July 12, 2024

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He Runs a New York Actual Estate Empire. Did He Steal It?

He Runs a New York Actual Estate Empire. Did He Steal It?

Above the past dozen a long time, Sanford Solny has designed a New York serious estate empire, snatching up compact residential structures across the town that churn out hundreds of thousands of bucks in hire.

His portfolio would be enviable but for one point — substantially of it, prosecutors and house owners contend, was stolen. In felony costs and lawsuits, they have accused him of fraud: presenting to enable householders experiencing foreclosure by arranging to pay out off their home loans, even though really tricking them into signing above their structures at cut price-basement selling prices. In virtually just about every scenario, the home loan was by no means paid out, leaving the property owner with no home but a pile of credit card debt.

The practice is recognised as deed theft, and as metropolis and condition officers promised to crack down on it, they homed in on Mr. Solny. The Brooklyn district legal professional, whose business office has charged him with getting the homes of seven people, identified as his conduct “despicable.” In Queens, prosecutors accused Mr. Solny and his associates of dishonest 10 persons out of their properties. The court docket appointed a monitor to scrutinize his transactions.

But an examination by The New York Situations has discovered that not only is Mr. Solny even now profiting from buildings less than dispute, city businesses are contributing to his earnings by subsidizing the rent at some of his properties.

His circumstance exemplifies the gradual and stumbling struggle from deed theft, which normally targets immigrants and Black and Latino home owners. Irrespective of repeated pledges from the New York State legal professional normal and legislature to curtail the fraud, only a small fraction of countless numbers of problems are ever prosecuted. House owners, stripped of their most significant asset, are still left to interact in a lengthy and high priced combat to try to reclaim their attributes in civil courtroom.

A close assessment of Mr. Solny’s holdings and transactions — drawing on housing court situations, lawsuits, metropolis property documents and interviews — reveals a extensive history of questionable dealings and a largely ineffective federal government reaction. In excess of extra than a 10 years, Mr. Solny and corporations joined to him took ownership of at minimum 140 properties, The Situations observed. The previous owners of 40 of those people buildings — which include things like a coveted brownstone in gentrifying Bedford-Stuyvesant, Brooklyn, a 3-tale apartment constructing near Rockaway Beach front and a suburban Craftsman-model house with a lawn in Rosedale, Queens — have claimed they ended up victims of deed theft, civil and felony court docket records demonstrate.

Even while Mr. Solny was beneath the eye of the check, a company controlled by him paid a Brooklyn girl $5,000 for a dwelling worthy of about 100 instances that considerably and left her family with the personal debt, in accordance to the lady and town residence documents.

As a result of a net of shell organizations, Mr. Solny even now owns 19 houses whose owners he has been accused of defrauding, and he collects lease from tenants he installed in many of them, in accordance to court docket filings, town records and interviews. As prison expenses in opposition to Mr. Solny have piled up, city businesses have paid the rent of tenants at some of individuals properties by way of very affordable-housing vouchers, The Instances located.

“How does the system do the job for him and not for us?” said Janet Bruce, a retired residence health aide from Guyana who explained in court filings that Mr. Solny walked into her house in Flatbush, Brooklyn, in 2014 with a stack of paper and a promise to rescue her and her spouse from foreclosures. He gave the couple $14,000 but never ever paid off their home loan, she explained.

He walked out as the operator of a creating now really worth about $900,000, claimed Ms. Bruce, 69, who has sued Mr. Solny. The transaction is also aspect of the felony situation in Brooklyn.

From July 2014 by way of February of this calendar year, there have been more than 3,350 problems of deed theft in New York Metropolis, just about 50 percent of which were being in Brooklyn, in accordance to the city Office of Finance. The Brooklyn district attorney’s office brought expenses in 27 conditions of deed theft due to the fact 2014, in accordance to a Occasions review.

“It just can make you question how very seriously we, as a society, and our felony justice system, consider white-collar crime that actually victimizes individuals,” reported Oda Friedheim, a supervising lawyer at the Legal Assist Culture who deals with property fraud.

A attorney for Mr. Solny declined to response specific inquiries from The Situations, citing the open up criminal scenario in Brooklyn.

“The fact that these consumers would shed their properties had been a foregone summary extended in advance of they at any time fulfilled Mr. Solny,” the attorney, Michael Farkas, explained in a assertion. “When they sought his guidance with controlling that regrettable and complicated actuality, these clientele executed files that clearly conveyed their attributes to Mr. Solny.”

Deed fraud problems in New York City have fallen from a peak of 665 in 2015 to 154 last year. But individuals numbers mask what could be a looming surge now that protections from foreclosure that ended up set in put through the pandemic have expired.

“You have a very significant selection of property owners that are in distress, and authentic estate in New York has by no means been more beneficial,” reported Ivy Perez, the senior coverage and exploration manager for the Centre for NYC Neighborhoods, an cost-effective-housing nonprofit. “That is a potent blend for scammers.”

Deed theft usually takes different varieties, but Mr. Solny is accused of 1 of the most popular.

The fraud preys on persons who are in danger of getting rid of their households, facts that is easily obtainable in real estate databases. Some purchasers also recruit local people to obtain people today they know who are in financial difficulty.

House owners are advised they qualify for a small sale — a deal in which the loan company settles for significantly less than the volume owed on the mortgage loan. The proprietors, presently resigned to dropping their attributes to foreclosures and perplexed by a mountain of paperwork, believe the offer will at least decrease them of their debt and give them a compact total of hard cash.

In truth, the files they sign transfer ownership of the building whilst continue to leaving the householders accountable for the financial debt. The man or woman committing the fraud delivers in tenants and collects rent, from time to time for several years, until finally banking institutions or other creditors at last foreclose on the assets.

Ms. Bruce fell driving on her house loan payments in 2013, immediately after her partner, James, a strategy examiner for the Section of Properties, had a stroke.

A good friend from church referred Ms. Bruce to Mr. Solny, who said he could assist set up a short sale. Mr. Solny explained to her she would lose the household but the home finance loan would be compensated, and he would get treatment of almost everything as her law firm, she said in her lawsuit.

Mr. Solny and his associates arrived late, Ms. Bruce explained, and then rushed her and her spouse to indicator documents in independent rooms. He paid out them every single $7,000, according to the complaint.

No shorter-sale try was designed, she said, but a deed transferring the assets to East 29th Avenue Realty Inc. was recorded with the metropolis, records clearly show. Mr. Solny signed as the customer, and his daughter, Shandelle Solny, signed as a witness. For a long time, for the reason that of assurances from Mr. Solny, Ms. Bruce did not comprehend that the increasing debt would continue being in her name, she claimed. She owes roughly $350,000 — a financial debt she could shell out, with dollars to spare, if she had been ready to provide or refinance the property.

Mr. Solny set up tenants shortly immediately after the few moved out and has gathered extra than $200,000 from the creating, in accordance to Monthly bill Lienhard, a lawyer for Ms. Bruce. Two recent tenants confirmed to The Periods that they paid out hire to a firm managed by Mr. Solny.

“He collects hire until eventually the foreclosure is performed, and then he’s out — what does he treatment?” claimed Toby Cohen, an additional law firm who has represented numerous men and women suing Mr. Solny.

Prosecutors say they are hamstrung by the regulation: They have to exhibit there was legal intent in instances that are not as slam-dunk as people they prefer to bring to court docket. A long time can go by in advance of a home-owner realizes what occurred, and the transactions are difficult. What one particular person promises as fraud can be defended as just a lopsided business deal.

“Deed theft is notoriously complicated to look into and prosecute,” explained Melinda Katz, the Queens district lawyer. The sentiment was echoed by Eric Gonzalez, the Brooklyn district legal professional.

Civil lawsuits are generally the only way a home owner can consider to reclaim a title, and victims typically can not manage a attorney. The plaintiffs not often gain — properties once owned by quite a few of Mr. Cohen’s clientele ended up sold at foreclosure auctions to other parties ahead of the scenarios could be settled.

Litigation is difficult by a net of shell companies managed by Mr. Solny and customers of his household. Of the 140 transactions The Instances joined to Mr. Solny, none was personally deeded to him. Alternatively, he signed as an officer of a company entity that assumed possession.

“We dropped almost everything,” Ms. Bruce explained, recalling a period when she slept on friends’ couches and still left New York for cheaper housing in Philadelphia. Her spouse died in 2020. “Do you know how challenging it is to be finding up the items when you are in your senior decades?”

Owners are not the only types impacted. Tenants and metropolis organizations have complained of serious basic safety and health hazards at structures owned by corporations joined to Mr. Solny.

Of the 19 disputed qualities these providers continue to owned as of June, 15 experienced open up housing violations, together with for warmth and scorching-drinking water failures, unsafe wiring and pest infestations.

“They’re not executing almost nothing — never have heating, never ever correct practically nothing,” said Sandy Triunfel, a household attendant who in 2017 stopped spending rent on her apartment in Crown Heights, Brooklyn, according to court records, simply because she claimed she did not receive incredibly hot drinking water or fuel for months.

The owner, Blue Realty & Solutions Group, a firm tied to Mr. Solny, evicted her the upcoming year. The past house owner had claimed in civil court that the corporation had tricked him into signing around the deed to the household.

At Ms. Bruce’s former dwelling, metropolis inspectors identified almost 4 dozen guide paint violations in February 2019, when a mom and her 8 little ones were being dwelling there. Right after the tenants applied for emergency rental support, the metropolis paid around $21,000 in back rent to Mr. Solny’s firm. Two current tenants mentioned the metropolis was however spending some of their lease by means of subsidies.

It was a single of 3 disputed qualities exactly where The Periods located the town experienced lined the hire for Mr. Solny’s tenants. The New York Town Housing Authority, which compensated subsidies at one particular of the houses, stated it experienced since included Mr. Solny’s enterprise to a list of banned landlords.

Neha Sharma, a spokeswoman for the metropolis Department of Social Providers, which administers the rent aid software at the other two structures, explained the agency’s precedence was to maintain housing steadiness for tenants.

Mr. Solny, 65, who is recognized as Sandy, has been on the city’s radar for decades.

In 2012, he was suspended from training regulation for pilfering $600,000 from his dying uncle, according to a disciplinary board selection. He paid out back the dollars but remains suspended.

The subsequent calendar year, Mr. Solny and his daughter went on a obtaining spree: at minimum 50 properties in Queens, Brooklyn and the Bronx, numerous of which were in or approaching foreclosure. On a solitary day in March 2013, they signed the deeds to three homes in East New York, a predominantly Black neighborhood in Brooklyn, according to metropolis records.

Tenants and owners explained him as cordial, with a delicate voice and grandfatherly mien.

“He’s incredibly slick,” mentioned Richard Severe, who sued a enterprise managed by Mr. Solny in 2015 for boasting the title to his two-household property in East New York. The case is open.

In 2016, Mr. Solny and his associates were being billed in Queens with crimes similar to the theft of 10 houses. He pleaded responsible two several years afterwards to a lesser charge of legal possession of stolen house and was sentenced to up to five a long time of probation.

Mr. Solny compensated a high-quality and returned lease he experienced gathered, and five deeds ended up voided as a consequence of the offer. His daughter, Shandelle, 31, was billed with tax fraud and paid restitution in a plea deal. Ms. Solny declined to remark past the assertion issued by her father’s law firm.

In 2020, Brooklyn prosecutors charged Mr. Solny with crimes related to the theft of 8 homes. Next the indictment, Mr. Solny’s probation officer advisable that he be sentenced to prison for violating the conditions of his plea offer in Queens. A verdict has not nonetheless been reached in the Brooklyn case.

The Queens deal did not bar Mr. Solny from shopping for additional true estate, but the courtroom appointed a check in 2018 to overview his small business specials heading forward and flag any suspicious transactions.

In a overview of property information, The Moments observed a questionable transaction conducted following Mr. Solny’s plea in Queens.

Elizabeth Lewis, 77, a retired bank worker, advised The Periods that in late 2019, Mr. Solny made available to arrange a quick sale on a Brooklyn property, a two-bedroom brick property in East Flatbush belonging to Ms. Lewis’s sister, who experienced a reverse house loan and other financial debt.

Ms. Lewis said she signed paperwork on behalf of her sister, who died in 2020, to initiate a sale. The deed recorded the sale at $35,000, but Ms. Lewis said she was compensated $5,000 with the assure of far more when the house was marketed.

She signed around the deed to a business controlled by Mr. Solny, but the credit card debt was not paid, in accordance to home data and the Office of Housing and City Improvement, which holds the financial loan.

Comparable profits present the house is almost certainly truly worth far more than $500,000, but Ms. Lewis can no more time offer it because Mr. Solny’s enterprise is listed with the city as the operator.

She has not listened to from Mr. Solny in practically two decades, she stated.

Brian Sanvidge, who has overseen the review of Mr. Solny’s transactions at Anchin, the checking organization, reported that he had looked at more than 240 homes related to Mr. Solny and experienced not caught the East Flatbush sale. He termed it “concerning” and claimed he would report it to the Queens district legal professional.

Public efforts have been produced to counter assets fraud, but critics say the steps tumble quick.

The condition lawyer general’s place of work introduced a marketing campaign to struggle deed theft in 2020, funding cost-free authorized services and mortgage loan guidance in neighborhoods vulnerable to fraud. But reduction for all those who have currently shed their properties can be hard to get: The business office is at this time prosecuting just a few deed theft situations.

A state regulation passed in 2019 included a rule that lets prosecutors to file a movement to void a fraudulent house transfer in link with a guilty plea or verdict.

But the rule is narrowly outlined, limiting its use, and the method can however get a long time, said Rachel Geballe, a deputy director at Brooklyn Lawful Services. Neither Queens nor Brooklyn prosecutors have utilized the mechanism, even though the places of work mentioned they experienced utilised other usually means to void fraudulent deeds.

For Ms. Bruce, 8 decades have handed considering the fact that she signed her household in excess of to Mr. Solny’s firm. The Brooklyn felony circumstance has been adjourned 13 times considering the fact that late 2020. Mr. Farkas mentioned in court in June that his shopper was considering a plea deal.

“I’m hoping some form of justice will appear from this,” Ms. Bruce claimed. “I say, ‘Lord, when is this heading to be above?’”

Susan Beachy contributed study.