Jared Kushner’s Company Routinely Filed False Documents
The family real estate business made tens of millions through shady dealings.
AP (“Kushner Cos. filed false documents with NYC“):
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.
“It’s bare-faced greed,” said Aaron Carr, founder of Housing Rights Initiative, a tenants’ rights watchdog that compiled the work permit application documents and shared them with The Associated Press. “The fact that the company was falsifying all these applications with the government shows a sordid attempt to avert accountability and get a rapid return on its investment.”
Kushner Cos. responded in a statement that it outsources the preparation of such documents to third parties that are reviewed by independent counsel, and “if mistakes or violations are identified, corrective action is taken immediately.”
“Kushner would never deny any tenant their due-process rights,” it said, adding that the company “has renovated thousands of apartments and developments with minimal complaints over the past 30 years.”
The story provides scant details and most of those are from the perspective of angry former tenants and HRI, neither of which are exactly unbiased sources. But the complaint seems valid because of this:
Rent stabilization is a fixture of New York City that can bedevil developers seeking to make money off buildings. To free themselves of its restrictions, landlords usually have to wait until the rent rises above $2,733 a month, something that can take years given the small increases allowed each year.
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.”
This seems, then, to be a rather common practice and one incentivized by the rules. Rent stabilization in NYC is legendary for its perversity. Well-intentioned though it may be, it creates a massive incentive for fraud on the part of all parties. Renters will do whatever they can to keep and pass along the advantages of rent that’s artificially low in a city where affordable housing is hard to come by. And landlords naturally want to do everything in their power to be able to turn over these places to get fair market value.
One presumes Jared Kushner was well aware of this practice and, indeed, likely inherited them from his father, Charles (a convicted criminal) when he inherited the business. And, of course, we know that Donald Trump’s real estate businesses routinely engaged in similarly shady conduct, taking advantage of rules that made recovering damages slow, tedious, and expensive.
A few years ago this would have been a blockbuster story that would have dominated the weekend. But with the sh*tstorm that is this administration, it barely registers a blip on the outrage meter.
1. Anyone who knows about Trump and Kushner from NYC know that neither of them can get any sort of funding or financing from mainstream US lenders. Furthermore, even most mainstream worldwide bankers won’t do business with either of them. Why? Because they’re over-leveraged.
2. Trump is no sort of billionaire. He’s rich, but he could be worth as little as $400-$500 million, which is a huge difference from the 10 Billion he claims. And that’s not a secret in the world of NYC finance.
3. Kushner idolizes his dad. His father is a convicted felon. Son will soon follow father to Federal Prison.
If anyone pursues this, or anything below this presumyive iceberg tip, it would seem to be a city or state deal. No fired investigators, no pardons.
Why am I not surprised?
Jared is the son of a well-known slumlord/felon.
@EddieInCA:
Exactly, that ‘red line’ he warned investigators to not cross, leads directly to his sham public representation of his wealth and “worth.”
This is more than landlords doing “everything in their power” — this is fraud, plainly and simply.
And this is why I support the death penalty for financial crimes. Seriously.
There’s a huge life expectancy difference between the middle class and the poor, and when you steal from people systematically, you’re cutting life expectancies. At some point, you have have cut 70 years of total life expectancy, and you’re a murderer who has just distributed the damage.
Millionaire execs at Wells Fargo conspired to rob several million people. I was one. Thanks to the Evil Big Gummint, in the end it didn’t hurt me. But plenty of times financial fraud ruins people’s lives. The 14 yro black kid in Detroit gets 5 years in prison for stealing an old buick, but the well-groomed, well-dressed millionaires do a thousand times more damage and usually get a smack on the wrist. There’s a reason the good lord invented pitchforks and torches, and complacent, resigned americans will rediscover them eventually.
Behind every great fortune there is a crime.
My late mother used to say this country would experience another revolution one day. With time, I have come to the same conclusion.
@Dave Schuler:
And all rising to great place is by a winding stair.
There was a long-form journalism that I read close to the election detailing scurrilous treatment of renters in Baltimore following the Kushner Co purchasing several apartment developments there. None of this is surprising of course.