POLITICS
03/19/2018 11:52 pm ET Updated Mar 20, 2018

New York City Council Launches Probe Into Kushner Company's False Tenant Records

State attorney general is also talking to tenants.

The New York City Council has launched an investigation into false tenant documents reportedly filed by the Kushner family real estate company that dodged rent laws and boosted profits.

New York State Attorney General Eric Schneiderman is also meeting with tenants of Kushner properties because he’s “concerned about the allegations,” said a spokeswoman.

Hundreds of rent-regulated tenants in buildings owned by Kushner Cos. were protected by city law from being hit with major rent hikes or forced out by a new owner. However, the company “routinely” filed false paperwork stating that the buildings had no rent-regulated tenants from 2013 to 2016, The Associated Press reported. White House adviser Jared Kushner, the husband of first daughter Ivanka Trump, was CEO of the operation during that time.

According to documents obtained by the tenant watchdog group Housing Rights Initiative, at least 80 false applications were filed for construction permits in 34 buildings during that time. They stated that the buildings had no rent-regulated tenants when, in fact, they included 300 rent-regulated units, AP reported. The result was less city supervision at sites. That left tenants vulnerable to being harassed to get out or left to endure the constant disruption of construction as the Kushners sought to hike rents or sell buildings.

City Council member Ritchie Torres announced an investigation into the practice by the Kushner business and other landlords on Monday. He called the Kushner strategy a “weaponization of construction” to force tenants out for higher-paying residents and “deregulate affordable housing units out of existence.”

“The falsification of building permits is not merely about bureaucratic paperwork; it poses a profound threat to the affordability of rent-regulated units ... and it poses a profound threat to the safety of residents who live in these units during construction,” he said.

Torres also blamed the city for failing to check on the Kushner paperwork, which was contradicted by city tax documents. 

Kushner Cos. has said that a third party was contracted to file the paperwork and that documents were amended whenever errors were discovered. “Kushner Companies values all of our tenants and takes our legal and ethical responsibilities very seriously,” said a company statement. 

Housing Rights Initiative, however, said that paperwork often wasn’t amended for a year or two, by which time tenants had already been driven out.

Jared Kushner stepped down from his role as CEO last year but still holds major stakes in a number of family real estate holdings. He maintains a holding in Westminster Management, the Kushner Cos. subsidiary that oversees its residential properties. Westminster has been hit with a class-action lawsuit by Maryland tenants who say they were charged mysterious fees in a bid to drive them out, a charge the company has denied.

Special counsel Robert Mueller is reportedly looking into Jared Kushner’s efforts to secure financing for family real estate operations from foreign investors during the presidential transition that may have influenced his work in the White House.

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