Notorious Landlord, Raphael Toledano, To Pay $3 Million, Other Penalties For Harassing NY Tenants

Notorious Landlord, Raphael Toledano, to Pay $3 Million, Other Penalties for Harassing NY Tenants

Toledano settlement with Attorney General James will also include strong oversight and limitations over his real estate business

NEW YORK– Attorney General Letitia James today announced a settlement with Raphael Toledano to put an end to his harassment of New York City tenants and to prevent him from engaging in speculative real estate deals designed to profit by violating New York’s rent-stabilization laws.

“Access to safe, affordable housing is a right,” said Attorney General Letitia James. “Putting profits over people is unacceptable, and my office will hold any landlord accountable who violates the law to increase their bottom line. Under no circumstance should tenants be subjected to the harassment perpetrated by landlords like Raphael Toledano. We are grateful to our many partners, including the State Division of Housing and Community Renewal, who have worked tirelessly in the pursuit of justice in this case.”

Under the terms of the Consent Order (stipulation and judgement) being submitted to the Court, Toledano’s real estate business will be supervised by an Independent Monitor, who will ensure that Toledano ceases to engage in fraud and tenant harassment.  Toledano will not be allowed to have any direct contact with tenants, and will be required to hire an independent management company for any of his properties.  In addition, Toledano has agreed to pay $3 million in damages and penalties.  If Toledano violates the terms of his agreement, then Attorney General James will seek a lifetime bar against any further participation in the real estate industry, as well as a suspended judgment of $10 million.

Attorney General James and Governor Cuomo’s Tenant Protection Unit (TPU) within New York State Homes and Community Renewal began investigating Toledano after receiving complaints from tenants and community advocates about his use of harassment, unsafe construction, and other illegal conduct to push tenants out of their rent-stabilized homes. Since the creation of the Governor’s TPU in 2012, the unit has conducted multiple investigations and coordinated enforcement activities resulting in the registration of over 78,000 improperly deregulated apartments and the recovery of approximately $5 million in overcharged rent for unsuspecting tenants.

“This investigation builds on the joint successes of AG James and the Governor’s TPU in delivering justice on behalf of New Yorkers,” said New York State Homes and Community Renewal Commissioner RuthAnne Visnauskas. “These tenants were terrorized by Toledano’s pervasive threats, fraud and scheming which jeopardized their safety, and we recommit again today: We will not tolerate abuse of rent regulated tenants. We will protect tenants to the full extent of the law, as we are doing with the Zara investigation, Marolda investigation, and now the Toledano investigation.”

As set forth in the Complaint filed in New York Supreme Court, Attorney General James’ investigation established that Toledano engaged in a pattern of fraudulent and illegal conduct throughout his work as a landlord and real estate developer. He harassed tenants through coercive buyouts, illegal construction practices and failed to provide his rent-regulated tenants with utilities, repairs, and other necessary services. Toledano also engaged in deceptive business practices in his real estate transactions, including repeatedly and persistently misrepresenting himself as a lawyer and advertising apartments with 3 or 4 bedrooms, when legally the apartment could only have 1 or 2 bedrooms.

"Tenants Taking Control (formerly the Toledano Tenants Coalition) applauds the NYS Attorney General James’ Office for pursuing Raphael Toledano, and holding him accountable for the various injustices, offenses, mistreatment and at times barely believable disrespect that we received from him," said former Brookhill tenant Jim Markowich of East 5th Street. "We feel that he consciously and strategically tried to make our lives as his tenants unnecessarily upsetting and difficult. For example, there was sudden, unannounced, slap-dash demolition work that released elevated levels of lead dust into buildings where toddlers were living."

The case was brought to the Office of Attorney General James by Community Development Project and Cooper Square Committee. 

"Raphael Toledano wreaked havoc in the East Village, harassing tenants living in rent-stabilized apartments,” said Greg Baltz, Community Development Project.  “The Community Development Project’s clients, the members of Tenants Taking Control (formerly the Toledano Tenant Coalition), showed him and all of New York City that the most effective way to stand up to predatory landlords is to organize. We thank Attorney General James and her team for their fierce advocacy on behalf of tenants.”

"Rent-regulated tenants in Raphael Toledano's buildings faced intense displacement pressure, but many chose to stay and fight rather than accept buyout offers or succumb to the alleged harassment," said Liam Reilly, Housing Organizer, Cooper Square Committee. "The Toledano Tenants' Coalition (now known as Tenants Taking Control) is a prime example of the power of tenants when they stand together in defense of their rights, their homes, and their communities. Thanks to their resilience and creativity, in addition to the Attorney General's powerful investigation, we are hopeful that rent regulated tenants will no longer be subjected to Toledano's unscrupulous schemes." 

The matter is being handled for the Attorney General’s Bureau of Consumer Frauds and Protection by Assistant Attorneys General Elena González, Mark Ladov and Bureau Chief Jane M. Azia, and for the Attorney General’s Real Estate Finance Bureau by Chief of Enforcement Louis Solomon and Bureau Chief Brent Meltzer.  The Bureau of Consumer Frauds and Protection is overseen by Chief Deputy Attorney General for Economic Justice Christopher D’Angelo, and the Real Estate Finance Bureau is overseen by Chief Deputy Attorney General for Social Justice Meghan Faux.   

For the Tenant Protection Unit, the investigating attorneys are TPU Legal Director Argyro Boyle, Assistant Counsel Karis Rasmussen, and TPU Senior Attorney Jonathan O. Hurt, under the leadership of Commissioner RuthAnne Visnauskas and HCR Deputy Commissioner and TPU Bureau Chief Gregory C. Fewer.