Tenants of Kushner-Owned Real Estate Fight Predatory Fees

FILE – In this Sept. 12, 2017, file photo, White House Senior Adviser Jared Kushner listens as President Donald Trump speaks during a meeting with Malaysian Prime Minister Najib Razak in the Cabinet Room of the White House in Washington. (AP Photo/Alex Brandon, File)

BALTIMORE (CN) — Companies owned by President Donald Trump’s son-in-law Jared Kushner face a class action from tenants who say they are hounded over unlawful fees under threat of eviction.

Though the real estate scion is not named as a party to the Jan. 27 complaint, lead defendant Westminster Management is a subsidiary of the family-run Kushner Cos., which owns, manages and develops properties across the country.

In the complaint, two tenants who live in Kushner’s Dutch Village apartments in Northeast Baltimore and Carroll Park apartments in Middle River say they are plagued by a vicious cycle of predatory fees.

It starts with a late fee, according to the complaint, which is tacked on to a tenant’s rent if his rent is not paid in full by the end of the fifth day of the month.

But tenants Tenae Smith and Howard Smith (no relation), say a purported court fee and an agent fee are also tacked on around the same time.

“The purported court fee is charged even though such a fee has not been awarded by a court and is often never awarded by a court,” the complaint states.

Even if the tenant has paid part of their monthly rent, the late fee is allegedly set at 5 percent of their full rent.

The tenants say their subsequent rent payments are then improperly misapplied to these improper fees, making them appear further in arrears.

“The fees kept adding up,’” tenant Tenae Smith said in a statement from her attorenys at Brown Goldstein & Levy.

Kushner’s companies dispute the allegations.

“We have been in compliance with Maryland’s laws and regulations and intend to vigorously defend ourselves against these allegations,” a spokesman for the companies said in an email.

Filed in Baltimore City Circuit Court, the complaint takes aim at Westminster Management LLC and JK2 Westminster LLC, both with New Jersey addresses.

Carroll Park Holdings LLC is named as a co-defendant with a New York City address, as is Dutch Village LLC, in College Park, Maryland.

Dutch Village tenant Tenae Smith is described as a mother of two. “One time I paid the rent, and they sent back my check telling me that I needed to pay an additional $150 in fees or they wouldn’t take my rent,” she said in a statement. “I work full-time and made regular payments, but they kept taking me to court for eviction and piling on the fees. I just want to keep my family safe and stable as the kids go back to school.”

Santoni, Vocci & Ortega, in Towson, Maryland, is working with the Public Justice Center and Brown, Goldstein & Levy to represent the Westminster tenants.

“The routine practice of charging tenants illegal fees combined with filing eviction proceedings against tenants who have paid their rent on time is predatory and destructive to hard-working Marylanders and their families,” Santoni Vocci attorney Chelsea Ortega said in a statement. “This is yet another example of corporations profiting from deceptive policies.”

Matt Hill of the Public Justice Center said going to court is important for tenants like those of Westminster “where basic needs, like housing, are at stake.”

“It is virtually impossible for tenants in these situations to decipher their landlords’ account statements and fight back against a slew of fees on the threat of eviction without help from an attorney,” Hill said in a statement.

The other Westminster tenant suit, Howard Smith, is described as a retiree who has lived in the Kushner-owned Carroll Park Apartments in Middle River, east of Baltimore, for 10 years. He has been hit with a string of late fees and court fees and eviction notices even though he has arranged to have his rent automatically debited from his bank account every month.

The complaint says Howard Smith paid his rent in full, but Carroll Park misallocated a portion of that payment to non-rent charges, deemed his rent to be late, then charged him a “legal-summons fee,” even though no court had awarded such a fee. He was also charged a “legal-agent fee.” After the fees were assessed, the company filed an eviction notice to spur payment of the full bill. Smith complied, fearful of eviction.

“Adding small but improper fees to the rent of tenants living paycheck to paycheck, then misallocating rent payments to those fees in order to generate more fees, is a scheme that preys on working-class tenants,” Brown, Goldstein & Levy attorney Andrew Freeman said in a statement. “Westminster Management’s misuse of Maryland courts’ eviction proceedings to force tenants to pay these improper fees makes this scheme all the more deplorable. It must be stopped.”

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