‘Bernie Madoff of landlords’ gets one year in jail

Steve Croman

By Kyle Campbell

One of the cityʼs most notorious landlords has been jailed for a year in a rare move by State Attorney General Eric Schneiderman to sound a warning bell to unscrupulous New York building owners.

Steven Croman, who has been dubbed “The Bernie Madoff of Landlords,” was sentenced to one year at Rikers Island on Tuesday after pleading guilty to grand larceny and tax fraud.

Croman was also fined $5 million in a plea deal that saw him admit to third-degree grand larceny, first-degree falsifying business records and fourth-degree criminal tax fraud.

Between 2012 and 2014, Croman acquired $45 million in refinancing loans by submitting applications with phony rent rolls that showed market rate rents for units held by rent-stabilized tenants. He also inflated commercial rent payments to pad his on-paper profits and obtain larger loans, according to Schneiderman.

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Hoylman hopes to unmask LLCs

State Senator Brad Hoylman

By Sabina Mollot

State Senator Brad Hoylman is hoping to shine some light into the shadowy world of limited liability corporations which, under current New York law, do not have to provide names or addresses of their owners when the companies are registered. Because of the mysterious nature of LLCs, they can be used to give seemingly endless campaign contributions as well as hide illegal activities like tax evasion and money laundering. To combat the money laundering issue, which has also been linked to terror funding, legislation has already been introduced at the federal level by Congress Member Carolyn Maloney, and Hoylman said his own bill is modeled after that one.

Hoylman’s legislation, announced, on Monday, would:

  • Make it mandatory for LLCs organized in New York or that do business in the state to disclose who their owners as well as provide a current residential or business address
  • Require the creation and maintenance of a publicly available database of those LLCs and their owners
  • Impose penalties that range from ten thousand dollars in fines to three years in prison for LLC owners who knowingly provide false, incomplete or outdated information.

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City Council takes aim at bullying landlords

Council Member Helen Rosenthal has proposed opening an Office of tenant Advocate. (Photos by Sabina Mollot)

By Sabina Mollot

Last Wednesday, the City Council overwhelmingly passed a set of bills that’s been dubbed the Stand for Tenant Safety Act. The legislation aims to crack down on acts of harassment by unscrupulous landlords by increasing penalties and making it easier for tenants to prove they’re being harassed, including when the behavior comes in the form of construction. Other bills call for the creation of a task force as well as a new office to help tenants cut through red tape.

That bill, sponsored by Helen Rosenthal, would create an “Office of Tenant Advocate” within the Department of Buildings.

“While many at DOB do important work on behalf of tenants, the bureaucracy just isn’t in place to make tenants’ voices heard,” Rosenthal said. “This bill will change that, giving tenants a dedicated watchdog and workhorse on their behalf.”

The bill to create a task force is aimed at evaluating current practices used by city agencies with regards to renovation and construction at residential buildings. Dan Garodnick, who sponsored this bill, said the task force would then come up with ideas to improve communication between the agencies, including the DOB, the Department of Housing Preservation and Development and the mayor’s office.

“Construction harassment is a lesser known but deeply troubling form of harassment,” Garodnick said. “We are determined to deliver effective and consistent strategies to help combat this practice.”

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Council votes to support low-income tenants’ right to counsel

Council Member Vanessa Gibson, Speaker Melissa Mark-Viverito and Council Member Mark Levine at the vote on the legislation (Photo via Mark Levine’s Twitter page)

By Sabina Mollot

On Thursday, the City Council voted overwhelmingly to support the right of tenants facing eviction to access free legal representation. In support were 42 Council members with three opposed and one abstention.

The mayor has already indicated his support for the bill, which was sponsored by Council Members Mark Levine and Vanessa Gibson. The legislation, introduced in 2014, has since been pushed along by the Right to Counsel NYC Coalition, which is made up of dozens of civic, tenant and legal assistance organizations.

The legislation likely took three years to get voted on due to the cost, which is estimated at $155 million a year. That figure is based on $93 million to be added to city money that’s already budgeted for similar services, around $62 million, according to Andrew Scherer, the policy director of Impact Center for Public Interest Law at New York Law School, who’s been deeply involved in the coalition’s efforts. Continue reading

Council bills take aim at tenant buyout offers

Council Member Dan Garodnick (Photo by Sabina Mollot)

Council Member Dan Garodnick (Photo by Sabina Mollot)

By Maria Rocha-Buschel

The City Council voted to pass a package of legislation meant to protect rent stabilized tenants from landlord harassment last Thursday. The three bills, one of which was sponsored by Council Member Dan Garodnick, are all specifically related to tenants’ rights when owners offer residents money to vacate their apartment, known as a “buyout.”

“We introduced this bill last year to deal with the specific problem of harassment by tenant relocation specialists,” Garodnick said. “There is nothing governing these interactions between tenants and owners. I think what these bills do is take unscrupulous acts by those who are looking to drive tenants out of their apartments and call them what they are, simply harassments. We are defining the rules of engagement, of how tenants can be approached in this context.”

The bill sponsored by Garodnick would amend the Housing Maintenance Code’s definition of harassment to make it unlawful for a landlord, in connection with a buyout offer, to threaten, intimidate or use profane or obscene language, contact tenants at odd hours or with such a frequency that the behavior would be considered abusive, to contact tenants at their place of employment without prior written consent and to knowingly falsify or misrepresent information provided to the tenant.

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East 13th St. tenants accusing landlord of harassment

Residents demonstrated outside their building last Thursday to protest aggressive buyout tactics and other ways they say the landlord is harassing them. (Photos by Maria Rocha-Buschel)

Residents demonstrated outside their building last Thursday to protest aggressive buyout tactics and other ways they say the landlord is harassing them. (Photos by Maria Rocha-Buschel)

By Maria Rocha-Buschel

Residents at 444 East 13th Street have been without cooking gas and hot water for over a month, but, as the rent-stabilized tenants in the building said during a protest on Thursday, that’s not their only concern.

The problems with their gas, they said, are just one of many that tenants see as harassment aimed at driving them out of their long-time homes.

Stephanie Rudolph, an attorney with the Urban Justice Center, represents the tenants and filed a lawsuit on their behalf last Friday, also requesting – and getting — an injunction, which prohibits any contact by the owners.

There are currently nine apartments in the building that are occupied out of 15 and Raphael Toledano, who bought the building at the beginning of this year, has been using relocation specialists who’ve been offering tenants buyouts from $30,000 to $60,000.

Rudolph had also previously sent the management company a cease and desist order on May 15, telling them to stop contacting tenants about surrendering their apartments and she said that not long after, tenants were showered with gifts from the management company with an apology about the lack of gas in the building.

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Legislation takes aim at ‘tenant relocation’ goons hired by owners

Council Member Dan Garodnick discusses new legislation inspired by complaints from Stuyvesant Town residents about lack of notice for inspections and non-emergency work in their apartments. (Photo by Sabina Mollot)

Council Member Dan Garodnick, pictured with Stuyvesant Town tenants at a press conference last week (Photo by Sabina Mollot)

By Maria Rocha-Buschel

Rent stabilized tenants often feel they’re at the mercy of landlords who would, if given the opportunity, replace them with someone paying market rate. Contributing to that fear in some cases that have recently attracted some media attention are specialists who are hired by owners and have used what local elected officials are calling unscrupulous tactics to get tenants to leave, with no regulations on their practices.

In an attempt to protect tenants from aggressive buy-out offers or other efforts aimed at intimidation, Councilmember Dan Garodnick introduced a bill at the end of February that would impose certain restrictions on these so-called “tenant relocation specialists.”

“Tenants need to be able to feel safe and secure in their homes and that is impossible if they’re being pursued relentlessly by someone whose job is to get them out,” Garodnick said. “They’ve used harassment, false offers and intimidation to remove tenants who are usually rent stabilized so that owners can financially benefit.”

The bill outlines a number of rules that these specialists would have to follow, including licensing and taking an exam to make sure they are knowledgeable about the rules and laws.

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Mendez bill would make illegal hotels a form of tenant harassment

Councilmember Rose Mendez (Photo by Sabina Mollot)

Councilmember Rose Mendez (Photo by Sabina Mollot)

By Maria Rocha-Buschel

Councilmembers Rosie Mendez and Rory Lancman announced legislation last Thursday to crack down on tenant harassment from illegal hotel conversions.

“(Short-term renters) are coming in at all hours, bringing people they meet into the apartment and it’s then impacting the quality of life, in that there are strangers in their building,” Mendez said. “It’s a breach of peace and quiet in your home because of the noise and people traffic.”

She noted that in a hotel, guests can call down to the concierge if there’s noise in the hallways late at night and the hotel can take care of the problem.

But in an apartment building without a live-in super that’s been turned into an illegal hotel, the solution isn’t quite so simple.

“When tenants call the landlord, they’re not going to reach them at 2 a.m.,” she said. “And if it’s the owner who’s renting it out, they may not follow up with the complaint.”

Whether the noise is due to someone renting from a building tenant or the landlord, if the landlord does not address the problem, this legislation would make the act of illegally renting out apartments a form of harassment and would allow tenants to sue the landlord.

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