City continued to do business with house deed theft recidvist

New York Times

Sanford Solny, a real estate investor and disbarred lawyer who has been accused of stealing dozens of homes in New York City, mostly from Black and Latino homeowners, was charged on Wednesday with crimes related to the theft of four more properties in Brooklyn.

The Brooklyn district attorney’s office charged Mr. Solny with criminal possession of stolen property and scheming to defraud homeowners. Prosecutors accused Mr. Solny of renting out some of the disputed homes to unwitting tenants and collecting nearly $64,000 in rent.

Mr. Solny faces similar charges from a 2020 indictment, in which he was accused of stealing eight other homes. The two indictments have been consolidated. If convicted, he faces a minimum of three to six years in prison.

Mr. Solny, 65, surrendered to authorities on Wednesday and appeared in court in handcuffs. He pleaded not guilty and then was released. He is scheduled to be in court in March for the latest charges. After announcing the new charges, the district attorney’s office withdrew a plea deal offer in which Mr. Solny would serve four to 12 years in prison.

The new case follows an investigation last year by The New York Times that revealed that Mr. Solny, through a network of shell companies, had been accused in civil and criminal court by 40 homeowners of stealing their property in a scheme known as deed theft.

As of July, companies controlled by Mr. Solny still owned 19 of the disputed properties — an eclectic mix of coveted brownstones and grass-hemmed houses in gentrifying areas of Brooklyn and Queens that could produce hundreds of thousands of dollars in rent a year. In some instances, city agencies contributed to his earnings by subsidizing the rent for low-income tenants.

Deed theft can take many forms, but homeowners have repeatedly accused Mr. Solny of one version.

Homeowners at risk of foreclosure are told they qualify for a short sale, a deal in which the lender settles for less than the balance of the mortgage. The homeowners usually believe that they are selling the home in exchange for debt forgiveness and sometimes a small amount of cash.

Instead, the owners sign documents, often under false pretenses, that transfer the property to another party, leaving the former homeowner saddled with the unpaid mortgage debt. Yearslong legal battles can play out in civil court, often ending in the lender seizing the property — but not before the fraudulent owner extracts value by renting the home out.

Many of the homeowners who have accused Mr. Solny of fraud live in predominantly Black and Latino neighborhoods in central Brooklyn. The four properties in the latest indictment unveiled on Wednesday — homes in East New York, Ocean Hill, Canarsie and East Flatbush that are valued at a total of nearly $2.3 million — were transferred to companies controlled by Mr. Solny between 2012 and 2019 for a fraction of their current market value, according to the district attorney’s office.

Pols call for moratorium on property seizures

From PIX11:

Hundreds of homeowners throughout New York City have been defrauded out of their homes. Now, elected officials are calling for a federal investigation into the matter, including whether a city program may be partly to blame.

"There needs to be a moratorium on taking houses from these homeowners until we can make sure that somethings not unethical, illegal, or immoral," said Brooklyn Borough President Eric Adams.

Adams says his office has heard dozens of similar stories over the past year: homeowners in rapidly gentrifying areas, like Bed-Stuy, forced out of their homes. He says it's usually been one of three causes:

Forced foreclosures
Deed fraud
City's third party transfer program

"We believe when you have something of this magnitude that could be a large number of black and brown homeowners losing their homes, when the dust settles we cannot look back and say wow we should have paid attention to this," Adams said.

Which is why he and City Council Member Robert Cornegy are calling for a stop on all property seizures pending federal, state, and city investigations. For it's part the city's office of Housing Preservation and Development, which runs the TPT program, says it's unfair to lump it in with other illegal activities scamming people out of their homes.

Brooklyn neighborhood under siege

From PIX11:

This was not a forum on issues within public housing, of which there are many, but instead an attempt to focus specifically on private homeowners and tenants.

The frustration circulating through the room came to a boil when it came to deed theft – and the army of sketchy real estate investors residents say prey on struggling homeowners.

“Some of us have identified a single player who is a responsible for a disproportionate amount of skullduggery in Bedford Stuyvesant,” said Brooklyn resident Joe Gonzalez.

“The third party transfer program, broadly speaking, is really mean to protect tenants of these buildings that have been severely distressed,” said Deputy Director of NYC Neighborhood Strategies Leila Bozorg.

Inevitably, the conversation turned to the topic of gentrification, who’s responsible for it – and what can be done to neutralize the impact on private homeowners and tenants, who can no longer afford to live in their own neighborhoods.

On Brooklyn resident told the crowd, “The miseducation of the community is systemic. And the lack of empathy by the politicians has accelerated gentrification in our area. So it’s gonna be hard to stop the foreclosure process right now, because once you start feeding a beast a particular diet, it’s hard to change that diet.”