Saturday, October 15, 2016

Non-Profit Health & Housing Group Reaches Settlement Of Fair Housing, Other Claims In Lawsuit Centered Around City's Abrupt Changes In Zoning, Land Use Ordinances To Prevent Use Of Premises To Provide Aid To Homeless

In Yakima, Washington, the Yakima Herald-Republic reports:
  • Under a settlement agreement reached [last month], Yakima Neighborhood Health Services(1) will drop its federal lawsuit against the city of Yakima and instead submit a new application for using Roy’s Market as an apartment building to house local homeless people.

    The revised application, which Neighborhood Health must submit within 90 days, will be for an apartment facility in which up to 40 homeless people could stay for 30 days to two years — not for a temporary shelter.

    “We’ve agreed the facility will not be designed as a place of temporary sojourn, a mission or a warming shelter,” said Rich Hill, Neighborhood Health’s attorney in the lawsuit, which was filed in Superior Court in February and moved to federal district court in March.

    The settlement is a “positive step,” Hill said. “Neighborhood Health is excited to work with the city on obtaining approval for the proposal,” he said.

    The pressing issue of where to house Yakima’s homeless population has been in contention since the fall of 2014, when Neighborhood Health expressed interest in installing an emergency homeless shelter in the Roy’s Market site — to which the city responded by passing an emergency moratorium on new homeless shelters in “Small Convenience Center” (SCC) zones in Yakima.

    Though a city hearing examiner agreed with Neighborhood Health’s proposal, which included other social services besides the emergency shelter, the city appealed and ultimately denied the application. Neighborhood Health then sued the city in Superior Court to overturn the land-use decision; that suit remains on hold pending the outcome of the new application process.

    The separate federal-court suit dealt with Neighborhood Health’s allegations of Fair Housing Act violations and discrimination by the city in making certain zones off-limits for homeless shelters.

    Resolving that lawsuit rather than continuing to push it through the court system was in both parties’ interest, said Ken Harper, the city’s attorney on the case.

    “The litigation process is full of cost; it’s full of risk,” Harper said []. “Over the summer, as we had discussions in and outside the litigation setting, it became obvious that there was an opportunity to resolve this outside of litigation.”
    Rather than a shelter, the facility would be an apartment complex, likely with a variety of one- or two-bedroom units to accommodate families in need of housing.

    Neighborhood Health would be the landlord, and the individuals would be treated as normal tenants — likely with continued support and case-management services through Neighborhood Health programs.

    “The tenant has to behave themselves or they can’t stay in the unit,” [Neighborhood Health's board chairman Don] Hinman said. “We’re not going to turn anybody away, but we’re not going to allow any disruptive behavior, either.”
For more, see Lawsuit settlement could mean housing for Yakima’s homeless (Yakima Neighborhood Health Services plans to open a facility that would house up to 40 homeless people after it dropped a federal lawsuit against the city). zoning land use ordinance regulations
(1) Yakima Neighborhood Health Services is a private, non-profit housing & health care organization that provides comprehensive medical, dental , and behavioral health care at seven locations in Washington State's Yakima Valley; and also provides emergency shelter services, and permanent supportive housing locally for homeless individuals and families (including medical respite care).

HUD, Mississippi Municipality Reach Settlement In Fair Housing Lawsuit Accusing City Of Using "Agressive Code Enforcement Regime", Passing Lower Density Restrictions In Zoning, Land Use Ordinances In Attempt To 'Bleach' Minority-Populated Area Of Blacks, Latinos

In Ridgeland, Mississippi, the Jackson Free Press reports:
  • Just a few months after the U.S. Department of Housing and Urban Development filed a complaint against the City of Ridgeland for alleged violations of the Fair Housing Act, it announced a conciliatory agreement with that city []. In its Dec. 20, 2015, complaint, HUD alleged that Ridgeland's 2014 Comprehensive Zoning Ordinance engaged in "unlawful discrimination based on race in its ongoing 'amortization,' condemnation, and threatened removal" of five apartment complexes and the "rezoning of approximately nine."

    Suburban Ridgeland annexed its southeastern corner from the City of Jackson in 1981 and, from 1990 to 2010, saw its population of color drastically increase. HUD alleges in the complaint that Ridgeland has prioritized the redevelopment of that majority black area since 2006, with the mayor and board of aldermen selecting an all-white Community Awareness Committee for the purpose. Then, HUD says, the City implemented an "aggressive code enforcement regime" for those apartments in 2010. When that failed, Ridgeland adopted its 2014 Ordinance and largely blocked apartments' efforts to come up to code in another attempt to bleach the area.(1)
    The Mississippi Center for Justice, a legal advocacy group, in conjunction with legal group Venable LLP, also filed a complaint against the City of Ridgeland on behalf of the denizens of some of the apartment complexes in southeast Ridgeland this February, also for Fair Housing Act violations.

    "We're thrilled with the conciliation," John Jopling, managing attorney for the Mississippi Center for Justice, told the Jackson Free Press. "It really does vindicate the basics of our lawsuit, which is the Fair Housing Act and the disproportionate impact the zoning ordinance had on African American and Latino residents." Jopling says the Mississippi Center for Justice has to confer with its partners and clients over the future of the lawsuit.

    Among its responsibilities in the HUD settlement, Ridgeland must amend the 2014 Zoning Ordinance and appoint a fair housing compliance officer.
For more, see Ridgeland, HUD Reach Settlement in 'Shifting Demographics' Dispute.
(1) See HUD Announces Agreement With Ridgeland, Mississippi To Settle Discriminatory Zoning Complaint:
  • [I]n December of 2015, HUD filed a fair housing complaint against the city after receiving reports that a number of apartment complexes faced possible demolition after the city instituted a new zoning requirement that lowered the allowable density.

    Specifically, HUD complained the city’s new zoning ordinance called for several of the apartment complexes with the highest minority populations to be amortized, putting more than 1,400 units at risk of being replaced with mixed-use developments. HUD also alleged that other majority minority complexes were subjected to lower density restrictions, which could have resulted in a loss of hundreds of additional apartment units.

Another Landlord Gets Roped Into Housing Discrimination Lawsuit Over Alleged Denial To Allow Tenant's Request For Emotional Support Pooch; Complaint To Local Non-Profit Group Triggered Probe Utilizing Fair Housing Testers

In Pittsburgh, Pennsylvania, the Pittsburgh Post-Gazette reports:
  • A Bethel Park woman sued her landlord [], alleging that she was denied her right to an emotional support dog at a Shadyside complex, and was not fully accommodated when she moved to the suburbs.

    Victoria Immel, 22, suffers from general anxiety disorder and "requires the use of an emotional support dog to mitigate these symptoms, as prescribed by her licensed therapist," according to the lawsuit in U.S. District Court.

    From 2012 through early 2016, she lived in a Fifth Avenue building owned and managed by Amore Limited Partnership, Amore Management Co., and related firms, according to the complaint.

    In late 2015, Ms. Immel got an emotional support dog, but Amore refused to allow it in the apartment building, so it stayed with her mother in Ohio, she alleges. In June, she moved to the Lindenbrooke complex in Bethel Park, which allows pets, but the dog is still "prohibited from being with her in the common areas" there, according to the complaint.

    The Fair Housing Partnership of Greater Pittsburgh(1) sent test renters to Amore, which showed "that Amore’s corporate office ultimately does not grant reasonable accommodation requests for emotional support animals," according to the complaint. The partnership is a plaintiff in the case with Ms. Immel.

    Ms. Immel suffers "humiliation, embarrassment, emotional distress, anxiety, stress, and a deprivation of her right to equal housing opportunities," due to Amore's violations of the Fair Housing Act, the lawsuit alleges, demanding change to the company's policies, plus compensatory and punitive damages.

    Amore executives were not immediately available for comment Saturday.
Source: Bethel Park woman sues over landlord's dog policies.
(1) The Fair Housing Partnership Of Greater Pittsburgh is a nonprofit organization dedicated to the enforcement of fair housing laws in southwestern Pennsylvania through advocacy and comprehensive housing counseling services.

City Of Dubuque To Area Landlords: Beware Of Fair Housing Ambush Patrol On The Hunt For Prohibited Discrimination When Renting Apartments; Hunting Season To Begin Soon

In Dubuque, Iowa, the Telegarph Herald reports:
  • City of Dubuque officials hope data gathered during a series of upcoming landlord tests will expose any fair housing issues in the community.

    Rental property owners, however, consider the exercise an unnecessary inconvenience, according to Jerry Maro, president of Dubuque Area Landlords Association. “I think with our landlord association, everybody is pretty fair about renting their properties,” he said.

    City Council members [] signed off on a proposal from Fair Housing Center of Nebraska and Iowa to conduct the testing this fall. The organization will be paid up to $24,000 to evaluate how prospective tenants’ race or use of housing vouchers affects their renting experiences.

    The testing based on protected classes is “in furtherance” of objectives spelled out in a voluntary compliance agreement with the U.S. Department of Housing and Urban Development, according to a memo from Assistant City Attorney Crenna Brumwell.

    That agreement followed a 2013 report from the federal agency condemning the city’s administration of the Housing Choice Voucher program. HUD officials determined that black, out-of-state applicants were inordinately excluded from the program, also known as Section 8.
    Maro said landlords have been made aware of the impending study, but members of his association think the testing is a nuisance. “I guess, for most of us, basically it’s an inconvenience,” Maro said. “Because we’re answering a phone and we don’t know if it’s somebody looking for an apartment or if it’s somebody testing us.”
    The nonprofit center also will be paid $8,360 to evaluate rental housing on the basis of disability and the presence of companion or therapeutic animals, Brumwell said. “The reason for recommending that is people with physical or mental disabilities, the number is increasing,” she said.

HUD Issues Guidelines In Addressing Housing Discrimination Claims Based On Limited English Proficiency

From the U.S. Department of Housing & Urban Development (Washington, D.C.):
  • The U.S. Department of Housing and Urban Development (HUD) [] issued "Limited English Proficiency" (LEP) guidance that addresses how the Fair Housing Act would apply to claims of housing discrimination brought by people because they do not speak, read, or write English proficiently. More than 25 million people in the United States do not communicate proficiently in English. Read the new limited English proficiency guidance here.

    The Fair Housing Act prohibits both intentional housing discrimination and housing practices that have an unjustified discriminatory effect. People with limited English proficiency are not a protected class under the Fair Housing Act. However, the Fair Housing Act prohibits discrimination on seven protected bases, including national origin, which is closely linked to the ability to communicate proficiently in English.

    Housing providers are therefore prohibited from using limited English proficiency selectively or as an excuse for intentional housing discrimination. The law also prohibits landlords from using limited English proficiency in a way that causes an unjustified discriminatory effect.

    "Having a limited ability to speak English should never be a reason to be denied a home," said Gustavo Velasquez, HUD Assistant Secretary for Fair Housing and Equal Opportunity. "Every family that calls this nation home has the same rights when it comes to renting or buying a home, regardless of where they come from or language they speak."

    Nearly 9 percent of the U.S. population is limited in English proficiency. Approximately 16,350,000 (or 65 percent) of these individuals speak Spanish, while 1,660,000 (7 percent) speak Chinese, 850,000 (3 percent) speak Vietnamese, 620,000 (2 percent) speak Korean and 530,000 (2 percent) speak Tagalog. Housing decisions that are based on limited English proficiency may have a greater impact on these and other groups because of their nationality.

    The guidance addresses how various legal approaches, such as discriminatory effects and disparate treatment, apply in Fair Housing Act cases in which a housing-related decision – such as a landlord’s refusal to rent or renew a lease – involves a person’s limited ability to speak, read, write, or understand English.

    Discriminatory practices, for example, could include
  • applying a language-related requirement to people of certain races or nationalities;
  • posting advertisements that contain blanket statements, such as "all tenants must speak English;" or
  • immediately turning away applicants who are not fluent in English.
  • Targeting racial or national origin groups for scams related to housing also constitutes intentional discrimination.

Friday, October 14, 2016

Contractor Faces Felony Charges Of Theft By Deception, Receiving Advance Payments For Services & Failing To Perform For Pocketing $4K Deposit For Remodeling Work, Then Never Showing Up To Job Site

In Ferguson Township, Pennsylvania, the Centre Daily Times reports:
  • A Beaver Springs contractor is facing felony charges after allegedly taking a customer’s money but never performing any work.

    According to the criminal complaint filed by Ferguson Township police, a township resident wanted some remodeling work and was contacted by Charles Meredith, 32, of Serenity Contracting LLC, on July 28. The next day, Meredith and a helper came to the home to take measurements, allegedly telling the resident work could start the next week.

    Meredith allegedly gave a written work estimate to the resident on July 30, police said, estimating the cost of the work at about $7,100, and requested a $4,000 down payment. The resident allegedly gave Meredith a check for $4,000, which cleared on Aug. 2.

    Afterward, police said, the resident allegedly tried several times to make contact with Meredith to find out when work would begin. When Meredith would return calls, police said, he allegedly would make new promises and not show up.

    By late August, the resident allegedly began asking for his money back, police said. Meredith allegedly stated on Aug. 28 that he would return the money but didn’t show up.

    The resident sent a final email to Meredith on Aug. 30, police said, allegedly saying he was going to file a report with the police.

    Meredith was arraigned before District Judge Thomas Jordan on Sept. 23, court documents said, and was charged with felony counts of receiving advanced payment for services and failing to perform, theft by deception and receiving stolen property.

Dubious Contractor Finally Gets Pinched For Allegedly Stiffing Roofing Supplier Out Of Approx. $150K, Leaving 70 Central Florida Homeowners With Liens On Their Properties

In Pasco County, Florida, WTSP-TV Channel 10 reports:
  • "I’m glad he’s behind bars," said John Pfaff, who is out thousands of dollars detectives say because of John Iacovino.

    Iacovino is now facing felony extortion charges for at least 15 other victims and detectives say that’s not all. "Seventy properties had liens against them because of Ike’s Roofing," said Detective Darren Hill of the Pasco Sheriff's Office.(1)

    Pfaff said, "I feel bad for the other people because they’re probably never going to get the lien removed." Pfaff paid Ike’s Roofing $8,800 in cash after his roof was installed thinking the deal was over, but investigators say the Ike’s owner Iacovino never paid his bills.

    "Ike’s Roofing got the supplies on credit from Suncoast Roofing Supply then did the roofing jobs, but never paid Suncoast Roofing Supply for the materials," said Hill.

    And that’s how Pfaff ended up with a $3,700 lien against his home. "When I get older it’s going to hurt because this is my nest egg," Pfaff said.

    The sheriff’s office says make sure everything is resolved before making a final payment.

    "They received a final waiver of lien from all the subcontractors and suppliers because that’s what’s going to keep you from getting a lien put on your property," Hill said.

    Pfaff, who doesn’t work due to medical issues, had this to say about Iacovino. "Karma is going to get him," said Pfaff.

    Hill said, "He wasn’t paying attention to the bills and was kind of treating the money as his personal bank account." Hill says Iacovino has a history of drug and DUI arrests, and showed no remorse for his victims. "He seemed more upset with everyone else blaming everyone but himself," said Hill.

    Pfaff said, "I’m not going to give anybody my money anymore." Pfaff says done trusting contractors.

    The sheriff's office says Suncoast Roofers Supply is out around $150,000. 10News WTSP contacted the company, but it had no comment.

    If you've paid Ike's Roofing for a job and think you may be a victim contact the Pasco Sheriff' Office at (727) 847-5878.
Source: Sheriff: Roofing contractor skipped bills, left 70 victims.
(1) The Florida Homeowners' Construction Recovery Fund is a fund of last resort that might be available to qualified individuals [no business entities] who have suffered monetary damages by the financial mismanagement or misconduct of a contractor, and who has exhausted all other resources of payment. The Construction Industry Licensing Board makes the determination of eligibility for an award. For more:
But see, Action 9 investigates state recovery fund meant to help homeowners for a story on how some homeowners claimed they got the run-around from this fund. mechanics lien

Contractor Who Allegedly Fleeced Seven NJ Homeowners Out Of $75K Gets Bagged In Florida; Charged With Theft By Failure To Make Required Disposition Of Property Received

In Ocean County, New Jersey, the Asbury Park Press reports:
  • A Clearwater, Florida, contractor is under arrest for allegedly bilking $75,000 in personal savings, insurance payments and federally funded home-repair grants, according to Ocean County officials.

    The prosecutor's office's Economic Crimes Unit charged 63-year-old Richard Woodard, part owner of the now-defunct Willwood Builders, with theft by failure to make required disposition,(1) Ocean County Prosecutor Joseph D. Coronato said. Woodard allegedly defrauded seven homeowners.

    In addition to taking his would-be clients' savings and insurance money, he also accepted payment in the form of state-administered Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) grants.

    The federally funded grants are meant to bridge the gap between insurance payments and the true cost of rebuilding storm-resistant homes.

    Willwood Builders never finished the work its clients had paid for, according to the announcement.

    Officers from the Pinellas County Sheriff's Office arrested Woodard on Friar Tuck Lane in Dunedin, Florida, on Sept. 21, according to the announcement. Florida authorities held him on a $150,000 bail as Ocean County arranges for his extradition.
For the story, see Florida contractor charged with Ocean Co. ripoffs.
(1) 2C:20-9, New Jersey Revised Statutes. Theft by failure to make required disposition of property received.

A person who purposely obtains or retains property upon agreement or subject to a known legal obligation to make specified payment or other disposition, whether from such property or its proceeds or from his own property to be reserved in equivalent amount, is guilty of theft if he deals with the property obtained as his own and fails to make the required payment or disposition. The foregoing applies notwithstanding that it may be impossible to identify particular property as belonging to the victim at the time of the actor's failure to make the required payment or disposition. [...]

Thursday, October 13, 2016

Charged With 65 Felonies, Real Estate Agent Accused Of Pilfering $250K In Loan Modification Scam Abandons "Bad Businessman" Defense, Cops Plea To Two Charges; Will Get Easy Jail Sentence (No More Than 1 Year) In Exchange For Probable Prison Time-Buy Out Deal; Victims Express Outrage

In Sonoma County, California, The Press Democrat reports:
  • A Petaluma real estate agent accused of defrauding dozens of clients across the Bay Area in an alleged home mortgage scam settled his case with state prosecutors [] with an agreement to serve up to a year in jail.

    Miguel Angel Lopez-Soleta, 44, pleaded no contest to felony grand theft and embezzlement from an elderly person through his Rohnert Park business, Mortgage Modifiers, in 2012.

    In addition to possible jail time, Lopez-Soleta will receive five years of probation and be ordered to pay restitution at his Dec. 1 sentencing hearing. Prosecutors agreed to dismiss the 63 remaining charges.

    Former clients who claimed they were ripped off by Lopez-Soleta expressed outrage at what they said was a light punishment. Robert Gillis, who said his mother lost her Novato home to foreclosure because of Lopez-Soleta, said he should have received 20 years in prison.

    “It’s totally unacceptable,” said Gillis, who is part of an email group with 100 people who lost money on the alleged scam. “None of the victims agree with it. They are so upset.”

    Caroline S. Chen, the deputy attorney general handling the case, did not return a call [] seeking comment. She told Judge Robert LaForge she would seek additional restitution in the amount of $147,000 for two people and other victims not named in the complaint. Lopez-Soleta has already agreed to pay about $100,000.

    A spokeswoman for Attorney General Kamala D. Harris said it is common to drop charges when a defendant accepts responsibility and pays restitution.

    His lawyer, Kristin Long, said her client had valid defenses to many of the claims but accepted the plea bargain to avoid the risk of a long prison term.

    He could be allowed to serve jail time any jail sentence on electronic home confinement or work release, she said. He appeared in court [] and remains free on bail.

    Last year, Lopez-Soleta was charged with 65 felonies accusing him of bilking clients out of about $250,000.(1)
For more, see Plea deal for Petaluma real estate agent accused in Bay Area home mortgage scam.
(1) In a June, 2015 story, his then-attorney characterized this case as nothing more than a civil matter, not a crime:
  • Lopez-Soleta declined to comment but his lawyer, Stephen Turer, called the case against him a “witch hunt.” Turer said Sonoma and Marin county prosecutors have already declined to bring charges in what he characterized as a civil contract dispute. It is unclear why the state Attorney General’s Office is now taking up the case, he said.

    He’s a bad businessman,” Turer said. “There’s a big difference between being a bad businessman and being a criminal.”

Federal Jury Convicts Loan Modification Scammer Of Fleecing Foreclosure-Facing Homeowners Out Of $1.5+ Million; Affinity Racket Specifically Targeted Members Of Vietnamese Community

From the Office of the U.S. Attorney (Santa Ana, California):
  • An Orange County man who deceived distressed homeowners with false promises that he could help them avoid foreclosure by obtaining modifications to their mortgages – or even completely eliminating their loans – was convicted [] on federal fraud charges.

    Antonio Marquette, who went by “Alan Le” and “Anthony Le,” 56, of Midway City, was convicted [] in United States District Court in Santa Ana of nine counts of mail fraud, one count of wire fraud, and one count of money laundering. Marquette was taken into custody after the verdicts were taken, and United States District Judge Andrew J. Guilford set the sentencing hearing for January 30, 2017, at which time Marquette will face a statutory maximum sentence of 220 years.

    According to evidence at trial, Marquette operated Bolsa Marketing Group in Garden Grove in 2010 and 2011 and charged homeowners up to $100,000 in cash for services that the homeowners did not receive. Through Bolsa Marketing, Marquette ran a scheme that targeted distressed homeowners, most of whom were members of Vietnamese communities in Southern California, the Bay Area and Houston, and induced them to pay large up-front fees to obtain mortgage relief services.
    The evidence showed that Marquette operated the scheme by “falsely promising homeowners mortgage loan modifications that would substantially reduce their mortgage payments, avoid foreclosure, or eliminate their mortgage loans entirely.” The trial evidence further showed that Marquette took in more than $1.5 million from victim-homeowners.

    As part of the scheme, Marquette made various promises to homeowners, including making guarantees that he could reduce their outstanding debt to 25 percent of the loan balance in only four months. Marquette also sent fraudulent checks to “pay off” mortgages and filed bogus documents with county recorders’ offices, according to court documents.

    “The defendant operated this affinity scheme by targeting Vietnamese homeowners with false promises via Vietnamese-language radio advertisements, which added a veneer of legitimacy to his scheme,” said Deirdre Fike the Assistant Director in Charge of the FBI’s Los Angeles Field Office.

NJ Man Cops Guilty Plea To Theft By Deception, Gets 3 Years For Running Loan Modification Scam That Pilfered $131K From Multiple Financially Strapped Homeowners

In Mount Holly, New Jersey, the Burlington County Times reports:
  • Victims duped by a Mount Laurel man who promised them financial services and instead kept $131,000 of their money for his own use told a judge [] they do not think three years in prison is enough punishment.

    Scott D. Feltman, 42, of Starboard Way, was sentenced by Superior Court Judge Christopher Garrenger at the Burlington County Courthouse in Mount Holly after pleading guilty earlier this year to second-degree theft by deception.

    Feltman admitted using his Mount Laurel company to take about $131,000 from about 75 victims to perform loan modifications and other financial services but keeping the money for himself.
    About 10 victims addressed Garrenger, telling him that Feltman "talked a good talk," made promises he never kept, represented himself to be something he wasn't and, in many cases, stole from them when they were vulnerable and in need.

    The victims spoke of losing up to about $12,000 to Feltman, their homes in some cases, and their faith and trust in people. Some said they have suffered from stress and emotional issues. One called Feltman "despicable" for taking advantage of people who were trying to save their homes or having other financial issues.
    Many of the victims were not happy that Feltman received three years and that he will possibly be accepted into the state's intensive supervision program, which provides an opportunity for certain offenders to work their way back into the community under intensive supervision instead of being incarcerated.

    If accepted into the program, Feltman could possibly be released from prison in months. [...] Feltman was sentenced according to the terms of a plea deal reached between the state and defense.

    Feltman's attorney, Samuel Asbell, argued that the quicker Feltman gets out, the sooner he can get a job to pay back the $131,000 in restitution. Many of the victims said they fear they will never get all their money back.

    The victims were from New Jersey and Pennsylvania and are owed amounts that range from a few hundred dollars to as much as about $15,000, authorities said.

    Feltman was operating under the company Baymar Capital Funding LLC, according to court documents. He has a previous conviction for drugs in 1998 and criminal usury in 2011, according to court records. His attorney could not be reached for comment.

    Feltman has a pending charge of theft by deception charge in Camden County, according Burlington County Assistant Prosecutor Andrew McDonnell.

Operators Of Another Loan Modification Racket Avoid Criminal Prosecution; Court Judgment In Feds' Civil Lawsuit Bans Scammers From Peddling Future Debt Relief Services, Ordered To Give Back $1.7 Million Fleeced From Duped Homeowners

The Federal Trade Commission recently announced:
  • The operators of an alleged mortgage relief scam that preyed upon distressed homeowners are banned from the mortgage loan modification and debt relief business under a court order obtained by the Federal Trade Commission.

    The order stems from a case the FTC brought in July 2014 against five defendants as part of a federal-state law enforcement effort called Operation Mis-Modification. According to the FTC, the defendants, operating under the fictitious names “2Apply” and “UW Solutions,” falsely claimed they could lower consumers’ mortgage payments and interest rates or prevent foreclosure, pretended to be affiliated with a government agency or consumers’ lenders or servicers, and illegally charged advance fees – an initial $495, plus monthly fees that averaged about $399.

    In granting the FTC’s request for summary judgment against Tuan Dinh Duong, the court found that Duong knew about the false claims and directed the illegal scheme, which violated the FTC Act and the Mortgage Assistance Relief Services (MARS) Rule. The court also entered default judgment against four co-defendants.

    Under the final orders, the defendants are banned from selling secured or unsecured debt relief products or services, and prohibited from making material misrepresentations about any financial or other products or services. The orders impose a judgment of more than $1.7 million, which represents the amount of money consumers lost.

Wednesday, October 12, 2016

Study: Battle Creek Real Estate Agents Prefer White Prospective Homebuyers Over Better-Qualified Black Counterparts; Fair Housing Testers Strike Again

In Battle Creek, Michigan, the Battle Creek Enquirer reports:
  • White prospective homeowners received better treatment and service from Battle Creek real estate agents than their black counterparts who were "better-qualified consumers," according to a fair housing investigation conducted last fiscal year.

    The findings, released Thursday [Sept. 29] at a news conference held at Battle Creek City Hall, reported that among 38 tests, white subjects were offered more listings, received better communication and had fewer discussions on pre-approval requirements. That's despite black test subjects being assigned characteristics that would give them an advantage, such as better financial situations.
    While the city has conducted previous fair housing studies, often required by the U.S. Department of Housing and Urban Development because of federal funding, it contracted with the Kalamazoo-based Fair Housing Center of Southwest Michigan for $25,000 to take "a larger-scale approach" after hearing concerns during public engagement efforts over the past couple years.

    The investigations focused on real estate agents and race discrimination, individual landlord investors and race discrimination and companion animal acceptance.

    The tests "are structured in such a way to grant black testers the advantage in an effort to target discriminatory behavior," according to the investigation.

    Agents were more likely to follow up with white testers, and black testers "had to try five times harder to receive correspondence or correct information."
    The investigation also discovered a lack of understanding about laws related to persons with disabilities who have a companion animal. Ten of 28 agents denied housing after disclosure of a disability status, half of which were due to a no-pet policy.

    It found "no clear patterns" related to landlord investors and race discrimination — testers in general received poor treatment and were shown rental units in poor condition. Fourteen advertised but uncertified rental units were discovered during the investigation. They have been reported to the city's code compliance department.

Different Company Name, Same BS; Loan Servicer To Cough Up $1.4 Million To Settle State AG's Lawsuit Alleging It Called Overdue Borrowers More Than Twice/Week, Failing To Verify Debts Before Commencing Foreclosure, Both In Violation Of Massachusetts Law

In Boston, Massachusetts, The Boston Globe reports:
  • Following a series of debt collection lawsuits and settlements, including one announced [last month] by Attorney General Maura Healey, consumer advocates are calling for tighter state regulations over the industry.

    On Wednesday [Sept. 28], Healey’s office announced that a Florida mortgage company agreed to pay the state $1.4 million to settle allegations it violated Massachusetts debt collection laws, including calling overdue borrowers as many as 12 times a day.

    Ditech Financial LLC tried to collect on more than 5,000 delinquent Massachusetts mortgage accounts since 2012 using tactics that violated state law, including calling borrowers as many as 12 times a day, Healey said.
    “It is big-volume business right now,” said Margaret Miley, an adviser for the Midas Collaborative, an Allston-based network of community groups. “There needs to be more done to regulate this growing industry.”

    Healey’s office and officials with the Division of Banks are debating whether to further regulate the industry and held their first hearing on the issue earlier this month.

    Healey’s settlement with Ditech will probably fuel that discussion.

    Healey described Ditech’s practices as “abusive” and said the company’s calls to borrowers exceeded the two calls a week allowed by state law.

    Homeowners also went into foreclosure without receiving the appropriate and timely information about their debt, Healey alleged.(1)
    Ditech, which used to be known as Green Tree Servicing LLC, was not immediately available for comment. Green Tree had its own share of regulatory problems. In April 2015, Green Tree paid $63 million in fines and restitution after the federal Consumer Financial Protection Agency and the Federal Trade Commission said the company failed to honor prior loan modifications, demanded payments before notifying borrowers of their options, and made false threats and repeated calls to borrowers who had fallen behind.
For the story, see Advocates seek more limits on debt collectors.
(1) According to the Massachusetts Attorney General's office:
  • [T]he AG’s Office also found that Ditech failed to notify borrowers of their right to seek detailed information regarding their mortgage debt. Under state law, mortgage borrowers have the right to verify the amounts owed on a debt in collection and to confirm that the party seeking to collect on the debt has the legal right to do so.

    Particularly where mortgage loans are frequently transferred from servicer to servicer and sold from party to party, state law protects the rights of consumers to access information relating to their debt. Ditech’s alleged failure to issue required debt validation notices deprived consumers of their rights and their opportunity to seek information regarding their own mortgage loans.
See National Company Pays $1.4 Million, Strengthens Policies over Abusive Debt Collection Practices (Conduct Allegedly Affected More than 5,000 Accounts in Massachusetts; Allegations Include Making High Volume Collection Calls, Failure to Provide Debt Validation Notices).

Tuesday, October 11, 2016

Title Insurance Agency Owner Helps Cops Sting Pair For Allegedly Using Forged Deed, Phony Cashier's Check In Failed Attempt To Fleece Him Out Of $95K

In Jeffersontown, Kentucky, WLKY-TV Channel 32 reports:
  • The owner of a business with offices in Jeffersontown and New Albany said he almost got ripped off for nearly $100,000. The elaborate scam involved the sale of property located in St. Matthews.

    Two arrests have been made.

    According to investigators, a forged property deed and a forged cashier's check were keys to the scam.

    “Two people purportedly came into our office to transfer a piece of property for approximately $95,000,” Mike Kemp, of Kemp Title Company, said.

    One posed as a seller, the other as a buyer, Kemp said. They showed up at his Jeffersontown office to close the deal on a piece of St. Matthews property located near Seneca Park. “I think the facts will ultimately prove this current owner of the property didn't know that this deed was recorded,” Kemp said.

    Kemp said that from what he's learned, the quit claim deed is a forgery, but that's not all. “So they bring a cashier's check for the full sale's price. There was no lender involved,” Kemp said.

    The two men left for a couple of hours while Kemp's attorney verified the check was a phony. Jeffersontown police were called. Officers were stationed inside and outside the parking lot.

    So if we accept that cashier's check, which we know ultimately would be dishonored by 5th/3rd, we would have dispersed money in the amount of $95,000,” Kemp said.

    Instead of possibly losing thousands of dollars, when the men returned to the office, they were arrested.

    Daivion Walker, 26, and Kenneth Foster, 60, both of Detroit, are charged with two counts of forgery and theft.

    “Ninety-five thousand dollars is a big hit to take. I'm not saying it would have put us out of business, but many companies like me, that could easily put us out of business,” Kemp said.

    Both men remain behind bars.

    Police are looking for more suspects.

    Kemp said he feels fortunate, because a competitor of his was recently forced to shut down after falling victim to an email scam.

Crackpot Who Openly Admits Using Forged Documents To Hijack Title To Homes Now On The Loose In SW Florida; Cops Investigating

In Cape Coral, Florida, WINK News reports:
  • A family from Indiana thought they had found their perfect Florida home and were ready to move in… until a realtor realized it had been in the hands of Lemroyal James.

    “We were elated at the idea that this would be able to be our home,” said Paul Irminger, a husband and father of four who was looking forward to his family’s move into their new Coral Lakes Home.

    The property had been foreclosed by Wells Fargo bank, but he knew it would make a beautiful home for his new baby and three other young children. But then Irminger received a concerning call from his realtor.

    “I heard from the realtor and she told me ‘We have a situation,'” he said.

    That situation was Lemroyal James.

    James is what some, like real estate attorney Jeff Rice, would call a fraud — a total conman. That’s because James admits to claiming the titles of foreclosed homes that he does not own.

    “Whoever has done this has gone and checked the foreclosure files and has sought foreclosed properties,” Rice said. “This is a fraud.”

    But that’s not how James sees it. He said he is trying to prove a point to banks, who he said required a bailout and shouldn’t own the titles to homes.

    “I did it because it was a message to be sent,” James said. “Banks have no say so because we bailed you out.”
    What James is doing is what title examiners call a “wild deed.” [...] James said he is fighting a civil rights battle. He created the Civil Rights Banking Commission, which he continues use to claim titles on homes he believes banks can’t legally own.

    “My intentions are never fraud. My intentions are the law say I can do this, so let’s go to court,” James said. “That’s all I ask, let’s go to court. If you want your property, come to court.”
    The Cape Coral Police Department is investigating Lemroyal James for selling [] two vacant and foreclosed Lee County homes.

    His interview with WINK News was in a foreclosed home in Orlando.

    It was furnished.

    “You see the house where you are at? Same thing happened. Fannie Mae owns it. Well, Fannie Mae don’t own it. You do the history, Fannie Mae don’t own this property. But I’m here,” James said.

    James was arrested in 2003 in Orange County for burglary. He claimed he owned the home at the time because he successfully filed for a quit claim deed. James was also arrested in 2015 for filing false statements and fraudulent documents, which is a felony. Investigators said he filed claims on dozens of homes in Georgia and James could face up to five years in prison.

Monday, October 10, 2016

Highly Motivated To Be A Homeowner, Novice Homebuyer Falls For Predatory Rent-To-Own Racket; Transaction Informalities Suck Victim Into 'Built-To-Fail' Deal, Now Faces Eviction From Barely-Habitable Money Pit After Shelling Out Upfront Cash, Monthly Payments, Fix-Up Costs

In Dravosburg, Pennsylvania, the Pittsburgh Post-Gazette reports:
  • Erlean Hall had always wanted to own her own home.

    So when she saw a sign advertising rent-to-own homes and called the listed phone number, she was happy to hear about how she might be able to purchase one.

    “I always wanted to own,” said Ms. Hall, who cleans houses for a living. “That’s anybody’s dream. It doesn’t matter what your situation is. It’s something that you want of yours, something that you want to pass down to your kids.”

    After calling the number on the sign, Ms. Hall said she was directed to a website for Vision Property Management where she could look at homes for sale. She was encouraged to use her tax refund money as a down payment, and was told she would not need to go through a credit check.

    “I said, ‘That’s good, because my credit’s not that great.’ ”

    Advocates say Ms. Hall’s is a textbook example of a situation that has ensnared many financially unsophisticated would-be homeowners without access to traditional mortgage lenders.

    Several of the homes she initially looked at were in poor condition, but Ms. Hall held out hope that if she kept looking she could find a house she could fix up and live in with her two children.

    Vision’s website bills it as “the country’s largest provider of affordable Lease-to-Own property opportunities.” The company “take[s] great pride in creating an available inventory of affordable homes for individuals and families that may not currently qualify for conventional property purchases due to various employment, health, divorce or other financial reasons.”

    When Ms. Hall found a house in Dravosburg, it seemed like what she was looking for — there was a small area in the dining room that appeared to have water damage, but it otherwise the house appeared to be in good condition, she said.

    She was excited to see that it had a garage, so she would not have to park her car on the street.

    “I called them and said, ‘I really like this house.’ He said, ‘It’s first- come, first-served … . If you’re interested, I’m going to email you these papers. Hurry up and get it notarized and filled out because somebody else could take it.’ So it’s like this rush.”

    After quickly getting the required paperwork filled out and notarized, she signed an agreement last year. With a $1,370 down payment, along with her monthly payments, Ms. Hall believed she would own the two-bedroom home — which was listed at $48,000, according to court documents — at the end of seven years.

    But only a small fraction of Ms. Hall’s $420 monthly rent — $33.63 — would be counted toward that, the agreement she signed states. That means at the end of seven years, she would have paid only about $2,800 toward the purchase price. At the end of seven years, she can give up the home, or must pay off the balance either through a cash sale or some type of financing.

    Allegheny County real estate records show that RVFM 11 SERIES LLC, the legal entity tied to Vision taking Ms. Hall to court, paid $10,590 for the property in 2014.

    Installment land contract?

    Ms. Hall’s attorney, Eileen Yacknin, argues that while the agreement Ms. Hall signed was labeled a “residential lease with option to purchase,” the agreement was really an installment land contract [aka contract for deed].

    A recent report from the National Consumer Law Center about such contracts(1) noted that they are “marked by
  • grossly unequal bargaining power and access to information between the buyers and sellers,
  • the steep financial costs imposed on buyers throughout the transaction,
  • the fundamental unfairness of forfeiture clauses,
  • limited or no regulation in most states, and
  • a lack of access to affordable legal assistance to enforce what few legal protections exist.”
  • Such transactions often put the burden of major repairs on the would-be-homeowner, can have an inflated price and are often “disguised as lease-purchase” agreements, the report notes. Additionally, these types of deals tend to have a disproportionate impact on black communities, where fewer people have access to traditional bank loans, according to the report.

    The deals combine the worst aspects of home ownership -— being responsible for major repairs — with renting — vulnerability to eviction — without the legal protections of either.

    “The important thing is these [types of deals] are built to fail,” said Sarah Bolling Mancini, staff attorney with National Consumer Law Center and one of the authors of a report about such deals. “The sellers make more money if the buyer does not succeed,” because they end up churning multiple people through the property, with various tenants paying to make repairs.

    Jonathan Weaver, a housing counselor at the Mon Valley Initiative who counsels first-time home buyers, said he hears from people about once or twice a month who are interested in rent-to-own homes. They often have bad credit or another issue that would keep them from qualifying for a conventional loan. Mr. Weaver said he understands these agreements can seem attractive to renters who want to buy a home.

    “I do want to caution them, and tell them how scared it makes me, based on previous cases I've seen,” he said.

    Early problems

    Ms. Hall, thinking she was becoming a homeowner, was not deterred by early signs that there might be serious problems with the house. “The water guy comes in, and he says, ‘You know your pipes are stripped?’ ” she recalled.

    Copper piping had been stolen from the home before she could move in. Additionally, a key sewage disposal pipe was substantially damaged, so water could not flow upstairs.

    Ms. Hall said she searched to find a plumber whom she could pay in installments when she got paid every two weeks. Then she paid hundreds of dollars in plumbing costs to get the water flowing and make the home livable.

    “I was like, ‘That's OK, because this is my home. This is my home. I’m going to be here,’ ” she said. She put a plastic bag up to catch the leak in the dining room and made do.

    But over the summer, out of work due to a car breakdown, she fell behind in her rent, though she was still making payments to Vision, she said.

    Ms. Hall was dismayed when, with no notice or warning, she received court papers in August saying she had to leave the house -— an “ejectment.”

    Her attorney argues that because the agreement Ms. Hall signed was really an installment land contract, she should be protected by state law covering those types of deals -— which would entitle Ms. Hall to written notice of termination of her agreement.

    Furthermore, her attorney argues, if the court finds Ms. Hall signed a residential lease, then she is entitled to live in a habitable home, one with running water, a roof that doesn’t leak and a functioning hot water heater — Ms. Hall’s broke in June, and she and her children have been without hot water since then.

    Rent-to-own deals or land installment contracts have fewer protections for buyers than a traditional mortgage, said Ms. Mancini, one of the authors of the National Consumer Law Center report. For instance, there is no required third-party inspection — one that would have noticed Ms. Hall’s stripped pipes — or independent appraisal as there would be with a mortgage transaction.

    Not an isolated case

    “This is not an isolated instance,” she said. “It is typical that these [homes] are in bad shape, and the person is told, ‘You are becoming a homeowner, you have the obligation to make repairs.’”

    These types of deals have been around for a long time but have gone from what had been more of a mom-and-pop practice to one backed by bigger companies turning around large numbers of foreclosed properties, Ms. Mancini said.

    “Now, we are seeing this with financial backing. That is the recent trend,” she said.

    A spokesman for Vision declined to say how many of the company’s agreements result in the tenant ultimately purchasing the home, saying it is company policy not to disclose proprietary information.

    “It’s important to note that we don’t want our customers to fail,” said a statement from Vision. “Before we go into an agreement with any individual, we spend as much time as they need, going through the agreement and its implications in great detail. An unsuccessful transaction is costly to everyone, including us. We go to great lengths to help our customers.”

    It’s unclear how often these types of deals happen, according to the report, which cites 2009 census data showing 3.5 million Americans buying a home through a land contract at that time.

    “But this number likely understates the prevalence of land contracts, as many contract buyers do not understand the nature of their transaction sufficiently to report it,” the report noted.

    Vision’s website lists properties for sale in Pittsburgh, Braddock, McKeesport, Glassport, Duquesne, Carnegie, Wilkinsburg and elsewhere in Allegheny County.

    Allegheny County records show six properties owned by RVFM 11 SERIES LLC but show dozens owned by other other limited liability companies tied to Vision.

    The National Consumer Law Center’s report recommended that such transactions be regulated by the federal Consumer Financial Protection Bureau, the agency created in the wake of the 2008 financial crisis.

    Despite her experience, Ms. Hall said she wishes to remain in the home if she can work out an agreement through the court system.

    I’ve invested in this home. I’ve invested. And I've been through a lot in this home now,” she said.

    She added, “I considered myself a homeowner. But now … I guess I’m back to where I was.”

After $30K In Payments, Detroit Mom Finishes Paying Off Home Purchased On Land Contract Only To Find Out Seller Lacked Title To Premises

In Detroit, Michigan, WXYZ-TV Channel 47 reports:
  • A Detroit mom is furious and feels like she has been scammed after learning the house she bought on land contract is owned by the Detroit Land Bank Authority.

    Corey Parker paid nearly $30,000 to Detroit Property Exchange for a house on Detroit’s west side.

    The mother of four made her last payment in 2013 and got the deed to the home. Now she is learning, she doesn’t own the home.

    The Detroit Land Bank Authority does.

    According to records, the property was turned over to the Detroit Land Bank Authority from the City of Detroit, which obtained the property through a foreclosure in 2004.

    Parker learned she wasn’t the property owner after being contacted by the Detroit Land Bank Authority. She tells 7 Action News when she tried to clear up the confusion with Detroit Property Exchange, her calls went unreturned.

    7 Action News paid a visit to the company’s Midtown location and spoke with Christian Segura, who said he is the sales manager.

    Segura told us at the file and try to get to the bottom of the problem, which could take until Friday. He called the 7 Action News room shortly before our story aired and told us, ""We found the file, reviewed it and Ms. Parker paid the property off on March 1st, 2013. The deed was issued to her on March 29th, 2013. After that she satisfied the land contract and our obligations to her ended at that point. We also pulled up on public records, and show that city of Detroit took possession of the home after that, sometime between then (meaning March) and December. The deed issued to Ms. Parker was recorded on January 30th. 2015."

    When asked if Detroit Property Exchange would return Parker’s money if they did indeed sell someone a property they didn’t own, Segura said, “that would make sense.”

    The Detroit Land Bank Authority is also working with Parker to keep her in her home.

Move It Or Lose It: Booted From Mobile Home Park For Inability To Pay Space Rent, Lot-Leasing Homeowner Faces Loss Of Her 2-Bedroom Single Wide; Unable To Relocate It, Can't Find Buyer

In Corvallis, Oregon, the Corvallis Gazette-Times reports:
  • After 22 years in the Summerset Village Mobile Home Park in south Corvallis, Shelly Moothart got evicted this summer when she was no longer able to pay her space rent.

    She owns her mobile home, a 1990 two-bedroom Fleetwood single-wide, but if she can’t find a buyer in a hurry, she stands to lose that as well. She paid $21,000 for it originally and sunk another $10,000 into improvements a few years ago, but now she may have to walk away without getting a penny of her investment back.

    “I just don’t know what I’m going to do,” said Moothart, 58. “I have no money, no nothing.”

    Moothart was financially stable until about four years ago, when health issues forced her to take time off from her job as a legal secretary at a local law firm to have heart surgery. By the time she was ready to come back to work, she said, she was told her services were no longer needed.

    “I haven’t been able to find a full-time job since,” she said. “I started working at 15, worked all my life, and now nobody wants to hire old people.”
    But the eviction, it seems, was only the beginning of Moothart’s troubles.

    No place to go

    For most renters, getting evicted means having to find a new apartment. But when a mobile home owner gets the boot, it means having to find a new park to move their manufactured dwelling to.

    That can be a daunting prospect. For one thing, moving a mobile home can cost thousands of dollars — money Moothart simply doesn’t have.

    But in her case, there’s another hurdle as well — the structure’s age.

    A lot of parks won’t take an older home like this one,” she said.

    When she knew she was being evicted, Moothart put her mobile home up for sale at an asking price of $15,000. She thought she had a buyer at one point, but the sale fell through.

    Then, after she vacated the premises, the park managers changed the locks, so she can no longer show the place. [Landlord attorney Joel] Kalberer said the park wants to help Moothart sell the property to a paying tenant, but the management is not going to simply give her a key.

    “We would allow her to show it to prospective buyers,” he said, “but we can’t just let her take possession of the mobile home again.”

    Running out of time

    Meanwhile, the clock is ticking on Moothart’s chances to sell her home.

    In early August she received a letter from another attorney, Charles M. Greeff of Lake Oswego, informing her that Summerset Village intended to begin abandonment proceedings on her mobile home. The letter gave her 45 days — until 9 a.m. on Sept. 22 — to arrange for the mobile home’s removal. If the Fleetwood was still there 30 days after that, the letter said, the park managers would have the right to sell or dispose of the unit themselves.

    Can they do that? Under Oregon law, they probably can, according to Ken Pryor of Oregon Housing and Community Services.

    “The statutes aren’t particularly forgiving,” Pryor said. “It’s really unfortunate … but it certainly appears to be legal.”

    According to the Benton County Assessor’s Office, the mobile home’s current market value is about $15,500. Of course, there’s no guarantee the unit would fetch that much at auction.

    If Summerset Village does sell the mobile home through the abandonment process, Moothart won’t get all the proceeds. There will be deductions for back rent and storage fees on the home as well as the cost of the abandonment process and the sale itself. Unpaid property taxes will also be taken out, along with any lienholders’ interest in the property.

    And if no one buys the mobile home at auction, the park will have the option of demolishing the unit to free up the space for another mobile home. In that case, Moothart could wind up with nothing at all.

    Awaiting her fate

    Moothart said she tried to get help from Legal Aid, but an attorney with the nonprofit organization told her there was probably nothing he could do to prevent the park from selling her mobile home.

    Now all she can do is wait.

    She’s been living with a friend since her eviction, but she doesn’t want to be a burden any longer than necessary. At this point, she’s just hoping there will be enough money left after the sale of her home to get a fresh start.

    “I can’t do a whole lot until I sell the place, get a little money and hopefully get into some low-income housing,” she said. “It’s just sad.”

    Moothart is still more than a little shocked by the turn her life has taken.

    She can’t believe the law doesn’t provide more protection for mobile home owners who find themselves facing eviction, and she’s asking her elected officials to do something about it. She recently wrote a letter to state Rep. Dan Rayfield, D-Corvallis, and is hoping he’ll be able to get a measure passed in the next legislative session.

    “I don’t want anybody else to have to go through this,” she said. “It’s not fun at all.”
For more, see Move it or lose it.

Sunday, October 09, 2016

NYC Lawmakers Sound Alarm On Residential Property Owners Throughout City Using Airbnb To Turn Homes Into Tourist Flophouses; Short-Stay Landlords Often Cram Over A Dozen Guests Into Dangerous "Rentals Of Doom"

In New York City, DNAInfo (New York) reports:
  • Dangerously large groups of people are being crammed into "rentals of doom" through Airbnb across the city, according to a report by state Sen. Jeff Klein and the Independent Democratic Conference.

    The investigation, entitled "Tourist Tenements in the Making," focuses on Airbnb advertisements for short-term lodging in New York City where hosts say they can accommodate 13 guests or more, which forces them to put beds in places like kitchens and laundry rooms, according to Klein's office.

    “This truly is a case of Airbnb and the rentals of doom," Klein said in a statement. "It’s frightening to see listings where guests are offered dangerous accommodations that violate state and city housing codes."

    The investigation found 110 hosts throughout the city who offered up their places for groups of 13 or more people and accommodated them by lining up air mattresses on kitchen floors, putting beds in laundry rooms and putting bunk beds in a dining room.

    It also found that 91 of the 110 rentals advertised themselves as spots for overnight stays, while the rest promoted themselves as venues for parties and movie sets.

    A majority of the posts said their rentals could accommodate 16 people or more, while one said it could fit 32, and although such postings try to make their spaces look inviting, they actually put people in danger and represent potentially devastating fire hazards, according to the report.

    "Putting 16 or more tourists in a unit designed for a couple of families is a recipe for tragedy," the investigation reads.

    Most ads were found in Brooklyn, followed by Manhattan, Queens and The Bronx, Klein's office said.

    Cramming tourists into kitchens lined with air mattresses or lining up beds next to washers and dryers is nonsensical," State Sen. Diane Savino said in a statement. "It might be a cheap way to stay in New York City, but it certainly isn’t legal or safe."

    The report claims that these rentals violate the state's Multiple Dwelling Law and the city's Housing Maintenance Code, and the Independent Democratic Conference plans to introduce two pieces of legislation in response to its safety concerns.

California Appeals Court Nixes San Francisco's Latest Effort To Protect Tenants Against Ellis Act Evictions; Ordinance Improperly "Prevents Landowners From Exercising Their Right To Simply Go Out Of Business": Judge

In San Francisco, California, the San Francisco Chronicle reports:
  • A state appeals court [last month] rejected San Francisco’s latest attempt to restrict tenant evictions under the state’s Ellis Act, an ordinance requiring landlords to wait 10 years before merging rental units into one residence that they could sell as a single-family home.

    The Ellis Act, backed by the real estate industry and passed in 1985, allows property owners who decide to go out of the rental business to evict their tenants. Cities intent on preserving their supply of rental housing have tried to set conditions on landlords — a previous San Francisco ordinance, struck down by the courts in 2004, would have required the owner of a residential hotel to provide replacement housing, or pay a fee to the city, before evicting all tenants.

    The city’s latest ordinance, sponsored by Supervisor John Avalos and enacted in December 2013, would bar owners from merging units within a building for at least 10 years after evicting tenants who have not violated any rules or done anything else to provoke their departure.

    Most no-fault evictions are based on the Ellis Act, and the court noted that a common reason for merging tenant units is to convert a multiunit rental building into a marketable single-family structure. Another reason is to convert a duplex to a home for the landlord’s family.

    In a suit by the San Francisco Apartment Association and allied groups, Superior Court Judge James Robertson struck down the city ordinance in December 2014, saying it conflicted with the Ellis Act by penalizing property owners who were within their rights under the state law. [Last month], the First District Court of Appeal in San Francisco agreed.

    San Francisco’s measure “prevents landowners from exercising their right to simply go out of business,” Justice Martin Jenkins said in the 3-0 ruling.

    A city can restrict housing demolitions and take other steps to regulate land use and maintain its housing stock, Jenkins said. But he said the San Francisco ordinance was intended to “discourage or penalize Ellis Act evictions,” and cited language in the text of the ordinance that said it would “create a disincentive to evict.”

    Although the city “may have been motivated in part by the worthy goal of preserving the stock of affordable housing,” Jenkins said, its ordinance amounts to “local intrusion” into a subject the state has chosen to regulate, a landlord’s right to evict tenants in order to withdraw from the rental housing market.

Study: Sloppy Paperwork, Failure To Give Proper Notice, Non-Compliance With Licensing Ordinances Infect 1 Out Of 6 Default Judgments Obtained By Maryland Landlords In Tenant Eviction Actions

In Baltimore, Maryland, The Baltimore Sun reports:
  • Landlords in the state have won cases in rent court despite failing to properly document claims, serve legal notice on tenants or prove that they are licensed to rent properties, according to a study released [] by Maryland Legal Aid.

    The organization, which provides free legal services to the poor, documented such errors in more than 17 percent of cases in which landlords won default judgments against tenants for failure to pay rent. Because those landlords didn't follow the law, the group said, they shouldn't have won in court.

    Once landlords receive a failure-to-pay judgment, they can proceed to file an order of eviction.

    Legal Aid called for better verification of landlord complaint forms, arguing that eviction can start a cascade of devastating consequences — from adults losing jobs because they can no longer get to them, to children missing class time or having to switch schools, to families suffering physical and mental health problems from being displaced.

    "Housing plays such an integral role in a person's life that the loss of that housing, for any reason, can have an enormous negative ripple effect not only on the person involved, but also on his/her family and the community at large," the report said.

    Problems with rent court tend to disproportionately strike those who are low-income or otherwise disadvantaged or vulnerable, such as the disabled and victims of domestic abuse, Legal Aid said.

    Among the most disturbing findings, Legal Aid officials said, was that in 8.5 percent of cases, tenants had not received proper notice they were being taken to court. A failure to appear generally results in a default judgment in favor of the landlord.

    "Proper service — the most basic tenet of due process, affording adequate notice of legal claims and a meaningful opportunity to be heard — was not provided to tenants in accordance with Maryland law," the study said. "Default judgments were, nonetheless, entered against the tenants."

    Legal Aid launched the study as part of the Human Rights Project at American University's Washington College of Law.

    The study was based on a random sample — 1,380 of the estimated 614,735 failure-to-pay rent cases heard statewide in 2012. Researchers reviewed court documents and listened to audio recordings of the hearings.

Landlord With Dubious History For Dishonest Conduct In Hot Water Again As Local Prosecutor Seeks Larceny By False Pretenses Charges For Allegedly Charging Rental Applicants For Background Checks With No Intention Of Leasing To Them

In Wyoming, Michigan, WOOD-TV Channel 8 reports:
  • A Wyoming landlady is accused of taking advantage of potential renters by charging them for background checks with no intention of leasing to them.

    Wyoming’s city attorney confirmed to Target 8 that he’s seeking three counts of larceny by false pretenses against Angela Arvizu, 39, of Manchester Road SW.

    “Housing is hard enough as it is,” said Renee Reese, who contacted police and Target 8 to report Arvizu’s alleged rental ruse.
    She wasn’t alone. Alexis Cline, 19, was also struggling to get a straight answer from Arvizu after touring the house on Manchester. “She showed me the house,” explained Cline. “She had me give her 40 bucks for the application fee.”

    Cline said it looked like someone was in the process of moving out, so she believed the house would be vacant soon. But then she had trouble getting back in touch with Arvizu.

    “I kind of gave up hope and I was actually scrolling down Facebook and I seen somebody else post her picture and I kind of was like, ‘Hey, she did the same thing to me,'” Cline said.

    Ultimately, Reese, Cline and two other apartment hunters called police to complain that Arvizu was collecting application fees and failing to follow up.
    Wyoming police refused to tell Target 8 whether they found evidence that Arvizu conducted the checks because the case is still open. But the city attorney is seeking the criminal charges.

    Target 8 discovered Arvizu is wanted on a felony welfare fraud warrant as well.

    She also previously pleaded guilty to shoplifting previously and admitted to writing bad checks.

Section 8 Tenant Gets Pinched For Allegedly Scoring $115K In Rental & Utility Assistance Payments While Failing To Disclose That She Owned Two Homes & Had Cash In Two Bank Accounts

In Delaware County, Pennsylvania, The Delaware County Daily Times reports:
  • A Ridley Township woman who owned two homes and had cash in two bank accounts that she failed to disclose on her annual housing and utility assistance forms has been charged with felony theft and related offenses.

    Rakeema Harris, 41, of the 100 block of Ladomus Avenue, was preliminarily arraigned Sept. 14, when she was released on $25,000 unsecured bail.
    Harris, according to the affidavit of probable cause, was on the Housing Choice Voucher Program [Section 8] receiving Housing Assistance Payments (HAP) and Utility Reimbursement Payments (URP) through the Delaware County Housing Authority since April 2009. From May 1, 2009 through July 15, 2015, she received $111,266 from HAP and $4,552 from URP – payments totaling $115,778.

    Her benefits were terminated on July 31, 2015, “for failure to give true and complete information on her personal declaration form,” a form required to be completed each year, the affidavit states.

    According to the affidavit, Harris purchased a property in Philadelphia in July 2012 and a property in Ridley Township in January 2015 – properties she never disclosed on the forms.
    In addition to theft by deception and theft by unlawful taking offenses, Harris is charged with receiving stolen property and tampering with public records.