The Real Deal:
A pair of Queens landlords spent years cheating the state out of almost $500,000 in property taxes by manipulating the 421a program, according to a lawsuit from the New York State Attorney General’s Office.
The lawsuit seeks to ban Queens landlords Ram Cohen, Eldad Cohen and their company ERC Holding, LLC from participating in New York’s real estate industry. It also aims to force them to repay the property taxes they dodged, along with the profits they made from selling their building at 71-44 160th Street in Fresh Meadows.
The brothers finished building the 10-unit building in 2009 and applied for a tax exemption with the city under the 421a law, according to New York State Attorney General Barbara Underwood. The exemption requires the Cohens to abide by rent stabilization laws, but the suit alleges that they stuck tenants with unregulated leases instead. The attorney general’s office previously ordered the Cohens to start treating their tenants as rent-stabilized in 2014, but they did not do so, the lawsuit says.
The Cohens also tried to make their building appear more valuable than it actually was by listing inflated rents on all of their leases and giving tenants separate riders where they would agree to pay lower rents, the suit says. They kept these riders secret from banks, regulatory agencies and a prospective buyer to make the building appear more valuable than it really was and sold it in 2016 for $3.75 million, according to Underwood.