THIS WEEK IN THE NEWS
July 21 to July 25, 2014
Attorney General Schneiderman and the New York State Superintendent of Financial Services reached an agreement with ride-sharing service Lyft to ensure the company operates in New York State in full compliance with existing regulations. The company will launch in New York City with commercial drivers only and will operate in a manner that is consistent with existing statutes. In addition, the company will suspend its current operations in Buffalo and Rochester by August 1, 2014, and has committed that it will work with the State so that any future business it undertakes in New York is in full compliance with the law.
Attorney General Schneiderman announced that thousands of victims who were defrauded by two immigration services organizations, the International Immigrants Foundation, Inc. (IIF) and the International Professional Association, Inc. (IPA), could begin applying for compensation from his office’s $2.2 million fund, which was created as part of his settlement with those organizations. Victims of IIF’s and IPA’s misconduct will be able to submit claims for restitution for fees paid for immigration services that were never lawfully rendered, often resulting in both financial and legal consequences. In one instance, an individual was eligible to obtain a Green Card, but lost his opportunity due to the organizations’ delay and negligence, despite paying more than $18,000 in fees and costs to them.
Attorney General Schneiderman and Comptroller DiNapoli announced that William Rapfogel, former executive director and chief executive officer of the Metropolitan Council on Jewish Poverty (Met Council), has been sentenced to up to 10 years in prison. The Attorney General’s investigation revealed that Rapfogel and his co-conspirators stole approximately $9 million from the taxpayer-funded nonprofit organization in a 20-year grand larceny and kickback scheme. As part of his sentencing, Rapfogel has also been ordered to pay $3 million in restitution to the Met Council – the total amount of money that he personally stole from the charity to fund his lavish lifestyle. Including this case, Attorney General Schneiderman has prosecuted more than 40 nonprofit officials, politicians and government employees who abused the public trust since taking office.
Attorney General Schneiderman obtained a court order halting sales of timeshares at the Manhattan Club while his office continues its investigation into the company’s alleged bait-and-switch scheme. The Attorney General’s Office has received complaints from consumers who paid tens of thousands of dollars to become Manhattan Club “owners” but have been unable to make reservations due to a claimed lack of available rooms by the hotel’s operators. At the same time, rooms in the Manhattan Club are being rented over the internet to the general public. The court order also freezes the company’s bank accounts and bars its owners from foreclosing on defrauded purchasers.
Attorney General Schneiderman secured the felony tax fraud conviction of a Brooklyn man and a more than $520,000 civil judgment lodged against him and his wife for activities related to the Brooklyn-based charitable fundraising ring he operated, which solicited donations from thousands of donors for phony not-for-profit organizations in the name of Israeli causes. They are alleged to have been the biggest beneficiaries of the scheme and are, under the judgment, required to pay $522,315. Approximately $360,000 of those funds will go to two Israeli charitable organizations that carry out genuine programs similar to the causes for which the defendant’s fraudulent solicitations raised donations from the public.
Schneiderman Serves Notice Of Intent To Sue Long Island Companies In Joint Federal-State Mortgage Rescue Fraud Sweep
As part of a joint federal-state sweep with the Consumer Financial Protection Bureau, the Federal Trade Commission and 14 other states, the Attorney General served a notice of intent to bring litigation against Long Island-based Home Affordable Direct, Inc. and JR Holding Group Corp for operating a fraudulent mortgage rescue and loan modification scheme that scammed consumers into paying large upfront fees but failed to fulfill promises to help homeowners stay in their homes and avoid foreclosure. Mortgage rescue scams target vulnerable homeowners and, for an upfront fee, promise to save their homes by negotiating lower mortgage payments or principal reductions with the homeowners’ mortgage servicers or lenders. After collecting upfront fees, these scam operations fail to provide the services promised, placing their victims at even greater risk of foreclosure.
With the Federal Trade Commission, Attorney General Schneiderman issued a preliminary injunction halting a Buffalo-based debt collection operation charged with violating New York State and federal law. Targeting consumers in financial distress, the debt collectors are alleged to have harassed its New York customers, falsely accusing them of committing check fraud as well as threatening them with arrest, imprisonment, wage garnishments, and civil suits. The court order stops the illegal conduct, freezes the operation’s assets, and appoints a temporary receiver to take over the defendants’ businesses. This action was part of Attorney General Schneiderman’s continuing crackdown on rogue debt collectors that target consumers in financial distress.
Attorney General Schneiderman announced that he is leading a coalition of more than 25 states urging the U.S. Supreme Court to uphold consumer rescission rights under the federal Truth in Lending Act (TILA). TILA requires creditors to clearly and accurately disclose the terms of loans to consumers and to inform consumers about their statutory rights. When creditors fail to take these steps, consumers have three years from the date of a covered home loan, to rescind the loan. Rescission is a powerful consumer remedy and protects consumers from losing their homes in foreclosure proceedings.
Schneiderman & NYS Tax Commissioner Mattox Announce Guilty Plea Of Tax-Evading Former Head Shop Owner
Attorney General Schneiderman and Commissioner Mattox announced that the former owner and operator of Tebb’s Head Shops, located throughout Central New York, pleaded guilty to felony charges related to a five-year scheme to avoid paying in excess of $616,000 in New York sales and income tax. He has previously admitted to selling dangerous synthetic drugs, known as bath salts, at his stores. The defendant will be sentenced to up to six years in prison and will be required to pay his unpaid taxes.
Schneiderman Arrests Rochester-Based Medication Technician For Allegedly Stealing Prescription Narcotics From Nursing Home Residents
Attorney General Schneiderman’s Office arrested a medication technician, formerly employed at a Rochester-based nursing home, who allegedly substituted her elderly patients’ prescription medications for similar-looking pills, stealing the narcotics for her personal use. The defendant faces 17 charges for allegedly taking a total of 650 narcotic pills from eight patients. If found guilty, she could serve up to four years in prison.
Schneiderman Announces Prison Sentence For Capital Region Roofer Who Repeatedly Defrauded Homeowners
Attorney General Schneiderman announced the sentencing of a Capital Region-based home contractor who stole thousands of dollars from homeowners by repeatedly taking their money but failing to complete work on their homes. The defendant will serve up to nine years in prison for his fraud.
In Other News…
The Attorney General also hosted a successful and informative round table discussion with Asian media outlets in New York City.
For more information on Attorney General Schneiderman or other politicians hit us up at RandyKFisher@gmail.com.
Posted by Charles and Randy Fisher (Twitter @HHSYC).