August 20, 2014
Albany, NY

Governor Cuomo Announces Subpoena Served on Manhattan Landlord Accused of Preying on Rent-Regulated Tenants

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Governor Andrew M. Cuomo today announced that New York State's Tenant Protection Unit has served a subpoena on Marolda Properties as part of an investigation into allegations of tenant harassment in Lower Manhattan. The broad-based subpoena examines the patterns and practices of Marolda; accusations of tenant harassment and allegations of trying to exploit Asian-American tenants by forcing them out of their rent-regulated apartments. 

 

No New Yorker should be forced to live in fear of harassment by their landlord, and today we are taking an action that will help protect thousands of New Yorkers from this kind of abuse, Governor Cuomo said. This case is especially egregious because it appears this landlord preys on many tenants who are elderly and whose primary language is not English which will not be tolerated in New York State. The Tenant Protection Unit was created to protect residents from landlords who try to defy the states rent laws, and my administration will continue investigating cases of possible abuse like this one to ensure that they are brought to justice.

 

Marolda is a large New York City landlord which owns and manages over 70 buildings with approximately 1,700 apartments throughout the five boroughs and Westchester County. The company has owned properties in New York City for several decades and recently expanded their holdings, purchasing a large number of buildings in Chinatown and throughout the Lower East Side. According to tenants' accounts, Marolda has engaged in a pattern of unlawful and abusive behavior to drive tenants out of their homes, including: denying basic services, refusing to renew leases as required by the state's rent laws, bringing groundless eviction proceedings, and pressuring tenants to accept low buyout offers.

 

Darryl C. Towns, Commissioner/CEO of New York State Homes and Community Renewal, said, "Today's announcement demonstrates that the Tenant Protection Unit continues to be vigilant and actively engaged in rooting out landlord fraud and bullying tactics. Thanks to the Governor and the Tenant Protection Unit, landlords who are trying to abuse the system will not be able to evict tenants at will, without any merit to their unreasonable claims. Though most landlords work hard to abide by the law, we must protect tenants from those bad actors who try to take advantage of vulnerable tenants."

 

Coordinating with tenants' and tenant advocates, including the Committee against Anti-Asian Violence Organizing Asian Communities, MFY Legal Services, Asian Americans for Equality, University Settlement, and the Cooper Square Committee, the Tenant Protection Unit interviewed tenants who had been told that they were in violation of their leases because their primary residency was elsewhere, without any factual basis. Using common surnames as a basis to tie a tenant to another address, Marolda allegedly targeted individuals and families for eviction, though they have lived exclusively in their apartments for decades. 

 

In one case, the preliminary investigation revealed that Marolda refused to renew a tenant's lease, threatening to evict a woman in her mid-eighties claiming that she had not been seen at the building and was not a resident there. Marolda's claim of the senior's non-residency was belied by clear evidence that she is a legitimate and active member of a community senior center and local religious organization, and has lived in the apartment for over 40 years. 

 

In another similar case, Marolda summoned a family to housing court to claim that the family's primary residency was elsewhere, despite the fact that the family has lived in the apartment for decades, has young children attending a neighborhood school, and has no links to another address.

 

Assembly Speaker Sheldon Silver said, Protecting rent regulated tenants and preserving affordable housing in our Chinatown and Lower East Side communities has always been a top priority for me. We will not tolerate harassment or threats against any tenants and the intimidation and targeting of Asian Americans is completely unacceptable. Many of our seniors, as well as working families, have been able to remain in their neighborhoods because of our crucial rent protections. We in the Legislature have successfully fought to strengthen and defend rent laws year after year and todays announcement is a crucial part of that fight. I want to commend Governor Cuomo and the Tenant Protection Unit for their efforts on behalf of vulnerable tenants throughout our state.

 

Senator Daniel Squadron said, "One of Chinatown and the Lower East Side's greatest challenges is affordability. And when landlords like Marolda use harassment tactics to drive out rent-regulated tenants, we have to do whatever we can to ensure this is stopped. I applaud Governor Cuomo, the Tenant Protection Unit, and tenants and advocacy groups like the Committee Against Anti-Asian Violence, the Cooper Square Committee, MFY Legal Services, Asian Americans for Equality, and University Settlement for working to address tenants' experience of harassment by Marolda. This pattern has to stop."

 

City Council Member Margaret Chin said, "We are proud to work with tenants, other community groups and the Governor to ensure that this landlord is held accountable for its actions. We have heard the tenants' terrible stories and are glad that the Tenant Protection Unit has taken steps to help them and preserve this community."

 

Michael Grinthal, the Supervising Attorney at MFY Legal Services, Inc. said, "MFY welcomes partnerships with proactive government enforcement agencies, such as the Governor's Tennant Protection Unit. The TPU's actions will greatly assist our efforts and embolden tenants to stand-up for their rights."

 

Cathy Dang, the Executive Director of the Committee against Anti-Asian Violence Organizing Asian Communities, said, "It is unconscionable that Fred Marolda would try to drive out a tenant in her mid-eighties, whose entire social structure is limited to the five or so blocks surrounding her building, from her home of over 40 years. Marolda's actions fly in the face of the history of Chinatown and the Lower East Side, communities built by immigrants and communities sustained by affordable housing that contribute to the unique culture of New York City. Thank you, Tenant Protection Unit, for intervening."

 

The Tenant Protection Unit was created by Governor Cuomo in 2012. Since its inception, the Units investigators, auditors and attorneys have recaptured more than 32,000 units that landlords had failed to register, restoring them to rent regulation, saving the State hundreds of millions of dollars in rehabilitation and reconstruction costs.

 

Since its creation, the Unit has also:

 

  • Audited landlords' claims for Individual Apartment Improvements, requiring itemized bills to substantiate the real costs of any improvement, as these added improvements can be used to raise an apartment's rent over the $2,500 rent threshold, allowing it to exit regulation.
  • Initiated audits which resulted in restoring more than $600,000 in overcharges to tenants who did not know they were paying more than required by the Rent Laws.
  • Announced an historic settlement in January 2014 against a landlord who was harassing and intimidating limited English speaking proficiency tenants in Upper Manhattan.
  • Assisted New York State Homes and Community Renewal in the eligibility determination of potential landlords for entitlement to state loans/grants/tax credits, by investigating and vetting a potential landlord's financial soundness and mortgage holdings for signs of overleveraging within their portfolios or allegations of increased tenant turnover through harassment.
  • Collaborated with various City agencies to form a joint task force to address the deregulation and destruction of rent-regulated apartments in North Brooklyn and other neighborhoods throughout the City.
  • Implemented new rent regulations, at the beginning of 2014, to support the new rent laws, by: clarifying how apartment improvements are calculated and verified; raising the deregulation rent threshold; raising the income threshold; and limiting vacancy bonuses to only one per year, reducing the ability of a landlord to move tenants in and out of a unit several times a year, with the sole purpose of adding vacancy bonuses that could move units past the $2,500 deregulation threshold.

 

The Units actions, along with the strengthening of the rent laws in 2011 by Governor Cuomo, have turned the deregulation tide, with far fewer units now leaving the system. Combined with the New York State Homes and Community Renewal-subsidized construction of 6,000 rent-regulated units since 2011, the number of rent-regulated units in New York State is now growing.

 

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