Bill Proposed To Restrict Banks From Lending To Landlords That Break The Law
A New York State senator is proposing a new law that would bar landlords with fraud convictions or housing law violations from securing financing from state-chartered banks.
The legislation would prevent local banks like New York Community Bank and Signature Bank from lending to landlords like Steve Croman, who inspired the legislation, The Real Deal reports. State Sen. Brad Hoylman, whose district runs from Greenwich Village to Hell's Kitchen, announced his plans for the laws at a protest outside Croman’s Upper East Side home last week.
“[They] will not be handed more money to grow their evil empires and take advantage of even more New Yorkers,” Hoylman said, according to TRD.
He said he hopes the law would set a new standard for other lenders to follow. Wells Fargo, JPMorgan Chase and Deutsche Bank would not have to comply with the ban, as they are federally funded and chartered in other states.
Croman, one of the city’s most notorious landlords, was sentenced to a year in jail in 2017 after being convicted of multiple counts of mortgage fraud and tax evasion. Prosecutors said that over a period of years, Croman ran harassment campaigns at more than 100 buildings he owned in Manhattan.
In 2018, New York state announced it had made an $8M fund available to compensate Croman’s victims. Croman paid into the fund as part of a consent decree.
The following year, tenants who say Croman forced them out of their rent-stabilized apartments in East Harlem were given class-action status to sue him. Croman is not allowed to manage his own property for five years, but TRD reported in 2019 he has acquired new properties in the city and made visits to buildings he owns.
