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Thursday, March 28, 2024 | Back issues
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Kushner Apartment Firm Accused of Ripping Off Maryland Renters

Maryland’s Democratic attorney general filed an administrative complaint Wednesday accusing an apartment management company owned by President Donald Trump’s adviser and son-in-law Jared Kushner of overcharging tenants and leasing them rodent-infested units.

BALTIMORE (CN) – Maryland’s Democratic attorney general filed an administrative complaint Wednesday accusing an apartment management company owned by President Donald Trump’s adviser and son-in-law Jared Kushner of overcharging tenants and leasing them rodent-infested units.

Attorney General Brian Frosh’s office said in a statement that Westminster Management, one of 26 companies named in the complaint, “routinely failed to address hazardous conditions in the properties, including rodent and vermin infestations, water leaks, and mold growth, forcing tenants to vacate their homes or live in unsanitary conditions.”

Westminster also allegedly “demanded, collected, and retained hundreds of thousands of dollars in illegitimate fees from prospective and actual tenants, including charging application fees that exceeded the amounts permitted under Maryland law,” Frosh said.

The 39-page complaint filed with the attorney general’s consumer protection division alleges thousands of violations of Maryland law. The case will be heard by an administrative law judge in January, and any ruling can be appealed to state courts.

An appeal is the likely outcome, as Kushner Companies CEO Laurent Morali told the Baltimore Sun they would fight what he called “bogus allegations.” The group rejected a proposed settlement agreement last month.

“We refuse to be extorted by an ambitious attorney general who clearly cares more about scoring political points than fighting real crime and improving the lives of the people of Maryland,” Morali told the newspaper.

Frosh has been investigating the companies since 2017, after investigative reports in ProPublica and the Sun unearthed systemic overcharging of tenants in eviction lawsuits and classic slumlord conditions in some of the more than 9,000 apartment and townhouse units the companies control in Maryland.

“We’re charging that Westminster and the rental property owners in this case took advantage of consumers, primarily low- and middle-income families, collecting fees and other unlawful costs from them and often failing to make the repairs needed to maintain suitable environments for their tenants,” Frosh said in a statement announcing the charges.

He said the hundreds of thousands of alleged individual violations “harmed thousands of Maryland consumers.”

According to the complaint, the Kushner-owned Westminster and the other companies routinely charged more than the allowed $25 for an application fee, plus illegal late charges and other fees they were not entitled to collect under state law.

The companies are also accused of renting apartments and operating as a collection agency without the required licenses.

“During consumers' tenancies, the respondents use Maryland laws governing evictions aggressively and, at times, illegally to collect rent from consumers, including by misapplying consumers payments to trigger late rent payments and mischaracterizing charges as rent to unlawfully increase their collections from consumers,” the complaint says. “The respondents also sought to collect over $300,000 in sham ‘agent’ fees, which were charged to tenants on a monthly basis for almost four years despite the fact that they were never actually incurred.”

The filing says the apartment companies “have victimized consumers, many of whom are financially vulnerable, at all stages of offering and leasing consumer realty.”

In addition, renters allegedly “have had to endure living in units that are infested by rodents and vermin, plagued with water leaks that have caused mold and other issues, and, at times, lacking in basic utilities.”

“The respondents…have represented to consumers through their advertising and model apartments that that they will provide them with safe and well maintained residential realty,” the complaint states. “Instead, the respondents have rented apartments and townhomes to consumers that are distressed, shoddily maintained, and have conditions that can adversely impact consumers' health and well being.”

Frosh is seeking an injunction requiring the companies to stop charging illegal fees, maintain the required licenses, and stop engaging in unfair and deceptive practices. He also seeks restitution and penalties for violations of Maryland’s Consumer Protection Act, which Frosh told the Sun could reach into the millions of dollars.

Categories / Business, Consumers, Law

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