Attorney General James stops New York City landlords who harassed rent-stabilized tenants and lied to banks

Ink Property Group illegally bought out tenants, deregulated rent stabilized units and forced residents to live in dangerous conditions

AG James secures over $400,000 for affected tenants and up to $1.75 million to preserve affordable housing

NEW YORK – New York Attorney General Letitia James today announced a settlement with Ink Property Group LLC (Ink) for violating rent stabilization laws and unlawful harassment of tenants. Ink — controlled by Eden Ashourzadeh, Alex Kahen and then-Public Attorney James’ 2016 Worst Landlords List offender Robert Kaydanian — purchased dozens of rent-stabilized buildings in low-income communities of color with the intention of illegally deregulating affordable housing for profit. Through a series of illegal activities, Ink forced out rent-stabilized tenants so that their units could be offered at market rate. Ink also intentionally submitted false documents to financial institutions and lied about rent and occupancy to obtain loans. As part of the settlement, Ink will pay up to $1.75 million to preserve affordable housing and over $400,000 in restitution to tenants. Ink will also bring at least 28 apartments that were illegally deregulated back into rent stabilization, making them permanently affordable. Ink is also required to install a screen and an external property management company to ensure compliance with rent stabilization laws and manage their buildings, which will be overseen by the Office of the Attorney General (OAG).

“As New Yorkers faced skyrocketing rents and struggled to find affordable housing, Ink sought to get rich quick by preying on vulnerable tenants and their families,” said Attorney General James. “Lying and cutting corners to avoid rent stabilization is one of the oldest tricks of the trade, but Ink’s years of exploiting our hard-working neighbors without consequence ends here. These tenants organized and fought back, and because of their efforts, they will be compensated for the suffering they have endured. My office will continue to fight for tenants and to preserve affordable housing by ensuring that bad actors like Ink are held accountable.”

Between 2014 and early 2019, Ink purchased 32 multifamily buildings in New York City, primarily in northern Brooklyn and other predominantly low-income communities of color. Ink also acted as property managers for 12 additional buildings. The company implemented a strategy of purchasing small to mid-sized apartment properties with primarily rent-stabilized units. Ink would then engage in a campaign to force out all rent-stabilized tenants—first illegally approaching tenants with buyouts, then repeatedly and persistently harassing tenants and in some cases creating dangerous conditions so tenants were forced to leave , because their apartments were no longer livable. Ink even provided monetary commissions to employees who successfully convinced tenants to move out, offering up to $5,000 for each buyout.

Once the rent-stabilized tenants were evicted, Ink would renovate the units with cosmetic updates and rent the apartments at the highest price the market would allow. Ink ignored the Individual Apartment Improvement (IAI) system outlined in the rent stabilization laws and instead treated each new vacancy as an unregulated unit, regardless of whether the renovations completed met the criteria to achieve deregulation. Ink also failed to properly document any IAI calculations and repeatedly failed to file annual rental registration statements with the New York State Department of Homes and Community Renewal (HCR) for the majority of the buildings in their portfolio. The land registration declarations that were submitted often contained incorrect information and incorrect information about the occupancy and regulated status of many of the apartments.

Despite the renovations, buildings averaged more than 1,000 open housing violations, including 115 of the most dangerous violations for conditions like lead-based paint and broken window screens. Some of the violations that remain open today were issued as early as 2017.

One tenant, Maria de la Rosa, lived in her rent-stabilized apartment in Brooklyn for more than 30 years before Ink bought the building. Not long after, Ink employees approached her and repeatedly and aggressively offered buyouts, even after she expressly refused. Ink succeeded in evicting nearly half of Ms. de la Rosa’s neighbors, but then left the vacant units to fall into disrepair to the extent that the conditions affected Ms. de la Rosa’s health and safety. Since Ink acquired the building, she has dealt with cracks in the walls, leaks and rats.

As Ink continued to grow their portfolio, they submitted fake rent rolls to financial institutions to obtain more favorable loans or refinance their mortgages. The fake documents reported exorbitant rents and fake leases – often with family, friends and associates listed as “tenants” – to pretend high profitability. A four-year investigation conducted by the OAG with assistance from HCR found that Ink repeatedly and consistently committed various fraudulent acts for personal gain and violated the New York State Rent Stabilization Code, the New York City Rent Stabilization Law, and the New York City Housing Maintenance Code.

As part of the settlement announced today, Ink will pay up to $1.75 million to Attorney General James’ Affordable Housing Fund with the New York City Department of Housing Preservation and Development (HPD), which funds the preservation and creation of affordable housing in New York. Town. Ink will also pay $400,000 in damages to tenants who were harassed by Ink to leave their apartments, and $2,500 each to tenants who were forced to live in dangerous conditions intentionally created by the construction. At least 28 apartments will be rezoned as determined by independent counsel engaged by the monitor, and tenants who were previously overcharged for those units will also receive overcharge amounts to amounts yet to be determined. These funds are to be disbursed by the monitor, and the new independent property manager will take over the management of 15 buildings that Ink currently owns and manages.

OAG would like to thank HCR, HPD and the Ink Tenant Coalition for their support and partnership. The Ink Tenant Coalition is led by St. Nicks Alliance and includes the Fifth Avenue Committee and the Flatbush Tenant Coalition. Additional thanks to Communities Resist (CoRe), TakeRoot Justice, and Stabilizing NYC for providing representation and support to the Ink Tenant Coalition and community groups organizing tenants against predators.

“Ink Property Group’s illegal activities have caused tremendous pain to their tenants, many of whom are people of color,” said United States Representative Nydia Velázquez. “Unfortunately, housing discrimination and landlord mistreatment of tenants is not a rare occurrence, which is why I introduced Landlord Liability Act which would help prevent the despicable actions that Ink has taken. I will continue to fight in Congress to provide federal protections for tenants, and I thank Attorney General James for leading the effort to secure financial consequences for Ink and help secure restitution for affected tenants.”

“Landlords in our city are taking advantage of loose rules to illegally harass tenants, implement excessive rent increases and pursue evictions without due cause, but we’re not taking it lightly anymore,” said Brooklyn Borough President Antonio Reynoso. “As a council member – and in partnership with the St. Nick’s Alliance, I led the creation of the North Brooklyn Housing Taskforce that went after some mismanaged Ink Proprieties, the group Attorney General James is settling with today for their bad actions against tenants. Thank you to Attorney General James for her leadership on this issue, telling landlords and property groups that we will hold them accountable for unfair treatment of tenants.”

“In the midst of this severe affordable housing crisis, all levels of government must work relentlessly to protect every precious rent-stabilized unit and the New Yorkers who call them home,” said Assembly Member Emily Gallagher. “Attorney General James’ settlement with Ink Property Group should serve as a warning to landlords who prey on tenants and evade our laws: You are on notice. I am grateful to the Attorney General and her team for steadfastly defending tenants in my district and across New York.”

“We must crack down on any predatory landlord who harasses tenants, removes affordable housing and destabilizes our community,” said New York City Councilman Lincoln Restler. “This settlement secured by our Attorney General Letitia James is exactly the type of aggressive accountability we need every time against bad landlords.”

“The settlement is a crucial and important landmark that sends a strong message to shady LLCs like Ink Property Group that believe they can come into our neighborhoods to target and displace low-income communities of color,” said New York City Councilwoman Jennifer Gutiérrez. “This decision is a reminder that tactics like tenant harassment and falsifying financial documents have real consequences, and that this exploitative behavior cannot rein in our city.”

“Despite New York’s robust housing laws, landlords like Ink Property Group routinely betray the public trust by hoarding units, exploiting and harassing low-income tenants, and evicting families in a relentless pursuit of profit,” said New York City Councilwoman Sandy Nurse. “Thanks to the leadership of the Attorney General, the St Nick’s Alliance and tenant leaders who faced these abhorrent conditions, Ink Property Group will be held accountable and tenants will see some justice. Let today be a message to similar landlords : Stop harassing our constituents, and stop stockpiling in a housing crisis.”

“St Nicks Alliance and the Ink Tenant Coalition celebrate this action and justice is finally being served,” said Frank Lang, Housing Director, St. Nick’s Alliance. “The families have endured undue hardship and threats to their home security at the hands of Ink Property Group. Ink used illegal and aggressive practices to displace long-term tenants. Unfortunately, this is not an isolated incident as many New Yorkers suffer as a result of illegal landlords. To to tenants who continue to suffer, our message is “You are not alone, we are here to help.”

“The Fifth Avenue Committee is proud to stand with Ink property tenants demanding justice and respect and saying enough to all the harassment tactics and illegal acquisitions that tenants have suffered for years! Thank you to Attorney General Letitia James for her and her team’s commitment to ensure that New York tenants get justice,” said Michelle de la Uz, Executive Director, Fifth Avenue Committee. “This settlement sets a precedent for supporting our communities of color who are being displaced by the abuses of these predatory companies who have a clear agenda of harassing and displacing families from rent-stabilized apartments. This is a victory for tenants and the tenant movement in New York City, that was years in the making. FAC is committed to fighting alongside tenants to protect their rights.”

This case was handled by Senior Enforcement Counsel Rachel Hannaford, Assistant Attorney General Jane Landry-Reyes and Housing Protection Unit Chief Brent Meltzer, as well as Assistant Attorney General Hannah Baek of the Bureau of Internet and Technology, Special Assistant for Housing and Community Development Kerri White and Director for research and analysis Jonathan Werberg. The Housing Protection Unit is part of the Social Justice Division, which is headed by Deputy District Attorney Meghan Faux and overseen by First Deputy District Attorney Jennifer Levy.

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