Cuomo Seeks Damages for Victims and Protection for Tenants in Over 9,500 Apartments

NEW YORK, NY (January 28, 2010) – Attorney General Andrew M. Cuomo today announced his intent to sue Vantage Properties (“Vantage”), a major New York City landlord, to stop it from harassing tenants in rent-regulated apartments and to obtain monetary damages for tenants who have been victimized. The Attorney General has sent Vantage a five day notice letter, as required by statute, notifying the company of his intent to commence litigation against them.

Since March 2006, Vantage has purchased more than 125 buildings containing over 9,500 apartments – almost all of which are rent-regulated – throughout Queens, Harlem, and Upper Manhattan. The Attorney General’s legal action alleges that Vantage is taking action to force long-term, rent-regulated tenants to move out of their homes, and imposing significant rent increases on new tenants in order to increase profits. Vantage aggressively pressures long-term tenants by serving baseless legal notices and commencing frivolous Housing Court eviction proceedings.

“Landlords who illegally harass tenants to boost their bottom line do great harm to the fabric of this City,” said Attorney General Cuomo. “Their underhanded tactics displace long-time residents from their homes and exacerbate the acute affordable housing shortage. My office is committed to the preservation of affordable housing. We will continue to enforce the laws intended to protect tenants and bring unscrupulous landlords to justice.”

After purchasing a building, Vantage tries to evict some tenants by falsely claiming that they do not primarily live in their apartments or that they have failed to pay rent. Vantage’s actions are often based on information that is incorrect or information that Vantage should know is false. In some cases, Vantage refuses to cash rent payments from tenants, and then begins Housing Court eviction proceedings based on nonpayment of rent.

Vantage’s actual business plans refer to their strategy of removing tenants from rent-regulated apartments as the company’s “Golub program.” A Golub notice is a notice of intent not to renew a lease combined with a notice to terminate tenancy. Vantage makes specific targets for each building to determine how many residents they needed to remove to increase their profits. For example, Vantage’s 2008 business plan for a group of residential apartment buildings in the Washington Heights neighborhood of Manhattan states, “Our goal for fiscal year 2008 is to generate unit turnover through active management of the Golub program and other legal efforts… Our legal efforts are starting to bear fruit and rent prices continue to exceed plan, all contributing to what should be a strong year to come.”

Under New York City law, it is unlawful for a landlord or property owner to harass tenants. Specifically, landlords cannot interfere with or disturb the privacy, comfort, peace, or repose of quiet enjoyment of the tenant in his or her use or occupancy of the housing accommodation, or engage in harassing conduct intended to cause the tenant to vacate such housing accommodation.

Assemblymember Adriano Espaillat said, “Vantage has made it their business to harass residents right in their homes. But today’s action brings the fight to Vantage’s own front door. Thanks to the work of Attorney General Cuomo, Vantage will now have to face the consequences of their illegal practices.”

Senator Eric Schneiderman said, “New York residents should never be taken advantage of, especially not during an economic crisis. I applaud Attorney General Cuomo for protecting the rights of tenants by putting an end to this harassment. This legal action will put other lawbreaking landlords on notice that they will be held accountable for their illegal conduct.”

Assemblymember Jose Peralta said, “Vantage Properties has unjustly profited by causing great personal costs for their tenants and for our communities. The people who are victims of their schemes did not just lose their apartments – they lost their homes. The illegal actions carried out by Vantage have been a strain on our communities and I am glad to join with Attorney General Cuomo to put a stop to them.”

Manhattan Borough President Scott M. Stringer said, “Hard-working New Yorkers should always have a place in this City to call home, but landlords like Vantage never belong here. Attorney General Cuomo is taking this company to task for the abuses it has inflicted on long-term residents and I am happy to stand with him in this fight.”

David R. Jones, President of Community Service Society, said, “The legal action taken by the Attorney General is an important step to protecting vulnerable tenants in this City. Vantage is trying to reap profits that are only attainable by harassing hard working rent regulated tenants out of their apartments. Vantage’s investment scheme has the potential to inflict harm on New York residents of a magnitude not seen since the sub-prime mortgage crisis.”

Harvey Epstein, Director of the Community Development Project at the Urban Justice Center, said, “Vantage’s business plan and harassing tactics is gentrification in its worst form and impacts New York’s most vulnerable residents, recent immigrants and low income workers, the hardest. In these tough economic times, the preservation of affordable housing is of the utmost importance. I applaud Attorney General Cuomo for taking up the fight.”

Benjamin Dulchin, Executive Director of the Association of Neighborhood Housing Development, said, “Tenants and affordable housing across New York City are threatened as private-equity backed developers are purchasing a significant percentage of affordable, rent-regulated apartments. The Wall Street type level of competition and profit seeking of private equity financing is causing an epidemic of tenant harassment. Vantage and their financers are jeopardizing economic diversity and long-term stability of our neighborhoods. The Attorney General’s commencement of an enforcement action against Vantage puts landlords and their investors on notice that tenant harassment is against the law and violators will be sought out and brought to justice.”

This legal action is part of Attorney General Cuomo’s ongoing efforts to enforce laws that promote access to affordable housing for low and middle income New Yorkers. In June 2009, the Attorney General took legal action against Amerimod, a leading New York foreclosure rescue company, for charging illegal up-front fees and engaging in consumer fraud. In January 2009, the Attorney General reached a groundbreaking settlement over discriminatory practices, in which two mortgage brokerage companies – HCI Mortgage and Consumer One Mortgage – agreed to collectively pay $665,000 in restitution to approximately 455 Black and Latino borrowers who were illegally charged higher fees than similarly-situated White borrowers. At the time it was the first law enforcement action of its kind in New York State. In 2007, the Attorney General secured $1 million in restitution to approximately 270 Black and Latino borrowers who experienced discriminatory lending practices by GreenPoint Mortgage.

The case is being handled by Assistant Attorney General Brooke Davis under the supervision of Civil Rights Bureau Chief Alphonso B. David and Counsel for Civil Rights Spencer Freedman.