New York Attorney General Letitia James and New York State Homes and Community Renewal (HCR) Commissioner RuthAnne Visnauskas have filed a lawsuit against Zara Realty Holding Corp. (Zara Realty), its principals, and affiliated entities for repeatedly violating rent stabilization laws and overcharging rent-stabilized tenants in Jamaica and Elmhurst, Queens.
The lawsuit alleges that Zara Realty illegally took advantage of tenants who paid their rent through New York City Department of Social Services (DSS) housing subsidy programs and disregarded rent reduction orders issued by HCR’s Office of Rent Administration. Zara Realty would then sue tenants who did not pay these unlawfully inflated rents, putting multiple tenants at risk of eviction.
According to the lawsuit, Zara Realty ignored the legal limits on rent increases, charging tenants the highest possible amount allowable under their program, regardless of the legal rent for their unit as dictated by the Rent Guidelines Board. As a result, tenants were charged rent increases that were significantly higher than the legal amount.
In addition to violating legal rent increase limits, Zara Realty also ignored rent reduction orders issued by the Office of Rent Administration (ORA). The ORA orders landlords to reduce rent when a landlord fails to provide essential services or maintain the property to required standards. Tenants filed complaints with ORA, which then ordered Zara Realty to reduce and freeze their rents. Despite receiving these rent reduction orders, Zara Realty continued to overcharge tenants.
The Office of the Attorney General (OAG) and HCR’s Tenant Protection Unit (TPU) are seeking a court order to stop Zara Realty from charging or collecting illegally inflated rents and force them to refund all tenants who were overcharged. “While hardworking families are battling an affordable housing crisis and fighting to make ends meet, Zara Realty shamelessly took advantage of vulnerable tenants,” said Attorney General James.
“Our Tenant Protection Unit is fighting for New Yorkers every day by protecting them from predatory landlords who try to illegally overcharge their tenants and defy our State’s rent laws,” said HCR Commissioner Visnauskas. “The message from our office and Attorney General James is clear – if landlords fail to abide by the rent laws, if landlords seek fraudulent rent increases, or initiate unlawful evictions – we will not hesitate to take action on behalf of millions of rent-regulated tenants in New York.”
The lawsuit filed by the OAG and TPU argues that since at least 2022, Zara Realty exploited tenants who received DSS housing subsidies, charging them the highest possible amount allowable under their program, regardless of the legal rent for their unit as dictated by the Rent Guidelines Board. As a result, OAG and TPU contend that tenants were charged rent increases that were significantly higher than the legal amount. In one case cited in the lawsuit, a DSS voucher-holder signed a one-year lease with a company owned by Zara Realty in 2022. The following year, the company increased her rent by eight percent, even though the legal limit for increases was just 3.25 percent.
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Key Facts
- State: New York
- Agency: NY AG
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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