December 24, 2012
Albany, NY

Governor Cuomo Announces Subpoena Served on Landlord to Investigate Allegations of Harassment and Intimidation of Tenants in Northern Manhattan and the Bronx

Governor Cuomo Announces Subpoena Served on Landlord to Investigate Allegations of Harassment and Intimidation of Tenants in Northern Manhattan and the Bronx

Governor Andrew M. Cuomo announced today that the newly-formed Tenant Protection Unit (TPU) had served a major subpoena on Castellan Real Estate Partners/Liberty Place Property Management, an owner/manager of approximately 1,700 apartments -- in over 35 different buildings -- located mainly in Harlem, Washington Heights and the South Bronx. The subpoena focuses on the landlord's reported harassment and intimidation of mainly Spanish-speaking immigrant tenants in buildings recently purchased by the landlord.

"Landlords who harass tenants and engage in prejudiced bullying will not get away with it in this state, period," Governor Cuomo said. "We created the Tenant Protection Unit for exactly this purpose: to stand up for renters who are being taken advantage of by bad landlords. This investigation sends a clear message to any owner who tries to profit by preying on those who do not speak English or push tenants out of their homes with threats."

The charges that led to the investigation and subpoena include: failure to provide renewal leases; false fees on individuals rent statements when tenants have payment receipts; and sending tenants information sheets asking them to provide documents proving income, as well as citizenship status, all of which are illegal to do to existing leaseholders. In other cases, the owners staff is alleged to have personally threatened tenants, telling them they could face eviction because of their immigration status or lack of proof of adequate income. Tenants also detailed being pressured to accept inadequate buyouts to leave their rent-regulated homes and waive their rights through an English-only settlement document -- given to tenants who cannot read English.

"We know that most landlords of rent-regulated housing are good businesspeople, who know that little can be gained from heavy-handed and illegal efforts to turn over apartments and force tenants out," said Darryl C. Towns, Commissioner/CEO of New York State Homes and Community Renewal (HCR). "Today's work by the TPU sends a strong message to those landlords who are the exception that thanks to the Governor's leadership, they are being watched much more closely."

In addition to requesting the relevant rental documents, the subpoena also requests information on the landlords' business and investment practices based on their reported promises to investors of 15% profit returns through the purchase of rent-regulated buildings that they had described to investors as having been previously "mismanaged."

State Senator Adriano Espaillat, who serves as the ranking member of the Senate Housing, Construction and Community Development Committee, said, "Landlord harassment is driving tenants from their homes, and has hastened the loss of critical affordable housing. Castellan/ Liberty Place Managements predatory behavior towards low-income immigrants is reprehensible, and I am excited that we now have the Tenant Protection Unit to investigate this abuse. Governor Cuomos actions will help safeguard vulnerable New Yorkers throughout the city, and I thank him for standing up for rent-regulated tenants."

Assemblyman Keith Wright, Chair of the Assembly Housing Committee, said, "According to these very serious charges, the security and stability of more than 1,700 individuals and families were seriously endangered. I commend the Governor and the TPU for acting expeditiously to protect these tenants and to hold a landlord accountable for his bad acts. Let this be a message to landlords: you will have to answer for abusive and illegal behavior to tenants."

In preparing its enforcement action, the TPU's investigators worked with a local tenants' rights group and met with several of the tenants who provided documentation of the alleged harassment.

Juan Haro from Movement for Justice in El Barrio said, "These tenants are taking courageous action against those who would try to exploit Latino immigrant communities and some of our state's most vulnerable residents. We are very happy to work with the TPU on this case, and on other cases in the future that will bring justice to tenants."

Benjamin Dulchin from the Association for Neighborhood and Housing Development, Inc. (ANHD) said, "I thank the Governor for quickly activating the TPU, in trying to prevent the unlawful eviction of these tenants. Working together with tenants and the State, we can ensure that the stock of rent-regulated affordable housing isn't decimated by landlords who promise their investors high-returns in the short term by creating highly illegal vacancies. Landlords cannot willfully harass and intimidate tenants to drive them out and turn their apartments into market-rate units. Tenants' groups stand ready to work with the TPU to stop this kind of abuse."

Maggie Russell-Ciardi from Tenants & Neighbors said, "We applaud the Governor and the TPU for their proactive approach to investigating these tenants claims of harassment."

New York State's rent laws, strengthened in 2011, are designed to protect nearly one-million residents of rent-regulated housing. Created by Governor Cuomo in 2012, the TPU has begun proactively enforcing the state's rent laws -- and has gotten results. In its major activity, the TPU has conducted a random audit of building owners who failed to register their properties in the last four years as required by law. The TPU has also audited owners requesting proof of work done as part of apartment improvements that significantly raised rents, and had been used in the past to move units out of regulation. For the first time ever, subpoenas were sent to owners who failed to comply with the TPUs requests for the required proof of these apartment improvements. As a result of these actions, approximately 500 owners and 1,000 apartments have been audited and close to 2,000 buildings with 20,000 apartments have been re-registered and added back to the rent-stabilization rolls.