners suffered monetary losses as a result of the conspiracy.
      Beach is the fourteenth defendant prosecuted in the Antitrust Division’s ongoing investigation of bid rigging and other fraudulent conduct in the Alabama real estate foreclosure industry.

      The investigation into fraud and bid rigging in the Alabama real estate foreclosure industry is being conducted by the Washington Criminal II Section of the Antitrust Division, and the FBI’s Mobile Field Office, with the assistance of the U.S. Attorney’s Office for the Southern District of Alabama.

      Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the 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

    Thursday, June 23, 2016

    Foreclosed Connecticut Homeowner Who Lost All Her Worldly Possessions After Getting The Boot Scores "Six-Figure" Settlement After Judge Tags State Marshal w/ Liability For Illegally Disposing Of Victim's Stuff & Not Storing It In Designated Facility

    In Bristol, Connecticut, The Connecticut Law Tribune reports:
    • A Superior Court judge said state law does not give state marshals the right to 'dispose of the personal property of the person subject to ejectment other than to store it in a designated facility.'

      Barbara McLoughlin had already suffered one devastating blow when she lost her home in Bristol to foreclosure. But then the state marshals came to evict her.

      McLoughlin was preparing to move and came home from work to find her car and everything she owned cleared out, said Ray Hassett, her attorney with Hassett & George. She was left without her home and bereft of everything she owned.

      The loss of all her personal property, including the uniform her father wore in World War I and her mother's jewelry, started McLoughlin on a legal quest that tested for the first time in Connecticut whether a state marshal has a duty to protect the property of the people they evict.

      On Oct. 26, 2012, then-Connecticut Marshal Jerome Martin alleged he was carrying out a court order to perform an ejectment at McLoughlin's foreclosed home. He said he found McLoughlin's personal property infested with fleas and abandoned.

      McLoughlin countered that Martin failed to follow the court order that he was supposed to notify her where her property would be stored. Instead, her property disappeared and she was only able to recover her vehicle.

      Martin also argued that McLoughlin did not have standing to bring a legal action against him and he did not owe a duty to protect her personal property during the execution of the judgment. State marshals are independent contractors appointed as public officers with the authority to enforce court orders, including the execution of ejectment orders.

      The law says marshals may remove the personal property of people who are being removed from their foreclosed homes. But once that decision is made, Hassett argued, the law requires the marshal to give notice to the homeowner and take the property to a municipal storage facility.

      In this case, Martin wrote on his ejectment order that McLoughlin's personal effects would be stored with the town. No phone number was listed on the order that would have enabled McLoughlin to track down her possessions. Instead, all her worldly goods disappeared, some apparently going to the town dump and others apparently taken by members of outside firms brought in by the marshal.
      Following the judge's decision, the case settled for a six-figure sum. Hassett would not disclose the full sum, but did say that the marshal had insurance and his client has been paid in full.
    For more, see Judge Holds State Marshal Accountable for Evicted Homeowner's Missing Belongings (Judge says state marshals are accountable for evicted residents' belongings) (may require paid subscription; if no subscription, GO HERE, then click the appropriate link).

    Tampa Lawsuit Accuses Four Banksters Of Bullying Elderly Homeowner To Death; Family Claims Repeated Debt Collection Robocalls To Cellphone Seeking Money That Wasn't Owed Began Health Spiral That Led Senior Citizen To Drop Dead Of Heart Attack During Foreclosure Hearing

    In Tampa, Florida, ABC Action News reports:
    • At 67, Kimberly Collelo's father Frank Collelo showed little sign of slowing down. Collelo and her sister Amanda say their dad's golden years turned dark after he applied for a mortgage modification.

      Relatives say he faxed the bank the requested documents over and over again without response.

      The family and their attorney, Billy Howard with the Consumer Protection Firm, claim Frank never missed a house payment until he applied for the modification.

      According to a lawsuit, Bank of America, M & T Bank and two other loan servicers robo dialed Collelo’s cellphone up to eight times a day everyday between 2014 and 2015 attempting to collect money he did not owe.

      The calls took a toll, according to his daughters, who say he would become short of breath and upset when the phone rang. In 2014, Frank Collelo left his home in Valrico and gave it back to the bank. Still the calls continued.

      On March 3, 2015, Collelo dropped dead of a heart attack. He died inside a court room in the middle of his foreclosure hearing.

      Their lawsuit accuses the defendants of violating both the federal and Florida robo calling laws. But this case filed in Tampa federal court is unprecedented. It blames the banks for robo bullying Frank Collelo to death.

      Stetson Law Professor Dr. Thomas Kaye says while it's possible to convince a jury robo calls played a role in the death, the legal challenge remains.

      "We have a statute in Florida that deals with robo calling, and it provides a financial payment to be made for each wrongful call but it doesn't say anything if someone dies as a result," Kaye said.

      For the Collelo sisters the case isn't about setting a precedent. It is about fighting for a father who can no longer defend himself.

      We reached out by phone and email to all four defendants. Bank of America, M & T Bank and Caliber Home Loans refused to comment on pending litigation. Lakeview Loan Servicing has yet to respond.
    Source: First of its kind lawsuit accuses banks of killing customer (Robo bullying case unprecedented).

    Wednesday, June 22, 2016

    Federal Court Green-Lights Elderly, Dementia-Stricken Veteran's Lawsuit Accusing D.C. Of Violating His 5th Amendment Rights By Swiping His $200K Free & Clear Home Over Unpaid $134 Tax Debt & Refusing To Fork Over The Proceeds For His Surplus Home Equity From Tax Sale

    From a recent post on the Pacific Legal Foundation's(1) Liberty Blog:
    • [Last] week, in Coleman v. District of Columbia, a federal district court held that the plaintiffs have grounds to bring their Fifth Amendment challenge to the District of Columbia’s taking of their property under its former tax-foreclosure scheme.

      Liberty Blog readers may recall that PLF filed a friend-of-the-court brief in support of Benjamin Coleman, an elderly veteran who suffered from dementia. Mr. Coleman owned his $200,000 home lien-free when the District of Columbia took the home to pay an overdue $134 tax debt, plus penalties, interest, and fees.

      Despite the fact that Mr. Coleman’s property was very valuable, and his tax debt was small, District law did not allow Mr. Coleman to collect any of the surplus profits from the tax sale.

      The District later amended that law, when the Washington Post exposed the unjust tax foreclosure scheme,(2) but it did not compensate Mr. Coleman. A representative for Mr. Coleman sued on his behalf, arguing the District’s scheme violated the Fifth Amendment’s maxim that government cannot take property unless it pays just compensation for the property. In other words, while government may keep fees, penalties, and interest when it sells property to pay a tax debt, it must pay the property owner for the surplus equity it takes.

      Last summer, the District asked the court to rule against Mr. Coleman and the other plaintiffs, arguing that taxpayers forfeit their constitutional property rights when they fail to pay their property taxes on time. PLF argued that the government cannot be allowed to redefine property rights or forfeitures in that manner. If state and federal governments were allowed the final say on what constitutes a forfeiture of constitutional rights, then government would find it all too easy to take property from the public.

      [Last] week, the court thanked PLF for its amicus brief and denied the District’s motion, holding that Mr. Coleman and the other plaintiffs may proceed with their Fifth Amendment challenge.
    Source: Challenge to Washington, D.C.’s tax scheme moves forward.
    (1) Pacific Legal Foundation is a Sacramento, California-based, donor-supported public interest legal organization that litigates cases throughout the United States for property rights, limited government, and free enterprise.

    (2) See The Washington Post: Homes for the Taking (Liens, losses and profiteers).

    Snoozing Michigan Property Owner Forfeits Title To Vacant Lot Over Failure To Pay $7 Late Fee On Her Local Real Estate Taxes

    In Hillsdale County, Michigan, Michigan Capitol Confidential reports:
    • A vacant lot owned by a Jackson woman was foreclosed by Hillsdale County because she failed to pay a $7 late fee on her property taxes.

      A Freedom of Information Act request found that Pam Baker, a Jackson resident, owed Hillsdale County $7.70 in interest and late fees for delinquent taxes from 2013 on land she owned near Lake LeAnn in Somerset Township.

      The 2013 taxes on the property, which she owned since 2000, were due on Feb. 14, 2014. Baker says she paid her taxes two weeks late because she was in a car crash seven days before the due date.

      Hillsdale County Treasurer Gary Leininger confirmed that Baker paid her taxes, albeit late. He said Baker likely paid the taxes to the township where the property is located, and then the township treasurer turned the payment over to the county treasurer, which is responsible for collecting delinquent taxes.

      Baker paid $161.29 on March 18, 2014, according to Leininger. The $7.70 was, he said, a balance due from interest and a four percent late fee.

      “That’s standard operating procedure for county treasurers all over the state,” Leininger explained. “She would have received a paid receipt, but it clearly showed it was a partial payment and there was a balance due."

      Leininger said the receipt would have shown a balance of less than $10 and Baker never responded.

      Baker claims she didn’t receive any notices stating that a failure to pay the late fee would result in a forfeiture of the property. Baker’s property was forfeited on March 1, 2015.(1) According to documents included in the FOIA, a notice of judgement of foreclosure was issued Feb. 26, 2016, which stated the foreclosure would become final on March 31, 2016.

      Baker said she called the county clerk to find out what she owed on the property, and that’s when she found out it had already been foreclosed.

      “I called there and couldn’t believe my property was foreclosed,” she said. “I couldn’t believe it. I didn’t receive anything.” “I was just calling to see what I owe, but I didn’t know what it was for,” she said. “I never signed anything.”

      Leininger disputed Baker’s claim that she did not receive any notifications. Documents received from the FOIA request show that Hillsdale County sent delinquent tax notices in 2014, postmarked June 1 and Sept. 1, to Baker's home address in Jackson. The notices said she owed $7.70. If she paid after Aug. 31, the fee would go up to $9.16. The second notice stated the fee would go up to $24.39 if the bill were paid after Nov. 30.

      Documents also show that the county sent a notice of forfeiture to Baker’s Jackson residence on June 30, 2015, through certified mail.(2) Tracking information indicates that the mail was not signed for, so a notice was left at Baker’s home and the mail was returned to the Hillsdale County treasurer's office.

      The county also posted a notice on the Somerset Township lot and published notices in the Hillsdale Daily News three weeks in a row in January 2016. But Baker said she rarely visited the property, which is why she never saw any notices posted there, and she doesn’t receive the Hillsdale Daily News.

      “The thing that gets me is, I have a phone number and they know what it is,” she said. “Why didn’t someone call me?”

      “I had a 'for sale' sign on the property with my phone number on it,” she added.

      Leininger, who sent an agent to post a notice on the property on Jan. 15, 2016, said county treasurers are not required by law to call delinquent taxpayers, nor did the county know Baker’s phone number.

      He also said the last time the county heard from Baker, who has not paid her 2014 or 2015 property taxes, was March 18, 2014, when the county processed her payment on the delinquent 2013 taxes, absent the interest and late fee. “We never heard from her since, until after the foreclosure was final,” he said.

      “In my view, the lady doesn’t have a leg to stand on,” Leininger said.
    For the story, see County Takes Michigan Woman's Property Over $7 Late Fee (Treasurer: 'Lady doesn't have a leg to stand on').
    (1) In a similar case (see Federal Court Green-Lights Elderly, Dementia-Stricken Veteran's Lawsuit (Accuses D.C. Of Violating His 5th Amendment Rights By Swiping His $200K Free & Clear Home Over Unpaid $134 Tax Debt & Refusing To Fork Over The Proceeds For His Surplus Home Equity From Tax Sale), a Washington, D.C. homeowner is currently suing the District, and is advancing the argument that the process it used for foreclosing on homes for unpaid tax debt violated the U.S. Constitition's Fifth Amendment’s maxim that government cannot take property unless it pays just compensation for the property (i.e. the government may keep what it's owed when selling property to pay a tax debt, but it must pay the property owner for the surplus equity it takes. See Challenge to Washington, D.C.’s tax scheme moves forward.

    If, in fact, the tax foreclosure process in Hillsdale County, Michigan operates as a forfeiture of property and where the foreclosed homeowner gets nothing for any accumulated equity for her home (the way it did in the aforementioned Washington, D.C. case), the tax-foreclosed Michigan homeowner may have similar grounds for a lawsuit against the county for taking her property without paying her just compensation in violation of her 5th Amendment rights.

    (2) Ibid.

    Tuesday, June 21, 2016

    Oregon Non-Profit Group Acts As Intermediary That Organizes & Assists Mobile Home Residents To Avoid Eviction, "Control Their Own Lives" By 'Buying The Dirt' Underneath Their Homes From Lot-Leasing Landlords Looking To Sell, Cash In

    From a recent story in the Portland (Oregon) Tribune:
    • [B]uying the dirt

      CASA of Oregon,(1) which stands for Community and Shelter Assistance Corp., expanded into mobile home buyouts after a wave of park closures in 2007, says Peter Hainley, the executive director.

      So far, the group has helped nine mobile home parks form cooperatives and get financing to buy out their landlords.

      Mobile home owners have little recourse when their landlords slap yearly rent increases on them, because they own their homes but it’s very costly to move them, even if they can find a park that will accommodate them.

      “The down side is you don’t own the dirt,” says John Van Landingham, a staff lawyer for Lane County Legal Aid Advocacy Center,(2) who has worked in the mobile home field for 40 years. But when tenants buy the land, “they get to control their own lives,” he says.

      Under the 2014 law that Van Landingham helped write, owners must provide tenants at least 10 days to fashion buyouts after giving notice their parks are for sale. That’s when CASA of Oregon steps in.

      It can make offers to buy the complexes, and get access to confidential financial information about the parks. CASA has relationships with lenders that provide low-interest loans, and mobile home owners help pay off the loans via their monthly space rent.

      CASA builds in extra money in its deals so there is some funding to spruce up the parks, which often are in disrepair when an owner decides to redevelop their property for something more lucrative.

      “We want to upgrade the (Oak Leaf) park, so we don’t look like we’re a bunch of derelicts,” says Renae Corbett, who has emerged as a leader of the park residents. “We may have to raise the rent, maybe 50 bucks,” she says, to help finance the deal.

      Many park residents have construction skills, and can supply some sweat equity, Corbett says.

      “For minimal dollars you do the fix-up,” says resident Larry O’Mara. “It’s not as expensive as people think.”

      Because it’s so costly and difficult to move mobile homes, some are advertised on Craigslist for free, O’Mara says, for folks who will move them. “Some of them are in really fine shape.”
    Source: Mobile Home Owners Unite To Thwart Eviction.
    (1) Casa of Oregon is a private non-profit community development corporation that advocates statewide for the needs of low-income families in connection with providing affordable housing, neighborhood facilities, and programs that enhance their financial well-being.

    (2) Lane County Legal Aid Advocacy Center is a non-profit law firm that provides civil legal assistance in Lane County, Oregon to people in poverty, many recipients of public benefits, and many persons who experience disabilities, as well as people 60 and over.

    Exploding Portland Land Prices Strike Fear In Homeowners Leasing Lots In Mobile Home Parks; Despite Owning Their Homes, Concerns Remain Constant That Park Operators Could Sell Land Out From Under Them, Subjecting Residents To Steep Space Rent Increases ... Or Worse

    In East Portland, Oregon, the Portland Tribune reports:
    • Diane Pense figured she and her husband were pretty set for retirement in their cozy manufactured home in East Portland.

      Their double-wide unit, with three bedrooms and two baths, was only 21 years old and in great shape — and they owned it outright.

      “We didn’t feel vulnerable at all,” says Pense, 67.

      Then, last August, the landlord notified the Penses and nine other families at the Lostinda Woods manufactured home park that their complex at Southeast 125th Avenue and Foster Road was being sold.

      A couple weeks later, new owner Hichi Investments LLC sent word that the Penses’ space rent would spike from $573 to $964 a month, and tenants would have to start paying for garbage, cable TV, water and sewer utilities previously covered by the rent. Hichi demanded residents sign a letter agreeing to the rent hikes and return it in 15 days.

      “It came as a slap in the face, a shock,” Pense says. “If we didn’t sign it, we had to be out by Dec. 30 and move our homes, or forfeit our homes.”

      Mobile homes aren’t so mobile, and can cost more than $20,000 to move — if owners can find a suitable park with an empty space available. So [Oregon] state law actually requires a year’s notice before manufactured home park owners can evict tenants to redevelop their property. But that deadline is fast approaching, and nine of the 10 Lostinda Woods owners sold their homes at a loss, Pense says.

      The Penses sold theirs — appraised at $55,000 — for only $25,000, and cleaned it out last week. They bought another manufactured home at a Milwaukie park for $58,000.

      “Now we’re retired and we have to take another mortgage,” she says, on top of paying the space rent.

      Mobile home parks and manufactured home parks are an important source of affordable housing in Oregon. But Portland’s exploding land and housing prices could easily spur a wave of park closures — and homeowner evictions — in Portland and elsewhere. That’s sure to worsen the housing crisis.
      It’s terrible to own your own home yet have to constantly worry the land beneath you could be sold, [Rita] Loberger says. She’s a volunteer leader of the Manufactured Housing/Oregon State Tenants Association, and often hears of park residents’ fears via the group’s hot line.

    Some NE Pennsylvania Residents Fear Mobile Home Park Operator's Changes In Lot Lease Terms May Be First Step In Effort To Evict Them & Wrestle Away Ownership Of Their Homes

    In Middle Smithfield Township, Pennsylvania, the Pocono Record reports:
    • A new, lengthy set of lease guidelines for properties in Rocky Ridge Estates in Middle Smithfield Township have caused a rift between a group of residents and the relatively new owners.

      While the owners insist the new 44-paged lease contract distributed to the residents of the mobile home park are being misinterpreted by residents, about 70 percent of residents in the 90-home private community did not return a signed agreement to the new rules and regulations by the June 1 deadline. When the new guidelines go into effect July 1, some residents aren’t sure where they will be living.

      Chris Dougherty, an estate resident for three years and son of former estate owner Dennis Dougherty, believes current owners Cole and Amber Peffer intend to systematically take ownership of homes through evictions brought on by violation of new rules and regulations. He pointed to particular yard maintenance and property upkeep regulations that could require residents to spend more than they would be able to afford in contracted work.

      “The first time someone gets evicted for a driveway not being paved, it’s game on,” Dougherty said. “It’s greed at that point."

      Concerns over new rules

      Dougherty said the new contract spurned him to visit other residents and gauge their opinion, and found most were as concerned as he was. He noted that some people living in the community are on fixed incomes, unable to afford something like a four-figure tree removal service if it’s required.
      Residents fear losing homes

      [A] regulation that states homes that have not been occupied for 30 days are considered abandoned — and require a doubled rent fee — convince Dougherty the owners’ intent is to own more homes. A line in the abandonment clause states “the community may petition the court to be awarded title to any abandoned home.”

      Dougherty believes residents will either be evicted due to failure to improve their properties, leave due to disagreement with the new lease guidelines or become unable to afford new and added costs for living.

      “All paths lead to them taking your home,” Dougherty said.

    Monday, June 20, 2016

    Help Wanted: Corrupt Loan Servicers Seek Sleazy Individuals To 'Manufacture' Missing Mortgage Docs; Ability To 'Prove Up' Broken Chains Of Title With With Forged Paperwork On Loans Entering Foreclosure A Must

    Investigative reporter David Dayen writes in The Intercept:
    • RECRUITERS ARE HIRING for a job that shouldn’t exist: finding “missing” documents required to “complete” broken chains of title on mortgages entering foreclosure.

      Since all assignments of mortgage should have been prepared and recorded within days of the transfer or sale — and the failure to do so irreparably ruptures chain of title — the companies would seem to be looking for time travelers or magicians.

      Or maybe they want to manufacture false evidence to introduce into courts as a means to take away people’s homes.

      Without a chain of title documenting the sequence of historical transfers of title to a property, foreclosure proceedings cannot continue in a legal fashion.
      The multiple job listings for specialists to fix broken chains of title only confirms that nothing has changed in the industry. No mortgage company would require a chain of title specialist if the documents needed to foreclose existed.

      It’s possible the missing documents merely need to be located. But the presence of an entire industry of third-party “default services” companies that recreate mortgage assignments suggests that this isn’t a case of lost-and-found. Last September, one such third party, Security Connections of Idaho Falls, Idaho, was caught soliciting individuals to forge mortgage documents.

    Brooklyn Man Gets 9 To 18 Years For Running Real Estate Title Hijacking Racket; Defendant Used Backdated Forged Deeds, Other Paperwork In Effort To Swipe Ownership Of Property

    From the Office of the Kings County, New York District Attorney:
    • Brooklyn District Attorney Ken Thompson [] announced that a Brooklyn man was sentenced to nine to 18 years in prison for stealing three Brooklyn properties by forging deeds, pretending to be an attorney and selling, or attempting to sell, them to buyers. He sold one empty lot twice and received bids on another home in excess of $1 million.

      District Attorney Thompson said, “This defendant shamefully stole houses and other property from their rightful owners by using forged documents, engaging in deceit and committing outright fraud. He did so solely to exploit the lucrative real estate market in Brooklyn. And now he will spend many years in prison where scammers like him belong.”

      The District Attorney identified the defendant as Carl Smith, 50, of Lafayette Avenue in Brooklyn. He was sentenced [] by Brooklyn Supreme Court Justice Alexander Jeong to an indeterminate term of nine to 18 years in prison following his conviction on May 23, 2016 after a jury trial of two counts of second-degree grand larceny, two counts of third-degree grand larceny, two counts of first-degree offering a false instrument for filing, one count of second-degree criminal possession of a forged instrument and unlawful practice of law. The defendant, who has numerous prior felony convictions, was facing mandatory prison time for the conviction.

      The District Attorney said that, according to testimony at trial, in February 2011, the defendant stole 45 Lewis Avenue, a lot in Bedford-Stuyvesant, by filing a backdated deed containing the forged signature of a man who bought the lot in 1999. Having been granted ownership of the property, the defendant sold it twice: in March 2011 to the owner of an adjacent laundromat for $12,000 and in April 2011 to another man for $11,000.

      The evidence further showed that the defendant stole 139 Vanderbilt Avenue, a three-story brownstone in Fort Greene. The house was purchased in 1982 by Dolores Teel, who died in 2001, with the home passing on to her family members. Around April 2011, the defendant filed a deed, backdated prior to Teel’s death and bearing her forged signature, to gain ownership of the house. He received several bids from potential buyers, some exceeding $1 million, but was not able to produce a valid title to complete the sale.

      Around October 2012, according to testimony, the defendant negotiated a deal to sell 64 Hart Street, a multi-family home in Bedford-Stuyvesant, by falsely representing himself to be the owner’s attorney and presenting documents containing her forged signature. The property was purchased in 1975 by Mary Brown and was inherited by her daughter when she died in 1994. An investor the defendant was negotiating with paid him over $20,000 for the deed and related fees after the investor was provided with fraudulent contract of sale and deed.

      The jury additionally heard evidence about an uncharged larceny in which the defendant stole 543 Lexington Avenue, a two-story home in Bedford-Stuyvesant. He did that around May 2003 by, again, forging and backdating a deed. The defendant then sold that home to an associate, bringing eviction proceedings against the rightful owner, Jerome Farrell, who lived there until his death in February 2015.

      The defendant was indicted and arrested in 2013 and was later charged in a separate 2014 indictment in relation to the Lewis Avenue property.
    Source: Brooklyn Man Sentenced to up to 18 Years in Prison for Stealing Three Properties in Bedford-Stuyvesant and Fort Greene (Forged Deeds, Acted as an Attorney and Took in over $43,000; Tried Selling another Brownstone for over $1 Million).

    Sunday, June 19, 2016

    Grieving Brooklyn Mom Faces The Boot For Rejecting Landlord's Demand To Get Rid Of Recently-Deceased, Cancer-Stricken 9-Year Old Son's Emotional Support Dog; With Help From Pro Bono Lawyer, She Responds w/ Federal Lawsuit To Halt Eviction, Seek Reasonable Accommodation

    In Brooklyn, New York, the New York Daily News reports:
    • A grieving mom, who recently lost her 9-year-old son to brain cancer, is facing eviction from her Brooklyn apartment for rejecting the landlords’ demand that she get rid of the little dog that once comforted the terminally ill boy.

      Monique James, 40, filed a lawsuit [last week] in Brooklyn Federal Court to stop the eviction proceedings and seeks a reasonable accommodation so the Bichon Frise named King can stay in the dog-free building.

      “I can’t get rid of the dog. The dog is a part of my family,” James told the Daily News. “It’s my son’s dog and I feel like when I’m with the dog, I’m with him in a sense.”

      King hasn’t left her side since her son Jelani died on March 22.

      James, an administrator at Interfaith Medical Center in Brooklyn, has lived at the building on Park Place in Brownsville since 2011 with her daughter Leila, 17, and Jelani, who was diagnosed with a brain tumor and hydrocephalus early last year.

      She purchased the dog for Jelani in May 2015 to provide him with companionship and to reduce the bedridden child’s pain, depression and anxiety, according to the lawsuit.

      “Him and the kid were un-detachable,” James told The News. “It was just them two, 24 hours a day. The dog was in bed with him.”

      Jelani and King became “best friends,” she added.

      A month later, all the tenants in the building received a notice warning that keeping animals in their apartments was a violation, without exception, of their leases.

      King remained by Jelani’s side, and the landlords went to housing court to toss the family out on the street.

      It appeared the matter might be resolved when James was allegedly informed by management that the dog could stay as long as she provided proof of immunization. But when James was handed papers to sign, she was shocked to read King could remain only until “the demise” of Jelani.

      James broke down in tears and refused to sign the agreement.

      “I tried to reason with them on a humanitarian level as to why I had the dog,” she recalled. “They kept me going to court while my son was sick.”

      The building is owned by nonprofit Park Monroe II Rehab Housing, and managed by Northeast Brooklyn Housing. The defendants’ lawyer Edward Weiss said he could not comment until he’s had a chance to review the suit with his clients.

      “No compassion, no humanity — they just don’t care,” James said of management’s response to Jelani’s death.

      Her lawyer Chantal Johnson, of Brooklyn Legal Services,(1) agreed.

      “Requiring her to remove the dog is egregious and indefensible,” Johnson said.
    For more, see Grieving mom faces eviction from Brooklyn apartment for keeping dead son’s dog.
    (1) Brooklyn Legal Services is part of Legal Services NYC, a non-profit organization providing legal services for low-income residents of New York City.

    Managing Agent Slammed w/ Court Order To Cough Up Over $44K For Violating Fair Housing Act After Refusal To Rent Single Family Home To Tenant w/ Mental Disabilities; Said Landlord “Did Not Want A Bipolar In The House"

    From the U.S. Department of Housing & Urban Development (Washington, D.C.):
    • The U.S. Department of Housing and Urban Development (HUD) [] announced that a HUD Administrative Law Judge ruled against a northern Minnesota landlord charged with refusing to rent an apartment to prospective tenants because of their disabilities. Landlord Deane Woodard of Detroit Lakes, Minnesota was ordered to pay $27,000 to one woman,(1) a $16,000 civil penalty,(2) and $1,000 in other court sanctions. Read the ruling.

      The Fair Housing Act prohibits discrimination in the sale or rental of a dwelling on the basis of disability. Housing providers may not refuse to rent to persons with disabilities.
      In August 2015, HUD charged property manager Deane Woodard with making discriminatory statements to a prospective tenant and her roommate, and refusing to rent a home in Detroit Lakes, Minnesota to them because they have mental disabilities. In an order earlier this year, the Administrative Law Judge found that Woodard had violated the Fair Housing Act.

      Prior to learning about the prospective tenants’ mental disabilities, he had agreed to rent to them and had even provided them with a key to the house. However, when the woman, her parents, and her roommate drove to the house to give the manager a security deposit and begin the process of moving in, Mr. Woodard told the group that the woman and her friend could not rent the property because of their disabilities. Among other statements, the manager told the women that the ownerdid not want a bipolar in the house.”
      People who believe they have experienced discrimination may file a complaint by contacting HUD’s Office of Fair Housing and Equal Opportunity at (800) 669-9777 (voice) or (800) 927-9275 (TTY). Housing discrimination complaints may also be filed by going to, or by downloading HUD’s free housing discrimination mobile application, which can be accessed through Apple and Android devices.
    Source: HUD Administrative Law Judge Rules Against Minnesota Landlord Charged With Discriminating Against Persons With Disabilities.

    For the ruling of the HUD ALJ, see Secretary of HUD v. Woodard, 15-AF-0109-FH-013 (May 9, 2016).
    (1) According to the court ruling, the amount pocketed by the complaining tenant ($27,122.67) breaks down as follows:
    • $ 5,000 for lost housing opportunity,
    • $1,594.67 for the extra time and money associated with her longer commute from her new apartment (an extra 26 minutes per day commuting to and from work for just under one year),
    • $528 for her time spent participating in the prosecution of this case (33 hours x $16/hour), and
    • $20,000 for emotional distress damages.
    (2) A $16,000 civil penalty was the most the court could impose when belting a first-time offender in this type of case. Part of the court's rationale for hitting up the managing agent with the maximum follows ("Respondent" refers to the managing agent):
    • Respondent's behavior merits imposition of a maximum civil penalty. The outright refusal to rent is arguably the most egregious form of fair housing violation, as it completely denies an individual a valuable housing opportunity.

      Respondent's actions are particularly severe in this case because they came late in the rental process. Complainant already had the keys to the property, and was mere minutes away from beginning the move-in process. She had no reason to suspect Respondent would block her path, literally at the front door. She thus had no opportunity to psychologically prepare for the shock and disappointment she experienced.

      Moreover, Respondent made his discriminatory comments directly to her or in her presence. He has shown no remorse for his conduct. If his brief communications with the Court are any indication, Respondent still does not believe he has done anything improper. A maximum penalty is necessary to impress upon him the severity of his misconduct.
      Maximum penalties should be reserved for the most egregious cases and imposed where needed to vindicate the public interest. In this case, although a first offender, Respondent has thumbed his nose at the system with regard to the prosecution of this case. He has refused to participate in these legal proceedings, other than mailing a handful of hastily written notes to HUD Counsel and the Court.

      He failed to appear for his deposition, causing HUD to waste taxpayer dollars. He refused to accept phone calls from HUD Counsel, and prematurely terminated a teleconference call with the presiding Administrative Law Judge. Respondent has made it unmistakably clear that this proceeding is beneath his interest. By doing so, he has shown no concern for the law or the civil rights of Complainant, Jane Doe 2. He is completely unrepentant. Indeed, his refusal to participate in these proceedings suggests disrespect for, or contempt of, the Fair Housing Act and this Court, and is an appropriate additional factor to consider in assessing a civil penalty. Respondent's dismissive attitude overshadows any other factors that might have otherwise suggested a less-than-maximum penalty.

      Upon consideration of all six factors, the Court finds that Respondent's conduct was especially egregious and must be met with a harsh penalty to deter similar behavior by himself or others in the future. Additionally, Respondent is directly culpable, and has not shown any measure of concern or remorse for the consequences of his actions. Accordingly, a maximum civil penalty of $16,000 is necessary.

    Nevada Couple To Cough Up $36K To Resolve Fair Housing Charges That They Indicated A Preference For Adult Tenants For Their Rental Properties, & Refused To Rent Single Family Home To Tenant w/ Kids; Family Who Was Allegedly Told By Landlord To Take A Hike To Pocket $12K In Damages

    The U.S. Department of Justice recently announced:
    • The Justice Department announced [] that Carson City, Nevada, rental property owners Betty Brinson and Hughston Brinson have agreed to pay $36,000 to resolve allegations that they discriminated against families with children in violation of the Fair Housing Act (FHA).

      The lawsuit alleged that the Brinsons discriminated against families with children by placing a series of advertisements for a single-family rental home in the local newspaper that indicated a preference for adult tenants and refusing to rent the home to a family with three children because they did not want children living at the property.

      The complaint also alleged that Betty Brinson placed discriminatory advertisements for another property she owns – a 36-unit apartment complex in Carson City – that indicated a preference for adult tenants. The lawsuit arose as a result of a complaint filed with the Department of Housing and Urban Development (HUD) by the family, who alleged that they were refused the opportunity to rent the single-family home.

      Under the proposed consent order, which still must be approved by the U.S. District Court for the District of Nevada, the defendants will pay $14,000 to the HUD complainants, $10,000 into a victim fund to compensate other aggrieved families and $12,000 to the United States as a civil penalty. In addition, the proposed consent decree prohibits the defendants from discriminating in the future against families with children and requires the defendants to receive training on the requirements of the FHA and provide periodic reports to the department.

    Small Upstate NY Town Gets Hit w/ Fair Housing Lawsuit Over Refusal To Issue Building Permit For Group Home Intended To Serve Four Developmentally Disabled Adults

    In Erie County, New York, The Buffalo News reports:
    • Scott Gehl thought the group homes war was over.

      Even now, years later, he remembers the late 1970s and early 1980s as the time when neighborhood and municipal opposition to group homes grew into a major front-burner issue.

      Decades later, Gehl’s group, Housing Opportunities Made Equal,(1) is back in court, this time challenging the Town of Boston’s rejection of a home for four developmentally disabled adults.
      HOME, the region’s largest fair housing organization, recently filed a federal lawsuit claiming the town discriminated against the disabled when it refused to issue a building permit for a new home at the corner of Cole and Omphalius roads.

      Town officials say they’re not opposed to group homes but have fought this project from Day One. The concerns range from where it might be built to who it might serve. One of the biggest fears is that it would house sex offenders.

      “Of the 1,600 people we serve, only seven are registered sex offenders,” said Mindy Cervoni, president of Community Services for the Developmentally Disabled, the Buffalo organization sponsoring the home.

      Cervoni said opposition to her group’s projects – it has 40 group homes across the region – is not unusual, but this is the first time Community Services had to file a lawsuit to enforce its right to build a new home.

      The suit followed a hearing last year into the town’s concerns and a subsequent decision from the state recommending the group home move forward. In her decision, the acting commissioner of the State Office for People with Developmental Disabilities said the town’s concerns, while important, were based on “speculation and conjecture.”
    For more, see Fair housing group sues Town of Boston over group homes.
    (1) Housing Opportunities Made Equal is a Buffalo-based fair housing organization providing comprehensive services for victims of housing discrimination throughout Western New York. These services include recording and investigation of reported incidents of discrimination, paralegal counseling, client advocacy to conciliate validated complaints, case preparation for legal action, and emotional support for victims and their families.

    NY AG Squeezes $3K From Landlord To Settle Allegations That Disabled Vet Was Refused Rental Apartment Because He Had Assistance Animal To Help Alleviate PTSD Symptoms

    From the Office of the New York Attorney General:
    • Attorney General Eric T. Schneiderman [] announced a settlement with Katherine and George Hubbell and their real estate holding companies to require them to immediately stop denying assistance animals to disabled tenants.

      “Service animals provide a level of comfort and security to individuals with disabilities, greatly improving their lives,” Attorney General Schneiderman said. “My office will continue fighting to defend the rights of New Yorkers with disabilities and enforce the laws that protect them.”

      The Attorney General received a complaint from a disabled veteran who suffers from post-traumatic stress disorder (PTSD) and has a dog to help alleviate some of the symptoms associated with PTSD. He sought to rent at the Northway Apartments on upper Margaret Street for himself and his assistance animal. He made it clear to Northway that he is disabled and needs the animal to help with the disability. Northway owner Katherine Hubbell responded, “We do not accept pets. Thank you for your interest,” and refused to rent to him.
      The AG’s agreement with the Hubbells and their companies requires them to adopt a written policy for accommodating the disabled, to instruct their staff about assistance animals, and to inform tenants and prospective tenants of their rights. The Hubbells must also pay to the Attorney General $3,000, up to half of which may be used by the AG to compensate individuals whose disabilities were not properly accommodated.
    Source: A.G. Schneiderman Announces Settlement To Require Plattsburgh Landlord To Allow Disabled Tenants To Keep Assistance Animals (Katherine And George Hubbell, Owners Of Northway Apartments Must Accommodate Disabled Individuals’ Assistance Animals; Pay $3K Fine).