Mayor Zohran Mamdani on Friday established the Office of Deed Theft Prevention and named a longtime homeowner assistance lawyer as its director.

Peter White, an attorney who has worked on deed theft litigation, foreclosures, bankruptcy and landlord-tenant disputes, will helm the new office. He most recently worked as a supervising attorney at Access Justice Brooklyn, a nonprofit that provides pro bono legal services to low-income residents.

“The establishment of this office and the work going forward is an act of empathy for people,” White said. “I see it as a direct correlation and an extension of the work that I’ve previously done. I’m excited to get this going.”

Deed theft — often made through forged documents, short sales and foreclosure rescue scams — can strip families of generational wealth, ripping away what can be their most valuable asset.

“The theft of a home is the theft of a family’s future,” Mamdani said in a statement. “Deed theft preys on the New Yorkers who can least afford it. Today, we are bringing the full force of city government to bear to stop it – to protect homeowners, defend generational wealth and make clear that this city will not tolerate the exploitation of our communities.”

The Wednesday arrest of Councilmember Chi Ossé (D-Brooklyn), as he attempted to prevent the eviction of a grandmother from a Bedford-Stuyvesant brownstone, thrust deed theft in New York City into the national spotlight.

The Brooklyn resident, Carmella Charrington, as well local activists who have rallied to her cause, has said that her eviction is the result of deed theft. Public records point to a more complicated story, one involving an older relative in a conservatorship in Georgia and competing claims about the sale of the home. 

The state Attorney General’s office said it had determined the situation was not deed theft, but rather a property dispute. 

Either way, Ossé said he expected the new Office of Deed Theft Prevention to be able to provide clarity, even in murky cases like Charrington’s.

“Having a dedicated office that is creating awareness and educating people will help them figure out if they’re dealing with deed theft or not, or point them in the right direction to seek help even if they’re not dealing with deed theft,” Ossé told THE CITY. 

Ossé’s district, which includes Bed-Stuy and Crown Heights, is one of several historically Black areas around the city with rising property values where deed theft and other predatory real estate speculation run rampant. 

“It’s patently unfair,” White said of what he described as economic and racial targeting that can drive families of color out of the city. “I want to help stop it.”

White said his office will be a place people can turn to even if they aren’t sure what’s going on with their property so that he can do a “deep dive on their individual case” to ascertain what’s happening — and then take action from there.

The Office of Deed Theft Prevention will be housed within the Department of Finance, working closely with other agencies like the Department of Housing Preservation and Development, the Department of Consumer and Worker Protection and the Commission on Human Rights.

The office will advance a three-pronged strategy for addressing deed theft: catching it early, educating homeowners about the risks and getting people’s homes back, according to White.

It’s uncertain whether or not the office will actually be able to enforce current laws, White said, but it will coordinate with the Attorney General’s office and district attorneys to get them to take on cases. He will also attempt to bring in pro bono attorneys to help homeowners.

As a candidate, Mamdani promised to create an Office of Deed Theft Prevention to “protect homeowners from scam artists” and fund it to the tune of $10 million. 

The mayor’s preliminary budget allocates $500,000 to the office in the current fiscal year and $1 million for the years after.

It is unclear how many dedicated staff the office will have other than White. Mamdani’s executive order creating the office also names a position for a deed theft prevention advocate.

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A crowd of people came out in Bedford-Stuyvesant Monday to talk about a pernicious issue in the neighborhood: property fraud, deed theft and predatory real estate speculation.

THE CITY newsroom, which has completed many investigations on the topic, led a community conversation, hosted by JPMorgan Chase at their Brooklyn Community Banking Branch in Bed-Stuy, with experts who help New Yorkers grapple with the problem every day.

Marco Villegas, program officer for global philanthropy at JPMorgan Chase, said Bed-Stuy may be the epicenter of speculators trying to wrongfully get their hands on property in New York City — if not the entire United States.

The red flags for New Yorkers to watch for are numerous. Scott Kohanowski, general counsel for the Center for NYC Neighborhoods, said he’s worked with clients who have been approached by scammers through social media, family members and even their church communities.

Kim Allman, interim executive director of Abode Alliance, told attendees unequivocally: find trusted legal help, and keep in mind that not all attorneys are created equal. Your uncle with a law degree doesn’t necessarily know about the complexities of estate or property law.

Attendees were invited to ask questions and share their stories in an off-the-record conversation with the panelists.

The conversation was moderated by Rachel Holliday Smith, managing editor at THE CITY, which has published numerous stories about property-related fraud and patterns of real estate speculation. Those include our award-winning Deed Finders series, which documents how speculators scoop up shares from unsuspecting heirs in a scheme that’s destroying generational wealth in the city’s Black and Latino neighborhoods.

More recently, THE CITY published an investigation of the secretive family who grabbed buildings from immigrant owners across Brooklyn, including the site of the beloved Sherita billboard on Atlantic Avenue.

JPMorgan Chase is a sponsor of THE CITY’s independent journalism, including this series of community conversations hosted at Chase’s community bank branches throughout New York City.

Our nonprofit newsroom relies on donations from readers to sustain our local reporting and keep it free for all New Yorkers. Donate to THE CITY today.

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Owning a home in this city is a serious achievement and a valuable asset often built up over years. But losing control of it can happen in a New York minute.

Over the last few years, THE CITY has reported extensively on cases of deed theft and scams — unscrupulous moves where people use fraud, forgery and other unlawful methods to take possession of a home, often without the true owner even knowing.

Straight theft is illegal. But there are other, mostly legal, ways property speculators scoop up deeds that New Yorkers should know about, too.

These practices often impact the city’s Black and Latino communities the most, many of which have seen their homes’ worth rise significantly in recent years.. 

In this guide, we’ll help you understand how deed fraud works, what’s legal and illegal — and how to take precautions to protect yourself either way:

What is deed theft?

Deed theft is when someone takes over the title of a home — represented by a physical deed document — without the approval or knowledge of the true homeowner. 

That’s what happened to Johnnie Jackson, as previously reported by THE CITY. Jackson, 64, lived in his family’s three-story house in St. Albans, Queens for most of his life. Then, in 2010, he went to refinance his mortgage through low-rate ads he saw in a newspaper.

But that refinancing company turned out to be part of a federally-investigated scheme to defraud homeowners, according to federal court documents from 2015. Jackson had signed away the rights to this house thinking that they were paperwork for refinancing.

The New York City Sheriff’s office received nearly 3,500 complaints of deed theft between 2014 and mid-2023, according to the attorney general’s office.

Property ownership-related fraud goes beyond just theft of a deed. Criminals could record fraudulent deeds, mortgage records or liens (a document indicating owed debt) on a property without an owner knowing about it. Those situations may be called deed fraud, according to the NYC Department of Finance.

That’s what may have happened in Harlem, where Joseph Makhani was indicted by the attorney general last year for allegedly forging documents claiming he had bought two brownstones worth millions for just $10 each.

New York City has a deadly combination of factors that make deed fraud and theft “particularly pernicious,” said Jacob Inwald, the director of litigation at Legal Services NYC.

“There is a significant population of homeowners at risk of losing their homes due to foreclosures or property taxes, combined with exponentially increasing property values,” he said.

Who is most at risk for deed fraud or theft?

THE CITY has found that speculators in the five boroughs often target homes in rapidly gentrifying historically Black and Latino neighborhoods. Other vulnerable groups include older people and families with no estate plan or will. 

Studies show that only about a third of Americans have a will, with Black and Latino people significantly less likely than white people to lock in formal estate planning. That reality means that scores of family homes in nonwhite neighborhoods are prime targets for speculators looking to cash in.

Another group at risk, according to the state attorney general, are people struggling to make payments on their mortgages. Currently, the city Department of Finance puts liens on properties for unpaid property taxes and sells them to privately managed trusts, which can attempt to collect the debt and initiate foreclosure proceedings.

What can I do if I think I’m the victim of deed fraud?

If you think you are the victim of deed fraud or theft, immediately report it to the Sheriff’s Office — at (718) 707-2100 or online — and to the district attorney in the borough where your property is located. You can also call the office of the state attorney general at (800) 771-7755 or by filing a complaint online. 

You should also get your own lawyer, according to the attorney general. But beware of hiring a lawyer referred to you by someone who may have a vested interest in your property, the office notes, including realtors. You can also get legal representation through programs such as the Homeowner Protection Program (HOPP), a network of housing counselors and legal service providers throughout New York State.

According to Inwald at Legal Services NYC, one of the most important factors in these cases is timing, as it often takes years for people to even realize that there is something wrong with the deed of their house. The statute of limitations — meaning the legal timeframe in which a crime can be prosecuted — for the criminal prosecution of deed theft recently changed from five years to eight.  

How can I prevent deed fraud or theft from happening to me?

There are several key steps you should take that can help protect you from future fraud or theft, according to experts:

1. Sign up for the Notice of Recorded Document Program through the city Department of Finance, which automatically notifies you by mail when a new record is filed on your property.
2. Check your property’s deed on the Automated City Register Information System (ACRIS) at least once a year to make sure no fake or fraudulent documents have been recorded there.
3. Keep your records safe. Make copies and keep all of your important documents and a list of your heirs — with their names, contact information and addresses — in a secure spot. Make sure those you trust know where to find them.
4. Never transfer ownership of your property, including to organizations like mortgage assistance companies. Trustworthy people or businesses will not ask you to transfer your property rights to them.
5. Be skeptical about online ads, phone solicitations, or visits from strangers who promise mortgage modifications or to save your home from foreclosures.
6. Have a will. It is the easiest way to transfer the title of your home after your death.
7. Do not abandon your property or stop mortgage payments, property tax payments, or water bills, as this is a common way would-be deed thieves find targets. If you are struggling to make payments, get in touch with the Homeowner Protection Program (HOPP), sponsored by the state attorney general’s office, and they can help you connect with housing counseling agencies as well as legal services.

How can I get legal help to make a will or estate plan?

Not everyone absolutely needs a will or trust — direct heir and spousal inheritance is often covered by default estate law — but determining whether you do is something you may need an attorney to figure out. There are many local groups who provide free legal services to help low- or moderate-income New Yorkers sort out end-of-life planning, including:

• City Bar Justice Center, Planning and Estates Law Project | 212-382-6756
• Legal Services NYC | 917-661-4500
• NY Legal Assistance Group, Advance Planning  | 212-613-6514
• Center for NYC Neighborhoods Homeowner Hub  | 646-786-0888

Time is of the essence, experts say. If your relative on the title of a property has passed away, do not delay in seeking legal help, said Scott Kohanowski, general counsel for Center for NYC Neighborhoods.

Never sign anything without a lawyer’s review. Kohanowski stressed that property speculators are cunning and persistent, and will pressure you to sign documents you may not understand. Do not sign anything without consulting trusted legal counsel.

Be aware: Deed partition actions.

Here’s one more thing to keep in mind: A deed may be shared among those who own a property, including between spouses or relatives, or even when friends live together. It can also be shared when a property owner dies and leaves fractional stakes of the home to living relatives. 

Things get complicated if there’s a dispute among those who share ownership of a deed. They may resolve that argument with a partition action — where one owner goes to court to force a sale of the property.

The process of partitioning is perfectly legal. But where it can get tricky for inheritors is when speculators buy those fractional deeds for under-market value. Then, they often will use those fractions of ownership to force the other stakeholders to sell their shares — either by buying them out, or taking them to Housing Court to force a sale.

THE CITY has reported on this practice in our “Deed Finders” series. Since then, Albany lawmakers have made it harder for real estate speculators to force a homeowner into selling their home. 

Under a law change in 2024, only those who inherit property can initiate a partition action in court, not real estate investors who purchase shares of property from heirs.

The state has also implemented what’s known as a “transfer on death deed,” a simpler means of estate planning by which a property owner can specify just one person to inherit their property to avoid confusion. This may help heirs avoid Surrogate’s Court. 

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Tweaks in a state law guiding how property gets divided after its owner dies stand to make a big difference for heirs whose family homes are targets for predatory real estate speculators.

The changes to New York’s 2019 Uniform Partition of Heirs Property Act went into effect Friday and were prompted by an investigative series from THE CITY that featured family members who found themselves dispossessed from their own homes after investors forced a sale.

One heir whose fate may be brighter thanks to the revamped law is Mae Lee Massey, who grew up in a two-story brick row home with a front porch in The Bronx. She remembered the neighborhood, Baychester, as quiet and filled with other children to play with. Massey moved out when she turned 19 and eventually settled down in Parkchester with her husband, but visited her parents often.

After her parents died, she inherited the house — so did a man she didn’t know well and who was not related to her. He had rented a bedroom in the house for over 20 years and eventually had a relationship with her mother, she said.

Massey, 67, said that her mother wanted the house to be sold upon her death, which was in 2001. She hired lawyers and tried to negotiate with the man so she could put the house on the market, but he did not agree to sell his share to her.

That man died in 2007. A dozen years later, a company called US Asset Partners 1 LLC purchased his share of the home, a 50% stake, from his daughter for $5,000.

Massey found out about this about three years later, when she looked into unpaid property tax and water bills on the house. At that point, she’d been living in the house for over a decade, having moved with her husband and sons from their rental in Parkchester. Her husband, the family’s breadwinner, was out of work and fighting cancer. She couldn’t afford the rent on her own.

“I would love to keep the house,” Massey said. “I would love to fix the house up from top to bottom and pay off the bills and things like that.”

But the future of her home is up in the air, since she only owns half of it. Hanging over her head — until Friday — was the possibility that the LLC could go to court to demand a forced sale of the house, a move that could have pushed out family members who still live there.

The LLC never went to court to demand a sale of the home, and now it won’t have the chance, thanks to the new amendments, which passed in April as part of the state budget.

The amendments aim to tamp down on a business model used by real estate speculators who hunt for vulnerable properties — owned by homeowners who died without wills, or with a scattered network of heirs. The speculators purchase shares — typically for well below market value — from heirs who inherited the property and may have no idea of the worth of the homes, which are often located in gentrifying, historically Black and Latino neighborhoods. 

The speculators could then go to court and force a sale of the property, called a partition action, or insist on being paid handsomely in exchange for their shares. 

But under the revamped law, only those who inherit property can initiate a partition action in court — and real estate investors who purchase shares of property from heirs cannot. 

“We just want to discourage this predatory activity,” said K. Scott Kohanowski, general counsel at the Center for NYC Neighborhoods, who helped develop the law and its amendments. “This should put a huge damper on the industry that engages in this.”

Of course, predation is still a risk if homeowners or speculators are not aware of the provisions of the law.

“It’s partially on the courts, it’s partially on the lawyers who are representing the investors to be aware of this law,” Kohanowski added.

For Massey, pro bono lawyers and the City Bar Justice Center have been trying to work out a resolution so that she can keep her home. Michael Romano, a lawyer representing the LLC, said the parties are finalizing details of an agreement but declined to comment further.

New Rules

Under the old law, heirs who live in the property have priority over other parties to purchase the other shareholders’ stakes. The court had to look at how any late-arriving partial interest was acquired, and if the court determined the property should be sold, the transaction had to be handled through a third-party broker appointed by the court. 

But previously, anyone with any fractional interest in a property could initiate a partition action. That means they could go to court and demand that a judge order the property’s sale, with the proceeds split proportionally among the recognized shareholders. The investors would profit after paying well below what their shares were worth and those living in the property would likely lose their home.

The law now bans such maneuvers. Those investors may keep their shares, but can’t use the courts to divest the property from the family members.

Edward Mostoller, director of the Homeowner Stability Project at the City Bar Justice Center, called the amendments to the law “a game-changer” that could help preserve generational wealth, especially for Black and brown families.

What’s more, if an heir gets an outside offer, the other heirs have a right to purchase that share of the property for the same price. This is meant to keep properties — and the wealth that comes with it — within a family. And heirs who live in the property get priority to purchase, so that they’re less likely to be displaced from their homes.

The person making the offer and the heir who initially received it must notify other heirs, who then have six months to match the offer if they want to purchase the shares.

If the heirs aren’t notified and the investor didn’t do due diligence to get in touch, but the sale still goes through, the other heirs may buy the shares for the price paid by the investors within six months after they’re made aware of the sale.

And even then, if the heirs living in the property don’t have the financial means to purchase the shares held by other heirs, they may be able to get a loan through Sustainable Neighborhoods, a subsidiary of the Center for NYC Neighborhoods. Property owners and heirs of properties caught up in a complicated situation can also contact the Center’s Homeowner Hub for free legal services.

Others around the country are eyeing the changes to New York’s law to understand whether they could apply elsewhere.

Conner Bailey, a professor emeritus of rural sociology at Auburn University who studies heirs’ property in the south, said the provisions New York adopted could also apply to Alabama, where it’s typically farmland, not houses, that is passed down throughout generations to multiple heirs.

The changes to the law “are very explicitly to keep developers at arm’s length,” he said. “This provides an opportunity for the families to make a considered decision and mobilize the resources if they want to retain the land or the property.”

Other Efforts

The changes to the Uniform Partition of Heirs Property Act are just one way lawmakers tried to tackle the loss of generational wealth through predatory real estate practices.

As part of the budget, the state also implemented what’s known as a transfer on death deed, which can simplify estate planning and avoid Surrogate’s court. The deed transfers a property to at least one specific person upon the owner’s demise. 

Another change in the law made deed theft — taking the title of a home  without the approval or knowledge of the homeowner — a crime, and the state attorney general may now prosecute it without a referral.

At the city level, the Council in its budget included $1 million for legal assistance and estate planning services to protect the generational wealth of low-income homeowners and their heirs. 

In the meantime, Massey is hoping for the best outcome for herself: that she’ll own the house outright and see an end to the uncertainty of sharing ownership with a company.

That house is where her mother passed away at age 96, and, over a decade later, where her husband took his last breath before he died of cancer. It’s where she continues to care for her 24-year-old son, who has autism. And it’s where she hopes to live out the rest of her days.

“I’m not a spring chicken anymore. I’m getting older. I’ve been fighting for this house ever since I was in my 40s,” she said. “Either it’s going to be an asset or it’s going to be a liability. So far, it’s been a hill to climb.”

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Council Speaker Adrienne Adams in her State of the City speech on Wednesday will announce efforts to protect homeowners from predatory real estate speculation, according to her office.

Forthcoming proposed legislation will seek to inform homeowners and those who inherit property of the fair market value of their homes and help them protect their assets through a new assistance program. Details of the efforts have yet to be hammered out.

The planned measures come in response to an investigative series from THE CITY detailing how real estate speculators target properties in New York’s gentrifying, historically Black and Latino neighborhoods, typically owned by homeowners who died without wills. The speculators find property that legally belongs to a patchwork of far-flung heirs who may have no idea of the worth of their fractional shares of the property they inherited.

Speculators may low-ball heirs for their shares and then, under state law, can go to court to demand a forced sale of the house, which in turn may push out family members who still live there. Or, speculators can attempt to acquire the full property through multiple fractional shares — allowing them to evict longtime tenants and flip the property for many times what they paid.

Such practices can siphon off considerable generational wealth from Black and Latino families and have contributed to New Yorkers of color leaving the city.

Protecting Assets

One piece of legislation Speaker Adams envisions would require housing speculators to disclose the fair market value of properties to owners, in an effort to prevent unsuspecting heirs from accepting low-balled offers.

THE CITY’s reporting showed that real estate investors often approach distant heirs with offers to buy the heirs’ shares of property, but heirs don’t always know that those offers could be for far less than their market value. Some of the heirs who agreed to sell their holdings told THE CITY they had no idea they were getting a raw deal, and said they felt cheated to learn the speculators flipped properties for several times what they had paid.

The Council has yet to detail how this disclosure would work, including when in the process the fair market value would be determined and by what method. 

Property owners already receive some disclosures, but these can be misleading. The “total assessed value,” which is used to calculate property taxes, appears on a state form included in deed transfer paperwork. But that figure is typically much lower than what the property would sell for.

Another bill would require the city Department of Consumer and Worker Protection to develop a program to help New Yorkers manage an inherited property and protect their assets. This program would assist people who inherit property in making the decision about whether or not to sell and offer guidance in navigating tenant agreements, property taxes and other processes.

In addition to the legislation, the Council plans to host district-based events offering free legal services to older homeowners to help them prepare wills and work on other aspects of real estate planning. These events will be held in partnership with community organizations and local law schools, specifically focusing on neighborhoods speculators target — typically gentrifying areas with historically Black and Latino populations.

“We want to plan for the successful wealth of our lineage,” said Tuulikki Robertson, director of operations for The Black Institute, which has been engaged with the Council in planning these forthcoming events. “There are predators out there and it’s important to get your will done.”

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New York State is moving to combat deed theft.

Gov. Kathy Hochul on Tuesday signed into law a bill that aims to give prosecutors more latitude to go after fraudulent real estate transactions — and keep homeowners in their homes.

Sponsored by Sen. Brian Kavanagh (D-Manhattan/Brooklyn) and Assemblymember Helene Weinstein and co-authored by Attorney General Letitia James’ office, the law aims to defend New York homeowners who might be victims of deed theft.

“We are empowering homeowners and law enforcement to fight back against deed theft and keeping families, homes, and communities intact,” Hochul said in a statement.

Deed theft happens when the title to a home is stolen without the homeowner’s approval or knowledge. It can involve forgery, fraud or other tricks. Scammers often target older and nonwhite New Yorkers — especially in gentrifying neighborhoods — and may take advantage of precarious situations, such as the threat of foreclosure.

Victims may lose their homes and see a chief source of generational wealth stripped away, which can perpetuate the racial wealth gap.

Over the last decade, at least 3,500 complaints of deed theft have been filed in New York City, according to the New York City Sheriff’s Office. Most of the complaints originate in Brooklyn and Queens.

“The reforms made through this new law will help protect New Yorkers and better enable them to combat those who try and steal their deeds, their wealth and their American Dream,” said James in a statement. 

A spokesperson for the Bronx District Attorney’s office said the protections “will serve our victims well as we prosecute the case.”

But the new law does not close all the loopholes that enable a type of real estate speculation that targets the estates of homeowners who die without wills, as THE CITY has previously reported.

What the Law Does and Doesn’t Do

The law allows the Attorney General and district attorneys to pause housing court eviction proceedings for homeowners who are entangled in ownership or title possession disputes — a provision that could prevent homeowners from being forced out of their homes. Prosecutors can flag properties where they believe deed theft may have occurred in order to prevent further transactions.

The law provides a wider basis allowing both district attorneys and the Attorney General to move to void fraudulent documents that dictate interests in the property. The law also creates a legal presumption of fraudulent deed transfer in civil disputes over ownership if an involved party has a previous deed-related fraud conviction.

Plus, the law extends certain provisions of the state Home Equity Theft Prevention Act. The Act allows homeowners whose properties are in foreclosure or on the city tax lien sale list to cancel contracts to sell their homes. Now, so can homeowners that have active utility liens. Financial distress such as liens or foreclosures can draw the attention of investors and scammers.

K. Scott Kohanowski, general counsel at the Center for New York City Neighborhoods, said the provisions of the law are important to crack down on deed theft.

“Deed theft is so prevalent in  New York City, and it’s constantly changing, constantly morphing,” Kohanowski told THE CITY. “Law enforcement definitely needs more tools to be able to investigate these crimes, and we need more resources in civil legal services to protect homeowners.”

Still, some lawmakers have expressed interest in going beyond the provisions in the new law to address a particular type of real estate investment scheme brought to light by THE CITY in an extensive investigative series.

In these schemes, which some describe as predatory, investors go after homes of deceased owners in neighborhoods where property values have skyrocketed. These properties legally belong to a patchwork of often far-flung heirs, to whom the investors make below-market-value offers in order to acquire shares of the property. Then the investors go to court either to demand a sale of the home, forcing out family members who still live there, or to evict longtime tenants. The goal is to flip the property for many times what the investors paid for the deeds.

That business model is able to flourish because of a lack of government authority in shepherding assets of deceased homeowners and lack of government oversight that allows deed-related paperwork to make it through the system without much vetting, as THE CITY has reported. And nothing compels the disclosure of a property’s estimated market value in deed sales, leaving unwitting heirs to agree to sell their interests for a fraction of the worth. 

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A home in Douglaston, Queens, estimated to be worth more than a million dollars, has become the focal point of a showdown between city officials and a trio of real estate speculators accused of predatory practices and fraud.

Through an LLC called The Queens Foundation, one of those speculators had acquired interests in the property for a few thousand dollars. But this summer, a Queens Surrogate Court judge nullified the deed sales through which the operators claimed partial ownership of the house. The judge sided with the borough’s Public Administrator who argued that the speculators bought the house from two relatives who were only distantly related to the house’s deceased owner and who were not the true inheritors to the property.

A lawyer for the speculators said they would not appeal the decision.

Even so, the counsel to the Queens Public Administrator, which manages the estates of people who die without wills, told THE CITY that his office has decided to keep the case open. As it assesses whether the estate suffered any damages as a result of the actions of the speculators, the public administrator plans to conduct depositions next month to delve into allegedly forged signatures that were used in the sale of the Queens house and of other properties.

In July, shortly before the judge’s decision to vacate the deeds, THE CITY published an investigation revealing how the ring of real estate investors behind The Queens Foundation and many other generically named LLCs operate.

Targeting rapidly gentrifying neighborhoods, the speculators scoop up homes left by owners who died, usually without wills, often paying well below market value to out-of-state heirs, who may not know the value of their relative’s properties. In many cases, the investors — Etai Vardi and brothers Elliot and Joseph Ambalo — go to court to evict tenants living there and flip the properties, often for many times what they paid the heirs. THE CITY found over 100 properties acquired in whole or in part by the trio’s companies and eviction filings by their LLCs naming 160 residents.

In the speculators’ deed sale filings, THE CITY’s investigation also found six signatures that were attributed to five notaries and one heir in states across the country. But all six signatures appeared almost identical. Four of those notaries told THE CITY they did not sign or recognize these signatures.

In a phone call, Gerard Sweeney, counsel to the Queens Public Administrator, said that unless his agency resolves the case, his team intends to depose the businessmen about these six apparent forgeries.

According to court documents, the Queens Public Administrator is scheduled to hold its first deposition on the morning of Nov. 8, and must serve subpoenas for non-party witnesses, such as notaries or title company employees, for examinations that must take place before Nov. 15.

Darlene Wong, a California-based notary who previously told THE CITY that her signature had been forged, said the judge’s July order vacating the deed sales felt like vindication.

“Knowing that the judicial system has stepped in, they did set this aside, it makes me vindicated, it makes me feel good,” she said. “These guys can’t do this stuff. They can’t get away with it.”

Reached by phone, Etai Vardi, one of the speculators, declined to comment, but his associate Elliot Ambalo denied that he, his brother or Vardi fabricated the signatures.

“I guarantee you that none of us did any fraud, caused any fraud to be done, none of that,” he said on a phone call.

For the first time in his communications with THE CITY, Ambalo also named and blamed a former associate, who he claimed had recorded the documents with the apparent forgeries. 

That former associate did not respond to a request for comment about Ambalo’s allegations left in a note with his wife at his home in Brooklyn.

The Queens Public Administrator says it is now preparing the Douglaston house in for sale. Real estate listings show the house is under contract, as of earlier this month.

Another Push To Vacate Deeds

The Queens Public Administrator is pursuing another case in surrogate court against QN 48 LLC, a company run by Elliot Ambalo and Vardi, that could result in more vacated deeds.

In that case, the public administrator alleges that the LLC claimed ownership to a property based on “fraudulent deeds.”

According to deed documents, the speculators bought several shares of a three-story, six-unit building located in Astoria, assessed at over a million dollars by the city.

The businessmen paid less than $300,000 to more than two dozen of the deceased home owner’s family members living in Germany, France, Brazil and upstate New York. 

But, the administrator alleges, those people were not the proper heirs and did not have the right to sell their share of the deeds. 

Edward Vincent, a lawyer representing the investors and the LLC they used to make the purchases, filed papers moving to dismiss. He declined to comment on the pending litigation.

The investors conducted meticulous research to locate the rightful heirs, Elliot Ambalo said, but acknowledged how complicated that can be.

“This is very, very complex stuff,” he said. “It’s not so clear cut.”

Several law enforcement agencies also appear to have taken interest in the fraud allegations stemming from Vardi and the Ambalo brothers’ real estate dealings.

In July, shortly after THE CITY reached out the New York Attorney General’s Office for comment, a prosecutor there contacted an attorney representing the woman in California whom Vardi’s LLC paid claiming she was an heir to the house in Douglaston.

In an interview the same month with THE CITY, Daniel Ifraimov, the CEO of a title company listed as having worked with the businessmen in deed paperwork, said he had been contacted by the FBI “on some of” the transactions that Elliot Ambalo “has done.”

The New York Attorney General’s Office and the FBI’s New York field office did not respond to requests for comment for this story.

In a phone call this month, Elliot Ambalo said he had not heard about the FBI reaching out to Ifraimov.

“I operate to the letter, to the T,” he said. “Everything I do is within the law, 100% legal.”

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The post Queens Public Administrator to Depose Speculator Bros About Forgery Claims Uncovered by THE CITY appeared first on THE CITY - NYC News.

For tens of thousands of Black and Latino families, buying a small family home has been the key to establishing an affordable foothold in New York City. And as gentrification revved up real estate prices in minority neighborhoods, homeownership finally unlocked the opportunity to pass down generational wealth. 

But in an increasingly unequal city, many of these life-changing asset transfers are slipping by as homeowners pass away without wills, leaving valuable property untended and ripe for exploitation.

In a wide-ranging investigation, THE CITY exposed how rings of speculators prey on and profit off of these murky situations. They target neighborhoods where property values have skyrocketed. And they pick out homes that legally belong to a patchwork of heirs — some of them elderly, some of them out-of-state — who have no inkling of the market value of the fractional shares they’ve inherited.

After low-balling heirs for their shares, speculators can go to court to demand a forced sale of the house, threatening the family members who still live there. Or investors can seek to acquire 100% of the house through multiple fractional purchases, allowing them to evict longtime tenants and flip the property for many times what they paid.

Nobody quite knows how many families in New York City are vulnerable to such schemes, since city and state agencies have failed to comprehensively track such tactics. But with hundreds of thousands of one-to-three family houses in gentrifying neighborhoods, the opportunities for the seizure of generational wealth are abundant.

Studies show that only about a third of Americans have a will, with Black and Latino people significantly less likely than White people to lock in formal estate planning. That reality means that scores of family homes in non-white neighborhoods are sitting ducks for speculators looking to cash in.

In response to THE CITY investigation, city and state lawmakers have decried speculators’ tactics, but their rhetoric has not resulted in concrete policy proposals to address the predatory practices.

According to interviews with more than 20 current and former law enforcement investigators, legislators, court officials, housing attorneys and real estate professionals, the failure to resolve the problem lies in a profound lack of state capacity.

When a homeowner dies without a will, each borough’s public administrator relies on neighbors, relatives, funeral directors or institutions that had interacted with the deceased to notify them about the property. With that information, the public administrator can collect personal belongings, sell the home and distribute the proceeds to verified heirs and creditors, if no heir is able or willing to manage the estate. 

But often, these referrals take months or years, or never happen at all, leaving the door open to speculators to find heirs and push them into sales of deeds for far below their market value. Many of their maneuvers may be legal, depending on what they tell heirs, and in interviews with THE CITY, several speculators argued that their business practices were ethical, and even helpful to disadvantaged heirs.

But understaffed agencies hardly ever vet these deed transfers, allowing even those with the indicia of potential fraud to slip through.

K. Scott Kohanowski, director of the Homeowner Stability Initiative at the City Bar Justice Center, says the predation of homes without wills is “the biggest problem that nobody has heard of.”

“It’s something that flies under the radar. It definitely results in a loss of homeownership, especially within communities of color,” he said. “That’s been a huge issue in New York City because there’s been a large flight of Black residents… just because housing is expensive and it’s so difficult to find.”

How Big Is the Problem?

Real estate speculators’ acquisition of fractional property interests has historically been a phenomenon in the rural south, where Black families owned swaths of farmland for generations, and heirs to the land’s deceased title owners became “tenants-in-common” together. 

This shared ownership made such plots vulnerable to real estate speculators, who could acquire fractional shares for little then demand court-ordered sales of Black families’ ancestral land, siphoning off considerable generational wealth in the process. 

The prospects for enrichment are immense. Researchers at Auburn University estimate that $41.9 billion worth of heirs’ property exists across 11 states: Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, Virginia and West Virginia.

And in recent years, researchers and reporters have begun to notice the same schemes in the urban north.

THE CITY, for example, found that two small rings of real estate speculators had acquired or attempted to acquire fractional deeds to more than 150 properties across the five boroughs.

But the scale of the overall phenomenon is little understood. City and state agencies do not have a solid grasp of where properties lack wills and where heirs may be vulnerable to such schemes. Likewise, New York courts have failed to uniformly track speculators’ attempts to trigger residential property sales using fractional home interests, a legal gambit known as “partition.” 

“It’s hard to know how many homes are held in joint ownership. It is certainly something the city should be concerned about,” said Vicki Been, faculty director of NYU’s Furman Center for Real Estate and Urban Policy and a former deputy mayor for housing in the de Blasio administration.  

Who Takes Charge When a Homeowner Dies Without a Will?

When a homeowner passes away without a will and has no relatives with the wherewithal to administer the estate, the borough public administrator might step in to liquidate the property and distribute the proceeds to verified heirs or creditors.

But they might not. In New York, this process, which determines the fate of hundreds of millions of dollars in estate assets each year, usually occurs when someone has made a referral. But the state has no system to automatically notify public administrators of every instance in which someone with property has passed away.

And when no one makes a referral, valuable properties can sit for months or even years without anyone watching over them — a breakdown that allows speculators to find heirs and attempt to claim title with little oversight.

Take the case of 242-26 Rushmore Avenue, a house in Douglaston, Queens. In 2016, the year the property’s homeowner passed away without a will, the city estimated the house to be worth just over a million dollars.

But for the next seven years, no one called the public administrator to step in and manage this valuable asset. Instead, the city continued to send the deceased homeowner tax bills. 

Then in 2020, speculators using an LLC called The Queens Foundation found two supposed heirs to the property and paid them $3,500 and $2,000 each for their alleged fractional inheritances in the home. The speculators had these deed transfers entered into the city’s database, and later that year, the city listed the LLC as the property’s owner on its tax bills, which continued to grow.

Three years later, one of those purported heirs alerted the Queens Public Administrator of concerns she had with the LLC’s deed transfer. As THE CITY previously reported, that alleged heir, a 78-year-old woman in California, claimed she didn’t understand the paperwork she had signed. Likewise, the notary, who put her stamp on the deed transfer, said one of the documents in the deed package submitted to the Department of Finance contained a forged version of her signature.

As a result of the referral, the Queens Public Administrator is now trying to get the speculators’ deeds voided, arguing that she and another heir the LLC paid are not even the property’s true heirs. But the Department of Finance still lists the home’s owner as the Queens Foundation LLC in its latest publicly-available property tax bill.

Javier Ortiz, Brooklyn’s public administrator, said he was open to the idea of an automated system to notify his office when people with property in his borough pass away, but said he could not say if his office would be able to handle the flood of new properties that would come onto his radar.

One former New York City public administrator, who spoke to THE CITY on the condition of anonymity, estimated that public administrators would have to double their staff size to handle the increased caseload.

“It would be overwhelming,” they said, noting that public administrators are already barely able to handle the cases they have. “There’d have to be a major increase in funding.”

Sen. Zellnor Myrie (D-Brooklyn) told THE CITY he is skeptical of relying on the borough’s public administrators’ offices, which have historically been roiled by dysfunction and viewed as patronage mills for political party machines. 

But Myrie says he is interested in introducing legislation to make sure some government authority shepherds these assets for the benefit of their rightful heirs.

“I don’t think this would present any floodgate issues for the courts, and frankly, even if they did, what is more valuable than saving someone’s home, a home that has been in their family for generations?” said Myrie, who represents parts of Crown Heights and Flatbush, two neighborhoods heavily targeted by fractional deed speculators. “I think it’s certainly worth our investment as a government.”

Why Aren’t Heirs Informed of the Value of Their Inheritance? 

When speculators approach distant heirs out of the blue with bargain basement offers, they rely on the fact that the market value of the property is not required to be disclosed at any point in the sale process.

Heirs who agreed to such offers told THE CITY that they were unaware of the value of their holdings, and more or less accepted what speculators told them. According to law enforcement sources, unscrupulous speculators will also sometimes mislead heirs into believing they are on the hook for unpaid property taxes, scaring them into hasty deals.

State Department of Taxation and Finance deed sale documents that are signed by heirs do not provide even an estimated market value for the properties they have partially inherited.

In 2021, for example, an LLC associated with real estate speculator Joseph Ambalo got Carol Pridgen, a 68 year-old Black woman in Virginia, and three of her family members to sell their fractional shares of a house in Jamaica, Queens. The LLC paid Pridgen $30,000 and the other three family members lump sums that added up to $35,000, allowing the speculators to acquire 100% of the property for just $65,000.

The “real property transfer report” that Pridgen signed showed her a figure confusingly labeled as the “total assessed value.” That figure, which is used for property tax calculations, was $22,726. But the same report didn’t notify her of the house’s estimated market value, which was $579,000.

After discussing the offer with the family, Pridgen decided to sign onto the deal. “I thought it was low, but who am I to say? I’m not into real estate,” she told THE CITY.

The year after Ambalo’s LLC paid off Pridgen and her relatives, his company secured a deal to sell the house for $660,000.

Myrie said he would be “really, really interested” in passing a law requiring deed sale packages to include the estimated market value of the properties being sold.

“It’s mind-boggling to me that that doesn’t already exist,” he said. “There doesn’t seem to me be any government interest in keeping that number private, especially from the people who are the rightful heirs of the property.”

Asked about the confusing tax figure included on the form, Geoffrey Gloak, a spokesperson for the state finance department, said his agency will consider updating the “real property transfer report” form it currently uses, but did not provide details on when or how it might do so.

Is Anyone Reviewing the Paperwork? 

After heirs have signed deals to sell their fractional home interests, speculators do not have to provide much more paperwork, such as heirs’ drivers licenses or genealogical reports, to back up their filings. Likewise, regulators at the city Department of Finance have too few resources to carefully vet these transfers.

Jake Baumgarten, an attorney who frequently works on surrogate court and real estate issues, said that the city register, which is part of the Department of Finance, should scrutinize deeds more carefully before recording them.

“If the forms look on their face ok, they accept them,” he said. “They don’t even check who the prior owner was.” 

Michael Corley, a Brooklyn-based real estate broker and president of Corley Realty Group, said the Department of Finance could institute a 90-day review process on deeds in instances when the deed has been held by one individual for 25 years or more until authorities verify that all parties entered into the agreement legally.

Corley also suggested requiring the title agent, notary, seller and buyer to sign a form agreeing to penalties if there’s fraud in the transactions. On that form, any LLCs would have to disclose who is authorized to act on its behalf.

“Introducing it with a sworn affidavit by the DOF suggests that you have to accept responsibility for what you are submitting because right now, in New York City, they can pass anything and not be held legally liable for filing documents that were done illegally,” Corley said.

But that step would run the risk of slowing down the thousands of transactions recorded every day, something that could provoke resistance from the real estate industry. (The Real Estate Board of New York, a powerful trade group representing property owners and developers, did not respond to inquiries about these ideas.)

In an email, a spokesperson for the Department of Finance said staff with the city register review each deed filing submitted to them for recording.

“Under New York State law, the City Register’s Office and the Office of the Richmond County Clerk are generally required to record all deeds and mortgages that are proper on their face,” said the spokesperson. “Recording a deed is a ministerial function and the City Register does not have authority or resources to conduct investigations before recording a deed. Documents that are determined to be possibly fraudulent are referred to the Sheriff’s Office for further review and investigation.”

Given the agency’s limited efforts, it’s not surprising that troubling deed filings slip through, allowing speculators to cash in.

Earlier this month, THE CITY reported on deed packages associated with a group of speculators that contained seven signatures — supposedly from notaries and an heir in different states across the country — that all looked suspiciously similar.

One notary told THE CITY that one of those signatures was a forgery. And four other notaries said they did not write or recognize those signatures.

But the Department of Finance accepted the filings, submitted between 2019 and 2021, and they are still online today. 

One of the suspect signatures was part of a fractional sale to the house in Jamaica, which the speculators eventually flipped for $660,000, about 10 times more than what they paid four heirs. Another was part of a series of transactions that allowed the investors to sell a house in Laurelton for $360,000, after only paying its heirs $85,100.

Rendy Desamours, a spokesperson for City Council Speaker Adrienne Adams, called the targeting of homeowners in these neighborhoods reprehensible.

“The protection of existing homeowners and improving pathways to new homeownership opportunities have long been a priority for Speaker Adams, given the experiences of people across her district and Southeast Queens,” he said in an emailed statement. “The Council has been reviewing ways to facilitate better protection of New Yorkers from these predatory schemes and is open to pursuing all ideas that can help achieve this goal.” 

Why Do Speculators With Partial Shares Have So Much Leverage?

Under New York law, any speculator who has acquired a percentage of a family home can go to court and demand a forced sale to collect their cut of the proceeds.

In 2019, the state legislature amended the law governing this type of legal maneuver, called a partition action, giving fractional homeowners living in a property more opportunities to have court-mandated mediation sessions.

But the law does not fundamentally eliminate the leverage that speculators have. In mediation sessions, investors push homeowners to pay them far more than they paid the other purported fractional heirs just for the assurance that they can continue living in the house they’ve called home. If long term residents refuse, the speculators can always force a sale. 

Been, of NYU’s Furman Center, suggested one mechanism that could allow people to preserve their family homes and home equity: give joint owners the option of buying out their co-owners’ shares, either for a price set by a court or for the same price that an outside investor has offered. Such a right could deter speculators, or at least make it harder for them to perpetuate their schemes, she said.

“Just slowing the process down so people have to talk to their co-tenants would help on a lot of these — but not all, as families are tricky and there’s lots of dysfunction and estrangement,” Been said.

Such protections might have helped Deborah Thomas and Aston Smith, two longtime Black residents of Bedford-Stuyvesant, save hundreds of thousands of dollars.

In 2020, a trio of speculators filed a partition action in court against the couple, threatening the possibility of a court-ordered sale of their brownstone. The couple had lived there for years and previously co-owned it with Smith’s deceased mother. But after her passing in 2015, her will gave 16.66% of the house to Smith’s older brother, who had become estranged from Aston in the wake of her death. The speculators drove to the sibling’s house in North Carolina, and eventually got him to agree to sell his minority interest for just $65,000.

That share gave the speculators power over the retired couple in court. “We were gonna squeeze them and sell [the property] at auction, and then we decided to settle,” recalled Eddie Doran, one of the speculators.

The next year, Thomas and Smith inked an agreement, paying Doran and two fellow speculators $235,000 to keep their family home.

The settlement was more than three times what the investors had paid Smith’s estranged brother.  

“This is what they do for a living,” said Thomas. “My husband worked hard all his life and paid for his properties, and someone come in, go down to a court, see who owns what, and just try to go through heirs of people who own property. They don’t buy anything, they steal it.”

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The post Little Oversight, Deals Signed in the Dark: How Speculators Cash In When NYC Homeowners Die Without Wills appeared first on THE CITY - NYC News.

Three real estate speculators, brothers Joseph and Elliot Ambalo and Etai Vardi, were the subject of a recent investigation by THE CITY, which examined claims that they had ripped off fractional property heirs and unearthed multiple fraud and forgery allegations in transactions involving the speculators’ limited liability companies. 

Some in law enforcement and the housing advocacy world had heard of this speculator ring before, but the extent of their activities was difficult to grasp because the investors purchased their properties under the cover of generically named LLCs, such as Blackstone Real Estate Group and North Bronx Ventures.

THE CITY found these obscure companies by compiling and reading through thousands of court and deed transfer records.

Heirs who are approached to sell fractional shares are especially vulnerable. Often, their relatives died without a will. They may know nothing about their inheritances and lack attorneys to help them. In many cases, they live outside New York City, and have no inkling of the potential value of their shares. 

At least one 78-year-old woman approached by the speculators about a house in Queens told THE CITY that she thought the businessmen were helping her process a calculated inheritance she had been allotted. In reality, they got her to sign onto a deed transfer, which the Queens County Public administrator is now seeking to vacate.

Tenants often have little idea of who is behind the changes in ownership of the properties, many of which they have been living in for years. Clyde and Natalie Huddlin, two residents that THE CITY spoke to, didn’t make much of the residential removal petition that they received in February. Someone left a pile of papers on the front step of their home in St. Albans, Queens. It didn’t seem official, so they didn’t get a lawyer.

“I didn’t take it serious,” recalled Natalie Huddlin, 46, a childcare provider.

But the removal demand was real.

It was officially being carried out in the name of one of the deceased homeowner’s relatives but the speculators are likely involved. The relative, who lives in Maryland, used a business address associated with the Ambalos and Vardi in her removal petition. A few weeks before the Huddlins got the papers, one of the speculators’ LLCs, New York Asset Recovery Group, entered into a memorandum of contract with the relative to sell them the house.

Natalie told THE CITY she is worried the judge will order her to move at their next scheduled court date in August.

To provide public information about these speculators’ home purchase and eviction efforts to heirs, tenants and other affected residents, THE CITY is disclosing numerous LLC names that the investors have used since 2018. This list is not definitive, and the investors may deploy other company names in the future.

Residents who would like to learn more about the LLCs on this list can search the city’s deed database, ACRIS, by these business names to learn more about their transaction histories. They can also search New York’s online court search tool to learn about the LLCs’ residential removal and eviction efforts.

Limited Liability Companies Associated with Joseph and Elliot Ambalo and Etai Vardi

135 STREET INVESTORS LLC

153 FOCH LLC

1847 NEREID LLC

19138 115 ROAD ASSOCIATES LLC

229 CLIFTON PLACE LLC

76 ROCKAWAY BLVD LLC

ACTION NO 37 LLC

ACTION NO 53 LLC

BERGEN STREET MANAGING PARTNERS LLC

BK 146 LLC

BK 950 LLC

BK AUTUMN 701 LLC

BK BEVERLEY LLC

BK DEVOE LLC

BK DEVOE STREET LLC

BK MACON LLC

BK ROSEDALE LLC

BK SARATOGA LLC

BK SHEFFIELD LLC

BLACKROCK EQUITY GROUP LLC

BLACKROCK REAL ESTATE GROUP LLC

BLACKSTONE REAL ESTATE GROUP LLC

BROOKLYN GATES LLC

BX 1076 LLC

BX 1331 LLC

BX MULINER LLC

BX ROSEDALE LLC

EAST NEW YORK RLTY LLC

GILLESPIE AVENUE DEVELOPMENT LLC

GREEN BAMBA LLC

JACKIE 42 LLC

KINGS COUNTY FOUNDATION LLC

MACDONOUGH STREET DEVELOPMENT LLC

MANHATTAN FOUNDATION LLC

MN W 152 LLC

NEW YORK ASSET RECOVERY FOUNDATION LLC

NEW YORK ASSET RECOVERY GROUP LLC

NORTH BRONX VENTURES LLC

NORTH BUSHWICK VENTURES LLC

NORTH QUEENS VENTURES LLC

ONE EIGHTEEN 204 HOLDINGS LLC

ONE THREE SEVEN 24 HOLDINGS LLC

ONE TWENTY TWO HOLDINGS LLC

ONE ZERO FIVE 39 HOLDINGS LLC

QN 147 VENTURES LLC

QN 204 LLC

QN 48 LLC

QN NAMEOKE LLC

QN ST ALBANS HOLDINGS LLC

SOUTH BRONX VENTURES LLC

SOUTH JAMAICA HOLDINGS LLC

SOUTH JAMAICA HOLDINGS 2 LLC

STATEN ISLAND VENTURES LLC

THE BROOKLYN FOUNDATION LLC

THE EASTERN AND ATLANTIC FOUNDATION LLC

THE QUEENS FOUNDATION LLC

THE QUEENS FOUNDATION MMXX LLC

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The post 3 Speculators, 119 Homes, 57 LLCs appeared first on THE CITY - NYC News.

Additional reporting by Sam Rabiyah and Suhail Bhat

Three years ago on a wintry afternoon, JJ was sitting in bed in her Bushwick apartment when she heard a boom at the door. It sounded like an intruder was trying to kick his way in.

JJ, who is Black, peered through the peephole and saw three white men in suit jackets. She was afraid. They looked like detectives. 

“I opened my door, and I’m like, ‘How can I help you?’” recalled the 42 year-old mother of two, who agreed to speak on the condition of anonymity, citing safety concerns.

That’s when, she said, one of the men introduced himself as “the new owner of the building.” 

“I’m like, what? Excuse me?” recalled JJ, who had moved in about seven years earlier and previously paid rent to the relative of a friend living upstairs.

The man told JJ she had a few months to move out. As she stood by bewildered, his two associates were already at work putting new locks on her door.

What JJ didn’t know was that months earlier a group of strangers had indeed acquired title to the house, just a short walk away from the bars and clubs popular with Bushwick’s newcomers. They’d found five far-flung heirs of the property’s deceased owner and convinced them to sell their fractional inheritances for a grand total of $35,500, according to city deed records. 

JJ’s home was not their only target. A new investigation by THE CITY has found 119 properties across the five boroughs acquired in part or in whole by companies operated by two brothers, Elliot and Joseph Ambalo, and their business partner Etai Vardi. This crew of speculators nab properties in gentrifying Black and Latino neighborhoods, where many homes are ripe for the taking because their original owners died without wills, leaving a network of dispersed inheritors who may not know the value of their partial shares. 

As THE CITY previously reported, similar rings amass partial shares to shake down longtime homeowners for money or to profit from forced home sales. But the Ambalo brothers and Vardi often capitalize on another method: using generically named LLCs like The Queens Foundation and Jackie 42, they find small, multi-family homes with minimal tenant protections, take over the properties by paying heirs low sums, then rush to evict the residents, clearing the path to flip the properties for many times what they paid.

This ring’s maneuvers, which have displaced dozens of longtime city residents, are largely legal. But in some of their transactions, THE CITY found evidence of possible fraud. One notary public based in California believes that her signature was forged on a deed-related affidavit that Vardi also signed. Four other notary publics across the country said they did not sign or recognize their purported signatures that appear in paperwork signed by Vardi or one of the two Ambalo brothers.

The Ambalo brothers and Vardi rebuffed THE CITY’s attempts to interview them at length in person and on the phone. In response to a detailed set of questions sent to them ahead of publication, Vardi shared a brief statement in an email on behalf of the ring.

“The purchase of fractional shares of properties is a long-standing, lawful business practice in the real estate industry,” Vardi wrote. “We have always and will continue to operate within the law and in an ethical manner.”

Of the 119 properties THE CITY identified, 34 have been the subject of eviction or removal petitions filed by the investors’ LLCs, which named 160 residents they wanted out of their newly acquired properties, according to court records. In 19 of these cases, the speculators failed to register their ownership with city authorities, a violation of New York City’s Housing Maintenance Code, before moving to evict tenants. 

In 29 of the 119 properties, city deed records show the investors completed a flip of partial home shares or entire properties. In all, they paid heirs and other property-holders nearly $4.8 million then subsequently sold the shares to new buyers for $14.3 million — a $9.5 million difference.

In many cases, the flips and displacement went hand-in-hand.

One of the LLCs paid three heirs $190,000 for a two-family house in Cypress Hills, Brooklyn, according to deed records. Just six months later — after filing to remove three residents — the LLC sold it for $630,700. 

At a single-family home in Cambria Heights, Queens, another one of investors’ companies agreed to pay $45,000 to six heirs living across the east coast, deed filings show. A few weeks before the LLC inked its final deed purchase, it went to court to kick out five tenants. About eight months later, the LLC sold the “completely newly renovated” house for $775,000.

Heather Domi, a veteran real estate broker with Compass and the founding chairperson of the New York Residential Agent Continuum, a brokers’ trade organization, said such practices prey on unsuspecting heirs.

“We are currently seeing a huge transfer of generational wealth. Sadly many individuals are not prepared and the beneficiaries are not educated on the topic,” Domi said. “There should be education and awareness around these assets to protect these vulnerable individuals.”

At the Bushwick house where JJ once lived, the investors may be on the verge of yet another payday, having successfully evicted JJ and her children this year. Today, the home is in contract, according to a broker, and Zillow estimates its value at nearly $1.2 million.

“They shouldn’t be able to do this to families,” said JJ, who now lives in another part of Brooklyn. “Because you’re putting people out on the street.”

‘Dedication to Transparency and Honesty’

It’s only been about a decade since Elliot Ambalo graduated from high school, dropped out of Touro College, and began trying to flip houses with his younger brother Joseph and Vardi.

Each member of the ring contributes their unique talents to the enterprise. 

Elliot identifies properties “in heavy disrepair or vacant,” as he said in a 2022 deposition, and contacts the purported owners. Etai and Joseph conduct genealogical research to determine family ties. Then the partners make an offer, taking into account the size of a family, the level of access they have to the property and possible legal fees they might incur down the line. 

“We can buy the property and make some money and move on quickly. Buy it, fix it up, make a couple of bucks and then move on,” Joseph said in a separate 2022 deposition related to the same case.

Deed purchases with the business address associated with the Ambalos’ “Premier Property GRP” only go back to around 2018. But by 2020, on their website, the Ambalo brothers portrayed themselves as seasoned brokers in the Big Apple. 

“Both licensed real estate brokers with years of experience in the industry, their entrepreneurial spirits and encouragement from their trusted clients drove them to develop Premier Property GRP,” the website read.

This was not true, as the brothers would admit two years later during the depositions. Neither ever held a broker’s license, at least in New York. And today, their website specifies the brothers are “not real-estate brokers” but “strategic investors.” 

But the following claim has remained: “What makes Premier stand out from the competition is our dedication to transparency and honesty.”

The Seizure of a Black Family Home

In many cases, the small, multi-family properties that the Ambalo brothers and Vardi acquired house longtime New Yorkers at below-market rents, even though the units are not rent-stabilized. The residents may have an unregulated lease or merely a handshake agreement with the property’s homeowners, allowing them to live for free or to pay what they can afford. Either way, they have few protections when a new landlord wants them out.

Take the case of Desmond Barnes, who began living in his family’s brick home on a tree-lined street in Jamaica, Queens, 10 years ago.

The house belonged to Viola, his grandmother’s cousin, who had jointly owned it with her late husband. In 2013, with her husband’s passing and her health waning, Viola moved down to Virginia so that Desmond’s mom could take care of her. That year, Desmond, now a 33-year-old boiler mechanic, settled into the house to keep an eye on it.

The home had been in his family for decades. So when Desmond saw problems, he fixed them. He installed a water heater, repaired cracked pipes and covered up sheetrock in the home with tiles. 

“I did the front brick steps of that house. I’m not even a mason,” he said. “I put blood and sweat to make sure that house was good.”

In 2018, Viola passed away without a will. After her death, Desmond remained devoted to the house, which had become a refuge for him, even though he had not inherited it.

Before moving in, he had been crashing on couches and struggling to find his footing in the city. With the house there for him, he didn’t need to worry about finding or paying for a place to stay in tough times — especially the exhausting period when he worked shifts at a Manhattan hardware store and took plumbing classes at Bronx Community College before heading back to Queens.

“Just having some place to lay my head helped me focus on putting myself in a position to progress,” he said.

The tradesman even entertained notions of saving up to buy the place. 

But unbeknownst to Desmond, the speculators were making moves that would soon take the home out of his family’s hands.

In early 2021, Joseph Ambalo, using an LLC called South Jamaica Holdings 2, paid Viola’s four supposed heirs $65,000 total for their shares of the house, deed records show. These were relatives — living in Maryland, Virginia and upstate New York — whom Desmond barely knew. 

“When we got the call, we were really surprised,” said one of them, Joyce Fisher, 51, Viola’s great niece.

Carol Pridgen, Fisher’s aunt, had reservations about the offer, but said after discussions the family decided to accept. The 68-year-old said her niece could’ve used the money, and her nephew, who had been in and out of jail, was happy when he heard he was in for a payday.

“I thought it was low, but who am I to say? I’m not into real estate,” said Pridgen.

Back in New York, soon after the heirs moved forward with the offer, Desmond’s phone rang while he was on a job site in Williamsburg. He walked into an alleyway to take the call. It was a man saying he was the new landlord and that Desmond had to go. 

“I was agitated,” Desmond said. “Who are you, to just be calling out of the blue?”

In the absence of any paperwork proving the caller’s claim, he pushed the threat to the back of his mind. But that summer, letters with the same message followed. That November, the South Jamaica Holdings 2 LLC — with Elliot Ambalo named as managing agent — filed court papers to remove Desmond. He moved out that month.

In May 2022, less than a year after Joseph Ambalo had bought out the heirs, he secured a deal to sell the house for $660,000, more than 10 times what his LLC had paid them, according to city deed records.

Fisher and Pridgen were incredulous when THE CITY informed them about the flip.

“He stole our money. He stole it from us. That was a ripoff. That’s a scam,” Pridgen said.

“Wow,” Fisher said. “They made out.”

Fraud and Forgery Allegations

At least two purported heirs and one notary public have leveled fraud or forgery allegations against the speculators or their associates, either in court or in interviews with THE CITY.

One of those purported heirs, 78-year-old Californian Oda Killian, received a call out of the blue about three years ago from a man whose name sounded like “Etsy.” 

Killian said the man told her that she was one of eight heirs to a house in Douglaston, Queens, which had belonged to a cousin once removed who died in 2016 without a will. Killian hadn’t seen her relative since she was a kid and didn’t even know she had passed away.

But Killian said she trusted the stranger, whose matter-of-fact manner made it seem like he was helping her process a predetermined inheritance distribution.

The septuagenarian says she didn’t realize that he was pushing her into a deed sale, the terms of which she could have had some say in. It just seemed like, “This is what’s happening,” she recalled.

That October, the speculators arranged for Darlene Wong, a notary public from a nearby county, to show up at Killian’s house to notarize a batch of paperwork required to seal the deal, which she did.

But Wong told THE CITY that she did not sign one of the deed package documents that was filed with New York City’s Department of Finance over a week later, and which was also signed by Vardi. 

Wong writes out her last name in cursive, but the signature on the document Wong purportedly signed and notarized is a looping scribble that looks like a single “M.”

“Absolutely not,” said Wong, when asked if she could have signed the document that way. “That’s not my signature at all.”

Poring over deed transaction records involving LLCs associated with the speculators, THE CITY identified six other signatures from five other notaries and one purported heir that look similar to the M-shaped one Wong says is forged. When presented with the documents, four of those notaries confirmed to THE CITY that they either did not write or recognize the signature as theirs. 

One of those suspect signatures was part of a chain of transactions that deed records show led to the sale of a Laurelton, Queens, house for $360,000, just a few months after the investors’ LLC paid the last of five heirs $85,100. 

“I do not recall making that mark,” said that notary, who is based in Rhode Island and spoke to THE CITY on the condition of anonymity. That document was also signed by Elliot Ambalo.

Vardi did not respond to detailed questions from THE CITY about Wong’s allegations. But in a brief phone call, Elliot Ambalo referred questions about the signature that Wong said was forged to the title company on the transactions.

“I don’t record the documents,” Ambalo said.

In a text message, however, Daniel Ifraimov, the CEO of the title company, EastCor Land Services, claimed that the “title co never signs anything,” and affirmed in a phone call that the speculators would have also had access to this kind of deed paperwork, which they signed.

The office of New York Attorney General Letitia James did not comment on the suspect signatures, but shortly after receiving a request for comment about some of them, an assistant attorney general from the office contacted George Grasso, Killian’s lawyer.

“I’d be happy to work with law enforcement on any level, whether it’s local, state or federal,” Grasso said in a phone call. 

And at least one other authority is scrutinizing the speculators. Earlier this year in an effort to preempt a flip of Killian’s relative’s property, Grasso contacted the Queens County Public Administrator to flag his client’s concerns. In April, the public administrator filed a petition asking a judge to vacate Killian’s deed transfer and accused the investors’ LLC of fraud. That request is still pending.

‘They Don’t Target Them. They Target Us.’

Two years ago, after a stranger called Desmond Barnes and told him he had to leave the family home, the boiler mechanic packed up his tools and put them in a storage unit. One day he feared he’d drive home and find new locks on the doors.

That November, Desmond moved to a nearby apartment, but he continued to care for the house. When the snow fell, the tradesman would stop by to shovel the sidewalk, standing in the cold by the front steps he’d bricked years earlier. 

But in the eyes of the law, Desmond had no right to the property. Its official heirs had sold the family home for a fraction of its worth. 

After Desmond moved out, a housing court judge ordered him to turn over his keys. 

So one day in January after work, the boiler mechanic waited outside the house and watched as a young white man pulled up in a BMW.

Desmond and the man walked in together. At first, the stranger was chatty, asking which belongings he might want to take with him. A decades-old Dewalt table saw, which Desmond valued as a craftsman, was in the basement in pristine condition. Viola’s closets were still full of vintage skirts and tops. 

“He’s like, ‘Oh do you want to take that? You know, that might be worth money,’” he recalled the man saying.

The questions infuriated Desmond, whose demeanor soon deterred the stranger from more small talk.

“You do realize I had to break my neck to find the apartment and move everything out? You think I got time to f*** around?” he recalled thinking. “They’re just aloof people to the real world.”

Desmond handed the man his keys, and turned his back on Viola’s house.

The following year, with his father struggling with his health and the family home gone, Desmond decided to move down to Virginia. 

“I love New York to death,” he said. “New York is home, and it always will be. But as a person trying to do certain things, that just ain’t the place.”

Desmond grew up in New York. He could handle the hustle.

“But what these guys are doing, this ain’t regular panhandling on the street, regular New York, you know, you gotta find your wallet,” he said. “Nah, this is a tactical, coordinated thing that they are doing.”

“And why would they specifically target minority communities? They don’t do that in Bensonhurst. They don’t do that in parts of Bay Ridge.” Desmond continued. “You think them people don’t got any family issues or credit issues? Yeah, they go through all that too. But they don’t target them. They target us.”

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