“Rental security deposits held by [CitiApartments and associated companies] were funneled into an array of bank accounts and plundered, potentially affecting thousands of tenants, according to lawsuits.”
Lawsuit alleges CitiApartments drained tenant deposit accounts [Examiner]

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Comments from “Plugged-In” Readers

  1. Posted by Chad

    From the article
    “What we suspect is that the money has made it into somebody’s pocket,” said attorney Brian Devine
    Yawn. What’s new here ? Infectious Greed at it’s Grandest.

  2. Posted by San FronziScheme

    This would deserve its own HBO show! New material created every day by some of SF’s finests!

  3. Posted by Mystery Realtor

    I don’t why this surprises anyone.

  4. Posted by lolcat_94123

    What’s w/ the picture included in that article? A little over dramatic are we?
    http://media.sfexaminer.com/images/250*157/sfcitiapartments13.jpg

  5. Posted by Eric in SF

    I think that photo looks that way because it wasn’t converted to RGB from CMYK.
    Printing presses use CMYK color space, the web/internet uses RGB color space.

  6. Posted by Delancey

    At least there’s something to collect from after they win the lawsuit(s). I assume they’ll be in a relatively high position on the creditors list during the bankruptcy.
    Still, I’d like to see one or more responsible people personally suffer for this–commingling (and then losing) damage deposits with operating cash doesn’t “just happen”.

  7. Posted by Jimmy (No Longer Bitter)

    Ripping off peoples’ damage deposits? Anywhere but San Francisco, that would be considered theft and prosecuted accordingly. Here, “it’s just a civil matter.”

  8. Posted by Fred

    You need to get around Jimmy. In much of the country, standard operating procedure is to confiscate the bulk of the damage deposit when the tenant leaves, on the grounds of trivialities. One consequence is for tenants to be very reluctant to hand over large damage deposits. But landlords need to make a profit. So they respond by hiking the rents for new tenants, while keeping rents low on reliable long-term tenants. Note the similarities with rent control. Both tend to favor long-term tenants over those who move frequently.

  9. Posted by Jimmy (No Longer Bitter)

    Yeah. Then there’s tenants like me, who were in the habit of suing bad landlords and recovering said damage deposits in small claims court. I enjoy small claims (and I’ve always won, 3/3 so far). Of course now I own so there’s no one to sue… but it was fun while it lasted.

  10. Posted by DavidQ

    @Fred
    I’m not sure your claim holds up universally; my anecdotal experience as a renter of numerous apartments in Minneapolis, Manhattan, and SF for the last 11 years (landlords ranging from elderly women who live in the upper/lower flat, to small companies, to a giant firm in NYC) suggests that while individual landlords will nickle and dime you, the default is that if you haven’t destroyed the place you get most of your deposit back.
    Perhaps I’m just lucky every time, or maybe I haven’t rented from slumlord scumbags.

  11. Posted by Fred

    You wasted your time, Jimmy. The right type of letter would normally have done the trick. (Worked for me the 2/2 times I tried.) The key is to convince the landlord that: (a) you are still in the area; (b) you can afford to waste your time and his in court; (c) you are sophisticated enough and have enough evidence to present a good case. Do this, and the landlord typically folds. Then again, if he thinks you are bluffing, he might call the bluff. If you no longer live in the area and the landlord calls the bluff, then you’re screwed. Again, as with rent control and prop 13, we see the system penalizing the highly mobile young in favor of the less mobile elderly.

  12. Posted by Jimmy (No Longer Bitter)

    Well, I may have been wasting my time, but I did enjoy winning (especially against that b*tch in East Cambridge, MA — $1187 judgement in my favor!). The last one folded and it never went to court, and all I had to do was file on-line (took me under an hour and I never left my couch). I just love small claims, it cuts through all the BS and ‘negotiations’ with stupid people and gets right down to brass tacks.

  13. Posted by EH

    Do this, and the landlord typically folds.
    Yeah, but you don’t get treble damages that way. I once had a landlord offer me double my claim outside of court after having flaked twice before. It didn’t take me but two beats to decide I’d rather his name have a judgment on the books. I was 26 at the time, hardly elderly and hardly The System. Just a dick landlord bullying the wrong person.

  14. Posted by StockBoySF

    I noticed a lot of “For Rent” signs on the CitiApartments’ buildings over the last couple of years. That would mean high turnover caused by either a.) unhappy tenants or b.) CitiA was forcing tenants out. In either case it’s a red flag.
    All their buildings seemed well kept up on the outside… anyone know if they maintained the units and common areas? There might be some good bargains to be had.

  15. Posted by Z

    “…All their buildings seemed well kept up on the outside…”
    Really? Take a look at 50 Laguna or sister bldg. 16 Laguna near Waller. And since the door will probably be blowing open at 50 (16’s door is covered with plywood) go on in and check out the carpets and walls. Most Tenderloin bldgs. are not this filthy. They spent about 15-25 K renovating apts., (.5 mil lien against them for not paying contractor) bought several people out, but never even shampooed the extremely filthy carpets nor painted the hallways.
    Remember, this Lembi empire is the same family that ran (into the ground) Continental Savings in the late 1980’s. Is there a pattern of fraud?

  16. Posted by gh

    I live in the Marina and two Lembi buildings there on Scott and Pierce St. are in crappy shape. Seems he buys them from a conscientous owner, stops doing maintenance, and then gets foreclosed upon.

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