Spitzer-daniels Announce Six Charged In City-wide Sweep Of Bogus Apartment Listing Firms
Attorney General Spitzer and Secretary of State Randy Daniels announced today that six people have been charged in a city-wide sweep of fake apartment listing businesses. It's estimated that the businesses scammed consumers out of hundreds of thousands of dollars.
Following a referral from the Secretary of State and information from the department's investigators, a nearly year-long investigation by Spitzer's office resulted today in the arrests of five people, for operating a total of 12 businesses that falsely claimed to have listings of low rent apartments. A sixth person was named in a civil lawsuit for failing to provide adequate apartment listings.
In the criminal case, Spitzer's office has alleged that the Cox-Adderly Group, operating a number of businesses including "Plus Rental," "NYC No Fee Apts" and "World of Apartments" would sign up consumers for a fee of $150-$180 each.
Customers were lured into paying the defendants' fee through newspaper ads for low rent apartments throughout the area. In fact, none of the apartments advertised ever existed.
When consumers would call the phone number they were given for an apartment's 'landlord,'they were actually calling a phone answering machine set up by the group. A 'call backer' employed by the group would return the call posing as a representative of the landlord and ask for income, employment history and other information. The consumer would then hear nothing further from the 'landlord.'
"These five defendants brazenly used the area's hot real estate market to prey on those looking for an affordable place to live," said Spitzer. "Instead, the only thing that consumers received for their money were fake listings leading to non-existent or unavailable apartments."
Daniels thanked Spitzer for acting aggressively and vowed that the Department of State would continue its vigorous enforcement of licensing and consumer protection laws. "What makes this scheme particularly reprehensible is that the fabricated advertisements were specifically designed by these predators to attract and appeal to low income people in minority neighborhoods," said Daniels. "The victims, hardworking citizens seeking an affordable home for their families, had their money stolen from them just as surely as if they had been held up at gun point. We will use all means at our disposal to identify and prosecute those who choose to prey on the public."
The group advertised in area newspapers by claiming it had listings for one bedroom apartments from $450 per month and 2-4 bedroom apartments from $600 per month. For example, one consumer was told that a two bedroom apartment was available in Park Slope, Brooklyn for $900 per month, and another was told that a two bedroom apartment in Kew Gardens, Queens was available for $915.
During busy weeks, the group would sign up as many as 800 customers, taking in $140,000. As a way to dodge consumer complaints, the group operated under at least 12 different names, as well as a number of different addresses, over the past three years. Spitzer and Daniels' offices have received over 400 complaints about the businesses.
The defendants are charged with numerous counts of Scheme to Defraud, Petit Larceny, and Selling Apartment Information Without A License. If convicted, they face up to four years in prison.
The defendants were arrested this morning and are due to be arraigned this afternoon in Criminal Court in Manhattan.
Spitzer noted that in 1999, one of the defendants, Leroy Noel Cox, had agreed never again to act as an apartment information vendor in settlement of a civil case brought by his office.
The businesses operated by the defendants since 1998 are BROKER'S FREE, at 545 8th Avenue, NEW YORK NO FEE APARTMENTS, 129 West 27th Street, THE APARTMENT FINDERS, 224 West 35th Street, WORLD OF APARTMENTS, 171 West 29th Street, BROKER BYPASS, 1001 Avenue of the Americas, NYC NO FEE APTS, and COMPATIBLE ROOMMATES, 66 West 39th Street, R&R RENTALS, 171 West 29th Street, A FAST RENT, at 112 West 27th Street, EXPRESS RENTS INC., 112 West 27th Street, and SMART RENT and PLUS RENTALS, at 143 West 22nd Street.
Leroy Noel Cox : DOB 12-30-64
1123 E.73rd Street
Michael Adderly: DOB 11-18-75
869 Riverside Drive
N.Y. N.Y. 10032
Mekete Dawitt Melaku: DOB 5-18-77
2101 Bedford Ave.
Brooklyn, N.Y. 11216
Morsell Allison: DOB 1-29-77
869 Riverside Drive
N.Y. N.Y. 10032
Moyston Allison: DOB 5-31-78
264 Avenue O
Brooklyn, N.Y. 11230
In the separate, but similar civil case, Spitzer announced a lawsuit against Richard Wilson and nine of his companies, charging fraud and deceptive practices for an unlicenced apartment finder business that he runs.
Since at least February of 1999, Wilson, of 105th Avenue in Queens, charged consumers between $155-$195 for a membership in his apartment listing service. But once consumers paid Wilson, they either never received listings, received listings for apartments that were no longer available or listings for apartments that did not meet their requirements.
Spitzer this week obtained a temporary restraining order, signed by Manhattan State Supreme Court Justice Phyllis Gangel-Jacobs, preventing Wilson from operating any unlicenced apartment information vending business. The lawsuit seeks approximately $20,000 in restitution for victims, as well as civil penalties and costs to the state.
Wilson and his companies were the subject of over 100 consumer complaints. He targeted consumers in Queens, the Bronx and Long Island through newspaper ads.
"We believe that thousands of consumers have been victimized by these bogus apartment services," said Spitzer. "Consumers should always check to see whether these businesses are licensed by the state before turning over any money. With these prosecutions, we want to put these type of scam artists on notice that we will be vigilant when it comes to protecting consumers."
Current Wilson offices (note--all businesses are unlicenced)
E-Z Apartment Locators Publishing Corp.
376 Woodfield Road
West Hempstead, New York
Bronx Rental Locators Publishing Corp.
613 E. Fordham Road
Bronx, New York
Queens Rental Locators
237-33 Jamaica Avenue
Queens, New York
(QRL is an unincorporated company)
Taking part in the news conference were consumers Alicia Sheppard of the Bronx, and Angel Alicea, Jr. of Brooklyn.
The criminal cases are being prosecuted by Assistant Attorneys General Ronda Lustman of the Criminal Prosecutions Bureau and Jose Perez of the Consumer Frauds Bureau. Assistant Attorney General Roberto Lebron of the Harlem Regional Office is responsible for the civil litigation. The investigation was conducted for the New York Department of State by Litigation Counsel Laurence Soronen.
NOTE TO RADIO NEWSROOMS:
Audio cuts from today's news conference are available by contacting Brad Maione in the A.G.'s press office at (212) 416-8060.