Jared Kushner's company filed fake rent-control paperwork about its properties in order to turn a massive profit

At the same time they were declaring rent-controlled apartments to reduce their taxes.

https://www.businessinsider.com/jared-kushner-company-filed-fake-rent-controlled-paperwork-nyc-2018-3?fbclid=IwAR3PuP1-Nu3vkuMMPQw-gbKlrI01VkIxdabynNh6ZBi9NlwPY4TTsdwaEe8

Bernard Condon, Associated Press
Mar 18, 2018, 4:01 PM

When the Kushner Cos. bought three apartment buildings in a gentrifying neighborhood of Queens in 2015, most of the tenants were protected by special rules that prevent developers from pushing them out, raising rents and turning a tidy profit.

But that's exactly what the company then run by Jared Kushner did, and with remarkable speed. Two years later, it sold all three buildings for $60 million, nearly 50 percent more than it paid.

Now a clue has emerged as to how President Donald Trump's son-in-law's firm was able to move so fast: The Kushner Cos. routinely filed false paperwork with the city declaring it had zero rent-regulated tenants in dozens of buildings it owned across the city when, in fact, it had hundreds.

While none of the documents during a three-year period when Kushner was CEO bore his personal signature, they provide a window into the ethics of the business empire he ran before he went on to become one of the most trusted advisers to the president of the United States.

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Had the Kushner Cos. disclosed those rent-regulated tenants, it could have triggered stricter oversight of construction crews by the city, including possibly unscheduled "sweeps" on site by inspectors to keep the company from harassing tenants and getting them to leave.

Instead, current and former tenants of the Queens buildings told the AP that they were subjected to extensive construction, with banging, drilling, dust and leaking water that they believe were part of targeted harassment to get them to leave and clear the way for higher-paying renters.

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In Kushner buildings across the city, records show frequent complaints about construction going on early in the morning or late at night against the rules, improper or illegal construction, and work without a permit.

At a six-story walk-up in Manhattan's East Village that was once home to the Beat poet Allen Ginsberg, the Kushner Cos. filed an application to begin construction in late 2013 that, again, listed zero rent-regulated tenants. Tax records a few months later showed seven rent-regulated units.

"All of a sudden, there was drilling, drilling. ... You heard the drilling in the middle of night," said one of the rent-regulated tenants, Mary Ann Siwek, 67, who lives on Social Security payments and odd jobs. "There were rats coming in from the abandoned building next door. The hallways were always filled with lumber and sawdust and plaster."

A knock on the door came a few weeks later, and an offer of at least $10,000 if she agreed to leave the building.

"I know it's pretty horrible, but we can help you get out," Siwek recalls the man saying. "We can offer you money."

Siwek turned down the cash and sued instead. She said she won a year's worth of free rent and a new refrigerator.

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Submitting false documents to the city's Department of Buildings for construction permits is a misdemeanor, which can carry fines of up to $25,000. But real estate experts say it is often flouted with little to no consequences. Landlords who do so get off with no more than a demand from the city, sometimes a year or more later, to file an "amended" form with the correct numbers.

Housing Rights Initiative found the Kushner Cos. filed dozens of amended forms for the buildings mentioned in the documents, most of them a year to two later.

"There is a lack of tools to go after landlords who harass tenants, and there is a lack of enforcement," said Seth Miller, a real estate lawyer who used to work at a state housing agency overseeing rent regulations. Until officials inspect every construction site, "you're going to have this incentive for landlords to make life uncomfortable for tenants."

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Back in Queens, the mailman Romano was one of the few rent-regulated tenants who fought back.

He hired a lawyer who found out he was protected from the 60 percent rent hike by law, something Romano did not know at the time. And he said his rent, which was set to increase to $3,750, was restored to $2,350.

Romano is still in the building where he has lived for nine years, with his wife, four children and his guests from the construction days — the mice.

"I still haven't gotten rid of them."