Thread: Kushner Companies routinely filed false paperwork with New York officials

Kushner Companies fined by city for falsified construction permits

The Department of Buildings cited 42 violations across 17 buildings

By Amy Plitt@plitter Aug 28, 2018, 10:16am EDT


Kushner Companies

The Department of Buildings has hit Kushner Companies with a $210,000 fine for falsifying information on construction permits, according to the New York Times. The move comes after multiple reports of the firm misrepresenting the status of rent-regulated units in several of its apartment buildings, in order to illegally perform construction work. The DOB cited 42 different violations across 17 buildings in Manhattan and Brooklyn.

Those buildings include five—89 Hicks Street, 18 Sidney Place (both in Brooklyn Heights), 331 East Ninth Street, and 170 and 174 East 2nd Street—where tenants have either highly publicized alleged tenant harassment, or brought legal action against Kushner Companies. The violations cited by the DOB are related to permits spanning a period of 2013 to 2016.

Multiple investigations (by the Housing Rights Initiative, among others) have found that Kushner Companies skirted New York’s rent-stabilization rules at these buildings (either by falsifying permits or not registering regulated apartments with the state), thereby making it easier to make renovations and take units out of rent regulation.

RELATED
Kushner Companies and tenant lawsuits: A brief history


In a statement provided to Curbed, a spokesperson for the DOB said that “Protecting tenants is a key part of our mission to make construction safe for all New Yorkers, and we are determined to hold landlords accountable for the accuracy of their applications—no matter who they are.”

Kushner Companies told the Times that “paperwork errors” are to blame for the false permits, and that “[i]n no case did the company act in disregard of the safety of our tenants.”

Just yesterday, HRI unveiled its latest investigation, which found that President Donald Trump’s personal lawyer, Michael Cohen, engaged in similar practices—falsifying construction permits and de-regulating rent-stabilized apartments—at three Manhattan buildings that he had previously owned.

https://ny.curbed.com/2018/8/28/1778...dob-violations

• Kushner Companies and Michael Cohen Accused of Falsifying Building Permits to Push Out Tenants [NYT]
• Trump lawyer Michael Cohen skirted rent-stabilization laws as a NYC landlord

A $10 million civil lawsuit. Okay, then a court and jury will figure it out.

Kushner Companies and Michael Cohen Accused of Falsifying Building Permits to Push Out Tenants


Tenant activists issued a report on Monday that suggested that an investment group led by Michael Cohen, the president’s former personal lawyer, had falsified construction permits by claiming that three buildings in Manhattan — one being 237 Henry Street — were vacant or without rent-regulated tenants, when they did have rent-protected residents.
CreditCreditJeenah Moon for The New York Times

By Charles V. Bagli

• Aug. 27, 2018

Charles Kushner, the developer whose son Jared Kushner is a senior adviser to President Trump, and Michael Cohen, the president’s former personal lawyer, face scrutiny in New York for claims that they falsified construction permits in an attempt to remove rent-regulated tenants from buildings scattered across the city.

On Monday, the city’s Department of Buildings cited Kushner Companies for 42 violations in which it submitted false permit information at 17 buildings, where many of the tenants were protected from steep rent increases and eviction.

The fines total $210,000.
A spokeswoman for Kushner Companies said Monday that the violations were “paperwork errors.” The company can contest the citations before an administrative judge. “In no case did the company act in disregard of the safety of our tenants,” said the spokeswoman, Christine Taylor.

Tenant activists also issued a report on Monday based on city and state records that suggested that an investment group led by Mr. Cohen had also falsified construction permits by claiming that three buildings in Manhattan were vacant or without rent-regulated tenants, when they were occupied and many tenants had rental protections.

Landlords are required in New York City to disclose whether tenants in their buildings are rent regulated to obtain a construction permit.

This requirement is designed to safeguard rent-regulated tenants from harassment. Unscrupulous landlords sometimes push out rent-protected tenants so they can sharply increase rents on those units.

Critics, however, complain that numerous violations slip through the cracks between the separate data systems used by city and state agencies.

At 172 Rivington Street, for example, the Cohen group indicated that there were no rent-regulated tenants in the 20-unit building, after the company purchased it in October 2011 for $2.1 million. But records indicated that there were 19 protected tenants there, but only 11 remained after the Cohen group sold the building three years later for $10 million.
Tenants living in Mr. Cohen’s buildings repeatedly filed complaints about noise and dust related to construction work, according to the report by Housing Rights Initiative, a nonprofit tenant advocacy group.

The Buildings Department said it had investigated 6 complaints at 172 Rivington Street and observed no violations of city construction rules there, or at a second building controlled by the Cohen group, according to a spokesman, Joseph Soldevere.

The Cohen group held the buildings for only a few years and then sold them for a combined $17 million profit.

Mr. Cohen did not respond to a request for comment.

The tenant group issued a similar report about the Kushners in the spring after sifting through public records from the Department of Buildings, the Finance Department and the state’s Homes and Community Renewal agency, which oversees rent-regulated tenants. Up until 2015, when the city and state agencies formed a Tenant Harassment Task Force, there had been little coordination among them.

Earlier this year, current and former tenants at 184 Kent Avenue in Brooklyn, a Kushner-owned residential building at the edge of the East River, sued the Kushner Companies in State Supreme Court claiming that they had been forced out by “loud and obnoxious drilling” and a “constant cloud of toxic smoke and dust.”

The number of rent-regulated tenants in the building plummeted to 71 in June from 316 in May 2015; the Kushner Companies are now selling condominium apartments in the building.

Neither Mr. Cohen nor the Kushner Companies have been cited for tenant harassment.

Aaron Carr, executive director of Housing Rights Initiative, said that the group’s analysis “suggests that Mr. Cohen had commenced a deliberate campaign to systematically harass tenants out of their apartments using destructive, hazardous and illegal construction practices, so he could dramatically raise rents.”

But the report also provides a “window into the dysfunction at city and state agencies,” he said.

“The Department of Buildings approved falsified permits,” he said, “despite receiving complaints from tenants in those very same buildings.”

Records indicate a steep decrease in the number of rent-regulated tenants in the buildings owned by Mr. Cohen and the Kushners.

But the city would not know whether some number of tenants were paid cash by the landlord to leave, a common practice used by building owners to empty apartments.

Mayor Bill de Blasio has built or preserved tens of thousands of apartments for low- and moderate- and middle-income tenants. Still, his administration has been unable to keep up with the loss of affordable housing as apartments leave the rent-regulation system.

Mr. Cohen purchased 237 Henry Street in the Lower East Side of Manhattan for $3.35 million in August 2013. Construction work in the building commenced almost immediately. The new owners claimed on permit applications that the building was vacant, although all 20 apartments in the building were occupied by rent-regulated tenants.

After the Cohen group sold the building for $9 million, records indicate there were five rent-regulated tenants left.

https://www.nytimes.com/2018/08/27/n...d-tenants.html

A building inspector is supposed to inspect the property upon receipt of the application and verify everything before construction starts. That's why you apply for a construction permit and also why you pay fees for those inspections. Why didn't the building inspector see that the building wasn't vacant, but occupied, if it was in fact, before he issued the permit?

Kushner Companies Loses a Key Motion in Class Action Filed by Baltimore Tenants

A state judge declined to dismiss the suit filed by apartment residents who claim they were charged inappropriate and excessive fees.

by Alec MacGillis
July 23, 4:42 p.m. EDT

A Maryland judge is allowing a class action lawsuit against Jared Kushner’s family real estate company to proceed, in a ruling that denies most of the company’s arguments to dismiss the case over its treatment of tenants at large apartment complexes in the Baltimore area.

The lawsuit, filed last September in the Circuit Court for Baltimore City, alleges that the Kushner Companies’ real estate management arm, Westminster Management, has been improperly inflating payments owed by tenants by charging them late fees that are often baseless and in excess of state laws limiting them to 5 percent of rent.

The suit also claims that Westminster was making some tenants pay so-called court fees that are not actually approved by any court.

The suit alleges that the late fees and court fees set in motion a vicious churning cycle in which rent payments are partly put toward the fees instead of the actual rent owed, thus deeming the tenant once again “late” on his or her rent payment, leading to yet more late fees and court fees.

Tenants are pressured to pay the snowballing bills with immediate threat of eviction, the suit alleges.

The lawsuit followed a May 2017 article co-published by ProPublica and The New York Times Magazine that described the highly aggressive legal tactics used by Kushner Companies to pursue tenants and former tenants at 15 apartment complexes in the Baltimore area.

The company’s motion to dismiss the lawsuit was heard on Wednesday by Barry Williams, the same judge who presided over the cases against the six police officers involved in the arrest and transport of Freddie Gray, the 25-year-old Baltimore man who suffered fatal injuries after being taken into custody in 2015. None of the six officers was convicted.

In his ruling, Williams denied the bulk of the company’s motion to dismiss the case, including its argument that too much time had passed since the events the suit described. Williams also rejected for now, deeming it premature, the company’s argument that each tenant’s situation is too unique for the group to constitute a single class.

Williams did grant a couple of points in the company’s motion. Most notably, he granted the company’s motion to dismiss the count of the lawsuit alleging that the company’s treatment of tenants represented a breach of contract.

Andrew Freeman, a lawyer representing the tenants, said dismissing the breach of contract count had little practical effect, given that this count provided no damages beyond what the tenants would recover under the separate claim that the company’s late fees exceeded state limits.



The Beleaguered Tenants of ‘Kushnerville’

Tenants in more than a dozen Baltimore-area rental complexes complain about a property owner who they say leaves their homes in disrepair, humiliates late-paying renters and often sues them when they try to move out. Few of them know that their landlord is the president’s son-in-law.



Freeman cheered the ruling overall. “We are very pleased that Judge Williams recognized that plaintiffs have a claim for a violation of Maryland’s laws that protect tenants from excessive late fees and forbid landlords from threatening tenants with eviction for those not paying those fees, and that he refused to dismiss our class action allegations,” he said.

“We look forward to proceeding with the case on behalf of the many hundreds, if not thousands, of Westminster Management’s tenants who have been victimized by those illegal fees.”

Michael Blumenfeld, a lawyer representing the Kushner Companies, said the company was pleased that Williams had limited the lawsuit on a few points, and indicated that the company still plans to challenge the assertion that the tenants make up a single class. “Kushner Companies looks forward to presenting these issues to the court soon,” he said. The company declined to comment on the merits of the lawsuit at the time it was filed, but did respond to questions about its tactics for the May 2017 article, saying that its approach to pursuing tenants was in line with industry practices and that it had a fiduciary duty to its partners to collect all money owed by current and former tenants.

The lawsuit now moves to the discovery stage. A hearing on the tenants’ claim to class certification could happen as soon as September.

In November, Kushner Companies and related corporate entities named in the suit sought to have the case transferred from state court to federal court, which would spare the company from having to face a jury drawn only from Baltimore. To prevail on such grounds, the company had to show that none of its ownership partners were Maryland residents. The company requested that its list of partners be sealed from view, citing the “politically-motivated innuendo” that could result from the high degree of media interest in Jared Kushner, President Donald Trump’s son-in-law and senior White House adviser, who has recused himself from a role in the family companies.

The request to shield the partners’ identities was challenged by ProPublica, the Baltimore Sun, the Washington Post, the Associated Press, and Baltimore TV station WMAR-TV. In January, a federal judge ruled against the request to seal the partners’ identities. As a result, the company opted to keep the case in state court after all.

Kushner Companies is also facing a separate lawsuit filed this month by tenants in New York, alleging a whole other set of behaviors in that much different real estate market: that it used harassing tactics to drive them out of their apartments in order to charge higher rent. The company has called that suit “totally without merit.”

https://www.propublica.org/article/k...timore-tenants

NYC fines unpaid by Kushner Cos.: Over $500K and counting

Could be they're in dispute or excessive. Happens all the time. But I love seeing concern for tenants who don't pay their rent on time or within the grace period and then sue over the late fees or who qualify for rent control (authoritarian socialism) and won't move at the end of their lease. That's so .... nice.

Kushner pays tenants $100K to cover for rent overcharges

Move comes amid class-action lawsuit alleging illegal deregulation at 89 Hicks Street

December 05, 2018 06:00PM

Kushner Companies agreed to pay five tenants at its Brooklyn property 89 Hicks Street a combined $100,000 to compensate them for alleged rent overcharges and for illegally deregulating their units.
The company is also returning the apartments to rent-regulated status, Crain’s reported. The move comes in response to a class-action lawsuit filed in April 2017 by tenants with the help of the nonprofit Housing Rights Initiative.
“Once the issue was brought to my client’s attention, it immediately and voluntarily acted in good faith to address the issue,” Rosenberg and Estis attorney Deborah Riegel, who represents Kushner in the case, told Crain’s. “Not only did my client make refunds to the existing tenants, and in some cases former tenants, but it also registered the units as rent stabilized. Rather than wait for an adjudication, as some owners have chosen to do, my client proceeded expeditiously to remedy the issues raised.”
Newman Ferrara’s Lucas Ferrara, who is representing the tenants, countered that Kushner deliberately deregulated the units. “Any landlord worth their salt knows whether the units in a building they’re buying are or should be regulated or not,” he said. “Kushner was aware of the risks and took a gamble that no one would notice what they were doing.”
Ferrara told Crain’s that the payouts won’t stop the lawsuit.

Kushner bought the former Brooklyn Law School dorm for $14.3 million in 2014.
Ferrara also represents tenants at 18 Sidney Place, which, like 89 Hicks Street, was a rent-stabilized building before Brooklyn Law School used it for dorms. The academic use of the property allowed the school temporary release from rent stabilization, but if the buildings returned to the market as rentals, they were required to be brought back under stabilization laws, according to the lawsuit. Kushner did not return the units to stabilization when it bought the building in 2014, the suit claims. [Crain’s] — Konrad Putzier

https://therealdeal.com/2018/12/05/k...t-overcharges/

Greed abounds.

I'd say the information being provided so far clearly identifies Jared Kushner as less than honest and very greedy at best. At worse, however, I'd say he is a flat out crook that should be behind bars!

Trump’s government shutdown threatens Jared Kushner’s subsidized rental housing