House Flipping Predators LLC

 

THE CITY

Three years ago on a wintry afternoon, JJ was sitting in bed in her Bushwick apartment when she heard a boom at the door. It sounded like an intruder was trying to kick his way in.

JJ, who is Black, peered through the peephole and saw three white men in suit jackets. She was afraid. They looked like detectives. 

“I opened my door, and I’m like, ‘How can I help you?’” recalled the 42 year-old mother of two, who agreed to speak on the condition of anonymity, citing safety concerns.

That’s when, she said, one of the men introduced himself as “the new owner of the building.” 

“I’m like, what? Excuse me?” recalled JJ, who had moved in about seven years earlier and previously paid rent to the relative of a friend living upstairs.

The man told JJ she had a few months to move out. As she stood by bewildered, his two associates were already at work putting new locks on her door.

What JJ didn’t know was that months earlier a group of strangers had indeed acquired title to the house, just a short walk away from the bars and clubs popular with Bushwick’s newcomers. They’d found five far-flung heirs of the property’s deceased owner and convinced them to sell their fractional inheritances for a grand total of $35,500, according to city deed records. 

JJ’s home was not their only target. A new investigation by THE CITY has found 119 properties across the five boroughs acquired in part or in whole by companies operated by two brothers, Elliot and Joseph Ambalo, and their business partner Etai Vardi. This crew of speculators nab properties in gentrifying Black and Latino neighborhoods, where many homes are ripe for the taking because their original owners died without wills, leaving a network of dispersed inheritors who may not know the value of their partial shares. 

As THE CITY previously reported, similar rings amass partial shares to shake down longtime homeowners for money or to profit from forced home sales. But the Ambalo brothers and Vardi often capitalize on another method: using generically named LLCs like The Queens Foundation and Jackie 42, they find small, multi-family homes with minimal tenant protections, take over the properties by paying heirs low sums, then rush to evict the residents, clearing the path to flip the properties for many times what they paid.

This ring’s maneuvers, which have displaced dozens of longtime city residents, are largely legal. But in some of their transactions, THE CITY found evidence of possible fraud. One notary public based in California believes that her signature was forged on a deed-related affidavit that Vardi also signed. Four other notary publics across the country said they did not sign or recognize their purported signatures that appear in paperwork signed by Vardi or one of the two Ambalo brothers.

The Ambalo brothers and Vardi rebuffed THE CITY’s attempts to interview them at length in person and on the phone. In response to a detailed set of questions sent to them ahead of publication, Vardi shared a brief statement in an email on behalf of the ring.

“The purchase of fractional shares of properties is a long-standing, lawful business practice in the real estate industry,” Vardi wrote. “We have always and will continue to operate within the law and in an ethical manner.”

Of the 119 properties THE CITY identified, 34 have been the subject of eviction or removal petitions filed by the investors’ LLCs, which named 160 residents they wanted out of their newly acquired properties, according to court records. In 19 of these cases, the speculators failed to register their ownership with city authorities, a violation of New York City’s Housing Maintenance Code, before moving to evict tenants. 

In 29 of the 119 properties, city deed records show the investors completed a flip of partial home shares or entire properties. In all, they paid heirs and other property-holders nearly $4.8 million then subsequently sold the shares to new buyers for $14.3 million — a $9.5 million difference.

In many cases, the flips and displacement went hand-in-hand.

THE CITY 

 

Limited Liability Companies Associated with Joseph and Elliot Ambalo and Etai Vardi

135 STREET INVESTORS LLC

153 FOCH LLC

1847 NEREID LLC

19138 115 ROAD ASSOCIATES LLC

229 CLIFTON PLACE LLC

76 ROCKAWAY BLVD LLC

ACTION NO 37 LLC

ACTION NO 53 LLC

BERGEN STREET MANAGING PARTNERS LLC

BK 146 LLC

BK 950 LLC

BK AUTUMN 701 LLC

BK BEVERLEY LLC

BK DEVOE LLC

BK DEVOE STREET LLC

BK MACON LLC

BK ROSEDALE LLC

BK SARATOGA LLC

BK SHEFFIELD LLC

BLACKROCK EQUITY GROUP LLC

BLACKROCK REAL ESTATE GROUP LLC

BLACKSTONE REAL ESTATE GROUP LLC

BROOKLYN GATES LLC

BX 1076 LLC

BX 1331 LLC

BX MULINER LLC

BX ROSEDALE LLC

EAST NEW YORK RLTY LLC

GILLESPIE AVENUE DEVELOPMENT LLC

GREEN BAMBA LLC

JACKIE 42 LLC

KINGS COUNTY FOUNDATION LLC

MACDONOUGH STREET DEVELOPMENT LLC

MANHATTAN FOUNDATION LLC

MN W 152 LLC

NEW YORK ASSET RECOVERY FOUNDATION LLC

NEW YORK ASSET RECOVERY GROUP LLC

NORTH BRONX VENTURES LLC

NORTH BUSHWICK VENTURES LLC

NORTH QUEENS VENTURES LLC

ONE EIGHTEEN 204 HOLDINGS LLC

ONE THREE SEVEN 24 HOLDINGS LLC

ONE TWENTY TWO HOLDINGS LLC

ONE ZERO FIVE 39 HOLDINGS LLC

QN 147 VENTURES LLC

QN 204 LLC

QN 48 LLC

QN NAMEOKE LLC

QN ST ALBANS HOLDINGS LLC

SOUTH BRONX VENTURES LLC

SOUTH JAMAICA HOLDINGS LLC

SOUTH JAMAICA HOLDINGS 2 LLC

STATEN ISLAND VENTURES LLC

THE BROOKLYN FOUNDATION LLC

THE EASTERN AND ATLANTIC FOUNDATION LLC

THE QUEENS FOUNDATION LLC

THE QUEENS FOUNDATION MMXX LLC

The city paid a big price for a toxic site to place an animal shelter in Ridgewood

Just like de Blasio's deal with the Podolsky's it looks like the city way overspent again. This time for the animal shelter in Ridgewood. The city paid 13.2 million dollars for property worth about $946,000. That's 12.3 million dollars that could have been used in an emergency like, oh, I don't know, in case there was a global pandemic or something less catastrophic but economically devastating.

The real kick about this is that this deal was made when Bill de Blasio was running for president and was barely showing up to City Hall at the time.



 Thank you Lucky for this scoop.

DeBlasio unfairly seizing properties

From Kings County Politics:

Mayor Bill de Blasio today defended the city’s taking of more than 60 properties in Brooklyn – including those of at least three fully paid off African American owned properties worth millions of dollars – and transferring their ownership for “re-development” to non-profit and for profit companies.

But New York State Attorney General Candidate Keith Wofford took de Blasio and the entire city government to task for incompetence at best, and illegal political corruption at worst, in seizing the properties.

“What’s happening here is disgraceful and likely illegal. Mayor De Blasio lives nearby and sleeps securely at night, while his administration creates anxiety and fear among vulnerable citizens whose largest asset is ripped away without compensation or due process,” said Wofford.

Wofford went so far as to call the foreclosure proceedings “unconstitutional,” and urged the Mayor to act immediately in stopping anymore transfers under the program.

The program that the city’s Department of Housing Preservation & Development (HPD) utilizes in taking properties is called the Third Party Transfer (TPT) program, which goes back to the 1980s when New York City had many blighted and burned out properties. The program designates qualified sponsors to purchase and rehabilitate distressed vacant and occupied multi-family properties in order to improve and preserve affordable housing for low-to moderate-income households.

Over the years the program has been amended in its definition of distressed properties, most recently in 2016, in which the City Council approved an expansion of the program to include buildings which are subject to Environmental Control Board (ECB) judgments as a result of building code violations in the amount of a lien to value ratio equal to or greater than 25%.

In order for HPD to obtain the foreclosure judgments, the agency sought, needed and received city council approval – an approval that some city council members now say they approved because HPD misled them.

The story came to light, when KCP learned the city foreclosed on Marlene Saunders, 74, a retired nurse, who nearly lost her paid-off and in pristine condition brownstone at 1217 Dean Street on a rapidly gentrifying block in Crown Heights.

The three-story brownstone had been in the Saunders family for 30 years and has been appraised at over $2.2 million. Saunders son showed KCP copies of checks paid and cashed by the city for property and water taxes, but were never applied to the property. He also stated the family knew nothing about the court proceeding, in which a foreclosure judgement was issued and only learned the family no longer owned the property through a flyer delivered to the brownstone months after they lost the deed.

101-year old man swindled out of home

From the Forum:

A Queens man who took advantage of his friendship with a 101-year-old neighbor is facing up to 15 years in prison for tricking the centenarian into signing over the deed to his home.

Authorities say Ricardo Bentham, 58, of 118th Avenue, has been charged with grand larceny and other crimes for allegedly conning a neighborhood friend into transferring the deed of his long-time home into the defendant’s name in October of 2017.

According to the criminal complaint, the defendant submitted a quitclaim deed to be filed with the city on October 5, 2017. The document stated that 101 year-old Woodrow Washington was transferring ownership of his 143rd Street home which has a value in excess of $50,000 to the defendant for a sale price of $0. The victim realized something was wrong when he received a letter from the Department of Finance stating that the deed to his home had been transferred to Bentham. An inquiry was conducted and revealed the document that was filed bears the signature of the Mr. Washington along with a notary stamp and signature of a notary.

Mr. Washington stated that the signature on the form is his, however, he is adamant that he never signed any documents in front of a notary.

Mr. Theodore White, the 93-year-old notary, acknowledged knowing Bentham and would often sign documents for him because he trusted him. The document bearing his signature was missing the notary seal, which White always added to a document.

Mr. Washington identified the defendant as a neighborhood friend who offered to help him collect rent from tenants. He recalled signing documents that the defendant brought to his residence and that some were blank.

Steinway Mansion owners purchase adjoining property

From George the Atheist:

The owners of the Steinway Mansion, 18-33 41st Street (Block/Lot 802/31), Salvatore Lucchese and Phillip Loria, were deeded less than three weeks ago - February 28 - possession of 2 parcels of adjoining land immediately south of the Mansion on 41st Street: 18-39 (Block/Lot 802/27) and 18-41 (Block/Lot 802/29).

The two addresses belonged to the late Armin Urban who passed away last year. The deeds to the properties were conveyed to Lucchese and Loria (aka1839 Lucc LLC and 1839 Lor LLC) 18 days ago by Urban's heirs.

Question for Queens: How will this recently acquired property be used:
1. For a Steinway Mansion expanded parking facility?
2. For new development of commercial and/or residential units?
3. For park-like recreation?
4. To lie fallow for possible sale in the future?

City getting away with filing fraudulent deed

From the Daily News:

A man who swiped an elderly woman’s house with phony documents did time for the crime — but an appellate court is letting the city off the hook for processing the paperwork that let the ex-con make himself at home.

A Brooklyn appeals court has ruled that a judge was right to toss a lawsuit brought against the city by Jennifer Merin — whose Queens abode was filched by a criminal who filed a fraudulent deed.

Merin, 74, had sued the city for not catching the forgery when the paperwork was first filed, but lost on appeal when the court backed a judge who said she couldn’t prove the city was negligent.

The feisty homeowner is fuming and has vowed to fight the decision.

“I find it absolutely astonishing and sickening that the city that gave away my property without due process by registering an obviously fraudulent deed, while it was still charging me for taxes on that property and water usage on that property, is now insisting that it has no accountability for those actions,” Merin told the Daily News.

The city said Merin was suing over a missed “needle in a haystack,” according to court papers.

The phony deed that started all the problems was one of almost 1,400 deeds recorded that week, city lawyers noted.

11 people, 2 companies cited in deed fraud

From CBS 2:

Eleven people and two corporations have been indicted by a grand jury in a fraud scheme that cost several homeowners their property deeds in Queens, prosecutors said Wednesday.

The defendants – nine of whom were in custody of as of Wednesday and two of whom were still being sought – were accused in a scheme where they fraudulently took the deeds away from homeowners, according to the Queens District Attorney’s office.

Half of the victims were elderly, prosecutors said.

The investigation began in 2014, when several Queens homeowners told prosecutors they had received cold calls from people employed by the Kings Development Group in Queens. The callers allegedly said they would assist the homeowners with whatever financial problems they were having with their homes, prosecutors said.

It turned out that the company was not assisting the homeowners, but tricking them into signing over the deeds to their property, prosecutors said.

The deeds were transferred to a corporate entity, but the homeowners were still financially responsible for their mortgages, prosecutors said. Once the new deeds were recorded, the defendants allegedly advised the current tenants that they were the new owners and started collecting monthly rents, evicted the homeowners who were now their tenants, or told the New York City Housing Authority and the Department of Social Services that they were the new homeowners and started collecting subsidies, prosecutors said.

Deed fraud scammer gets a year in the pen

From the Daily News:

An ex-con who stole an elderly woman’s Queens home now has a new place to crash — in the big house.

Darrell Beatty, 51, was sentenced to one year behind bars for his cunning con in which he used a phony deed to move into Jennifer Merin’s Laurelton home.

Merin, 72, said the ordeal — which required she jump through a slew of bureaucratic hoops before getting Beatty evicted — had caused her so much stress she had a heart attack in August.

"This crime has ripped my heart out, squashed my spirit, and left me in financial ruins. It has turned my life upside down I am 72 years old, and I am forced to begin building my life again,” she said before Beatty was sentenced.

“(My) home has been desecrated. It no longer exists, and I am bereft, heart broken, devastated. I am afraid to go on the property ... I have been in a constant state of inescapable and overwhelming fear, anguish, depression, and the daunting stress of financial duress.”

Beatty, who showed up late for his sentencing, did not address the court. His attorney declined comment.

Justice Michael Aloise, who recommended Beatty not be eligible for parole, called Merin’s statement “one of the most sincere and compelling I've ever heard.”

Dirtbag gets jail for house theft

From the Daily News:

A Queens ex-con pleaded guilty on Friday to stealing an elderly woman's house out from under her.

Darrell Beatty, 51, pleaded guilty to criminal possession of a forged instrument for using a phony deed to swipe Jennifer Merin's Laurelton house out from under her.

As a result of the plea deal, he'll get even more free housing — it calls for him to get a year in jail.

Merin, 72, said that's not enough time.

"I'm glad he's going to jail. He deserves to go to jail but I think that the sentence was too brief," she told the Daily News after Beatty's plea. "He lived in my house for longer than he will be in jail and he'll be out on the streets again."

City not responsible for filing fraudulent deed

From the Daily News:

An elderly Manhattan woman whose family homestead in Queens was stolen through deed fraud has no right to sue the city or the City Registrar for damages, a Queens judge ruled Friday.

Supreme Court Justice Kevin Kerrigan said that Jennifer Merin, 72, cannot sue for negligence because the City Registrar has no obligation and no authority under law to make sure that the deeds it accepts for filing in all five boroughs are legitimate.

Merin's lawyer, Christopher Campbell, whose law firm DLA Piper is representing Merin for free, said they will appeal.

"The judge seems not to acknowledge our (argument) that the city failed to follow its own rules in processing this deed,” he said.

“Deeds are supposed to have metes and bounds. This deed was completely blank on that. The previous owner is supposed to be the seller. This had a different name entirely. And this house was given away for free. All of these things should have been red flags,” he said.

Deed fraud is quite easy

From CBS 2:

Con artists are easily stealing homes in New York City through “dirty deeds.”

As CBS2’s Steve Langford reported Monday night, scam artists are accessing homeowners’ deeds online and then putting these homes up for sale, entering into contracts with several unsuspecting buyers, and flipping it for a profit.

“As long as you have the address, that’s all you need,” Jason Reddish, real estate expert and chief executive officer of Total Merchant Resources, told CBS2.

Hundreds of deed fraud cases under investigation

From the Daily News:

The city is dealing with a spate of cases where crooks swipe homes from under the owner’s nose through deed fraud schemes, officials said Monday.

The Department of Finance is pursuing 525 open investigations involving 671 properties across the five boroughs, mostly in Brooklyn and Queens, according to the agency’s testimony to a City Council hearing.

The thefts involve either outright forgery - where a deed to change ownership is filed with a fake signature - or scams where homeowners are talked into signing over their property, often on the promise of help with a delinquent mortgage or other financial trouble.

Laurelton deed scammer going to trial

From the Daily News:

Criminal proceedings against an ex-con accused of stealing a 70-year-old woman’s house out from under her will proceed as planned, a Queens judge ruled Friday.

Darrell Beatty, 50, can’t hide from the 10 charges against him related to his alleged deed scam against homeowner Jennifer Merin.

Beatty, 50, could face up to 15 years in prison if convicted on grand larceny, burglary and other charges for allegedly forging paperwork declaring him the owner of Merin's three-bedroom Laurelton home.

Woman sues city for allowing house to be stolen

From the Daily News:

A woman whose Queens home was stolen out from under her is suing the city for allowing the theft to happen.

Jennifer Merin charges in documents filed in Queens Supreme Court that the city allowed Darrell Beatty to claim her house as his own, live there for eight months, then plunder and trash the Laurelton property.

“They know this has been a problem and have not corrected it. I was victim of the same negligence. It turned my life upside down, completely,” Merin, 72, told the Daily News.

Her suit charges that the deed Beatty submitted to the City Register in March 2014 was so sketchy it would have raised many red flags if officials had paid attention.

The deed listed an Edith Moore, who does not exist, as the transferor, papers claim. The deed also reported the sale price as $0.00.

“There was no due diligence,” Merin said.

A Law Department spokesman said recent reforms have taken place at the city’s Department of Finance.

Deed fraud is big business

From the NY Times:

A review by The New York Times of several dozen cases, and interviews with lawyers, prosecutors and others knowledgeable about fraudulent deed transfers, suggests they are accelerating even as officials struggle to address them. The city’s Department of Finance said it was investigating 120 cases, many of them hard to crack because of the role played by LLCs, officials said. Underscoring the rising alarm over the problem, the state attorney general, Eric T. Schneiderman, and the Brooklyn borough president, Eric L. Adams, held a forum last month to warn property owners about it.

Deed thieves often scan legal notices for mortgages in arrears, typically targeting properties like Ms. Campbell’s that are in poor repair or abandoned. Vulnerable homeowners — including older and disabled adults — are sometimes tricked into signing over their properties, while believing they are getting financial relief.

In other cases, signatures are simply forged on deeds. The thieves, meanwhile, hide behind inscrutable mazes of limited liability companies, rented post office boxes and fake addresses.

NYPD cop charged with stealing house

From NBC:

A 45-year-old NYPD officer has been indicted on multiple felony counts, including grand larceny, for allegedly forging a deed to a home in Brooklyn and stealing the property from the rightful owner.

Blanche O'Neal, 45, assigned to the 83rd precinct, allegedly submitted a deed in July 2012 indicating she had bought a property on Vernon Avenue for $10,000. The deed said she purchased the property from Colie Gallman, Jr., the sole heir of Lillian Hudson, who had owned the property before she died.

About three years later, O'Neal called authorities to report someone had transferred her property to a corporate entity without her permission and alleged she was the victim of deed fraud. O'Neal told detectives she had won a $5,000,000 lawsuits against the estate and was awarded the home as part of a settlement from the person she claimed was the sole heir, Colie Gallman.

As part of their investigation into O'Neal's allegation, detectives began looking into the deed transfers on the property going back to the ownership of Lillian Hudson. They determined the deed filed by O'Neal was fraudulent, according to prosecutors.

Weird deed fraud case in Jamaica Estates

From the Daily News:

The strange saga began on April 29 when Anita Chan returned from work to her Jamaica Estates home and found the locks changed — and three strangers inside, according to the complaint.

When she questioned them, the trio told her they were working with the bank that held the mortgage and she would not be allowed inside until she signed some documents, the complaint states.

Chan, 60, then told the intruders her husband, Wah Chan, was the sole property owner and that he was in China.

So they had her call him — then emailed him documents to sign, including a deed transfer.

While Wah Chan signed some of the paperwork, he did not sign the deed transfer, according to the complaint.

The next day, the accused home invaders let the poor woman back inside and gave her 10 minutes to retrieve some of her belongings, Brown said.

Inside, Chan discovered that the house on Grand Central Parkway had been ransacked, he said.

It wasn’t until May 16 that her 73-year-old husband returned from China and arrived at the house with a locksmith of his own.

Not only were jewelry, knives and cash missing, so were documents verifying ownership of his home, Brown said.

It wasn’t immediately clear why the trio allegedly targeted the Chans.

2 guys stole a bunch of houses

From the Daily News:

Two Long Island men stole nine houses in Brooklyn and Queens and then either rented them out or sold them, prosecutors said Wednesday.

Danny Noble, 45, and Romelo Gray, 37, went to the city Finance Department and filed false documents to turn over the titles of seven Brooklyn addresses and two others in Queens, Brooklyn DA Kenneth Thompson said.

From June 29, 2010 to March 31, 2015, Noble and Gray allegedly stole homes in Fort Greene, Canarsie, Bushwick, East New York, Jamaica and Hollis that were either vacated or rarely used.

They are charged with conspiracy, criminal possession of stolen property, grand larceny and falsifying business records.

A lot of deeds have been stolen

From DNA Info:

Since spring 2014, the city sheriff’s office, which is part of the Finance Department, has made combating deed theft a top investigative priority.

Sheriff Joseph Fucito and the Finance Department stepped up their vigilance after a series of high-profile stories exposed the ease with which scammers could register deeds in city records.

Now the Finance Department flags any deed transfers that are filed with defective information and sends them to the sheriff’s investigators.

Between July 1, 2014, and April 30, 2015, the sheriff’s office received a total of 755 complaints of suspected deed thefts — with the Finance Department sending 597 of them. More than 150 came from individual people filing complaints.

The sheriff has so far opened criminal investigations into more than 100 of those complaints and more than a half dozen people have been arrested.

Squatters trash stolen home prior to eviction

From Eyewitness News:

A Queens woman who had her family home stolen in a phony deed scam is finally back inside the house, but the condition it was left in made for anything but a happy reunion.

A city marshal armed with an eviction order broke the lock of Jennifer Merin's home in Laurelton Monday morning, a lock put there by squatters months ago.

Escorted by investigators from the sheriff's office, the 70-year-old Merin finally got back inside to see what was left behind. And the mess wasn't pretty.

"It feels like they've really trampled on the graves of my family," she said.