Attorney General Letitia James and HCR re-regulate 21 apartments in East Harlem after investigation finds Emerald Equity illegally deregulated and overcharged tenants

New York – In a significant development for New York City’s housing landscape, Attorney General Letitia James and Homes and Community Renewal (HCR) Commissioner RuthAnne Visnauskas have announced the re-regulation of 21 apartments previously mismanaged by Emerald Equity Group, LLC. This move comes as a resolution to findings from a joint investigation by the Office of the Attorney General (OAG) and HCR, which revealed multiple violations of rent stabilization laws by the real estate company.

The investigation detailed that Emerald Equity Group had not only illegally deregulated rent-stabilized apartments but had also overcharged tenants and mishandled security deposits. These actions directly contravened New York’s Rent Stabilization Law, which is designed to protect tenants from unreasonable rent hikes and ensure their security deposits are held in separate accounts to avoid misuse.

Emerald, which owns a number of buildings in East Harlem, has been ordered to return these apartments to rent stabilization and correct the rents to their proper amounts. Furthermore, the company must refund a total of $54,799.66 to tenants who were overcharged. This settlement mandates compliance within strict deadlines: 21 improperly deregulated units must be returned to rent stabilization within 60 days, and any inflated rents corrected. The company has 30 days to inform all affected tenants and refund the excess charges.

Commissioner Visnauskas emphasized the broader impact of these enforcement actions, noting their role in preserving the integrity of New York’s housing market and safeguarding tenant rights. She highlighted the ongoing partnership with the Attorney General’s office as vital in combating unlawful practices in the real estate sector.

This case also sheds light on the financial struggles of Emerald, which has filed for bankruptcy for several of its properties. During these proceedings, discrepancies were discovered in the registered rents of at least 20 units, necessitating further rent adjustments.

The properties involved, which include multiple addresses on West 107th Street and East 117th Street as well as 1661 Park Avenue, are currently under bankruptcy protection and are expected to be transferred to Emerald’s lender. An agreement with the lender ensures that the new owners will also adhere to the settlement terms regarding rent regulation and security deposit management.

This enforcement action is part of Attorney General James’ broader effort to uphold housing laws and protect tenants. Her office has a history of taking robust action against landlords who flout the laws, including re-regulating hundreds of apartments and securing significant financial settlements from landlords engaged in illegal activities. These ongoing efforts underscore the commitment of New York’s legal and regulatory bodies to maintaining fair and lawful housing practices across the city.