NEW YORK – New York State Housing and Community Renewal (HCR) Commissioner Ruth Ann Bisnaukas and New York Attorney General Laetitia James announced today that Affordability and Homeownership in a low-income cooperative (co-op) development in Rockland County. announced that it has maintained In the course of his two-year investigation, the Office of the Attorney General (OAG) found that a building at 18-36 Columbus Avenue in Spring Valley was at risk of foreclosure due to unlawful misappropriation by its partners. discovered. Russell Mainardi, a real estate scammer, and his girlfriend, who was the co-op’s estate manager. Mainardi and his girlfriend grossly mismanaged the building’s finances for personal gain, putting residents at risk of losing their homes. Rockland Housing Action Coalition (RHAC), Community Preservation Corporation (CPC) ), and with the help of law firm Nixon Peabody, OAG and HCR were able to protect their assets and stabilize them financially and physically.
The agreement would require Minardi and his collaborators to pay the cooperative a $148,681 return and a $250,000 penalty, his girlfriend would resign as property manager, and Minardi would take over the existing New York property. are permanently prohibited from developing real estate or fundraising activities in residential areas of The contract also required the cancellation of a $696,647.00 lien improperly placed by Mainardi on the property.
“Through no fault of their own, the homeowners of 18-36 Columbus Street were in grave danger of foreclosure, long-term financial distress and the loss of their hard-earned homes,” it said. . Home and Community Renewal in New York State Commissioner Ruthuan Visnaukas. “The state intervention has ensured that the cooperative remains affordable, well managed and in good standing. 18-36 Columbus Avenue is located in an increasingly expensive area and Offering homeownership opportunities otherwise out of reach for income and middle-income individuals, the Office of the Attorney General, Rockland Housing Assistance Corporation, Community Preservation Corporation, and Nixon Peabody Thank you for your vital support in preserving this affordable housing resource that benefits New Yorkers throughout the years.”
“No one should risk losing their home because of someone else’s illegal or fraudulent activity. Attorney General James“Minardi and his associates have defrauded the way this affordable building is managed and have put residents on the verge of losing their homes due to fraud and deception. Safe, decent and affordable.” Access to housing should be a basic right for every New Yorker, and thanks to our partners at HCR, all of these individuals are able to stay home.”
“New York continues to face a devastating housing crisis, especially the loss of existing affordable units due to poor management is not an option for our community.” New York City Comptroller Brad Lander said:“New York City Retirement Systems is proud to participate in this investment with CPC through the Public Private Apartment Rehabilitation Program. We appreciate the work of our partners.”
Built in 1970, 18-36 Columbus Avenue is a limited stock co-op originally funded by the Federal Housing and Urban Development Agency. In the fall of 2018, OAG launched an investigation into co-op operations following complaints from residents. When the building’s operator, Spring He Valley Housing Development Fund (HDFC), was facing financial troubles in his 2014, Mainardi asked the former board chairman to help finance the cooperative, according to a survey. I persuaded him to hire me for this, but charged an inflated rate. Mainardi has never worked for a low-income cooperative and misrepresented his experience and background, hiding felony convictions for mortgage fraud and tax evasion. He then placed his girlfriend in a position as a “no-show” property manager, and double-billed the co-op for the same administrative tasks that both entities allegedly performed. Mainardi also set the president of the board to be paid as a director and not have to pay for the maintenance of the co-op unit, in violation of the board rules.
Other findings regarding misconduct against Mainardi include:
- Offering fraudulent means to third party lenders to induce them to fund cooperatives.
- When the original lender discovered his fraudulent submissions, the cooperative incurred hundreds of thousands of dollars in unnecessary costs in a second loan.
- Failing to complete promised funding demand projects and receiving hundreds of thousands of dollars in co-op loan proceeds for incomplete and unsatisfactory work.When
- Expenditure of general operating funds for personal goods and services.
As a result of these wrongdoings, Spring Valley HDFC faced foreclosure after a high-interest loan brokered by Mainardi quickly defaulted. Fifty-four low-income co-op shareholders were at risk of losing their home ownership. OAG helped avoid a co-op foreclosure when he recruited RHAC to work with co-op residents to elect a new board. The new board then recruited her RHAC as the cooperative’s new property manager.
of CPC was able to provide a $3.7 million bridge loan to pay off the cooperative’s existing underlying debt and related fees. The CPC loan allowed the cooperative to avoid a planned foreclosure auction and allow the partnership to move forward with its conservation efforts.
As a result of the refinancing, all 54 homes will be affordable for households earning 120% or less of the regional median income. HCR also provided $3 million to him through the state’s Small Building Participation Loan Program to fund modest rehabilitation activities such as roof replacement, safety improvements, and HVAC repairs. CPC is additional Provided $2.8 million in construction loans and more than $2 million in permanent loans for rehabilitation works through a partnership with the New York City Retirement System, administered by the New York City Comptroller’s OfficeThe Mortgage Insurance Fund of the New York State Mortgage Agency provides mortgage insurance for perpetual loans.
“We are proud that the CPC was able to provide the necessary funding to get the co-op back on its feet and, most importantly, prevent residents from foreclosing their homes through the negligence of a few villains. think. ,” Sadie McKean, President of Community Conservation Corporation Said. “With cities across the state facing a housing affordability crisis, consolidating resources to maintain existing affordable homeownership is crucial to the stability and stability of communities like Spring Valley. It’s more important than ever to our vitality, and we thank Attorney General James, HCR Commissioner Visnaukas, partners Nixon Peabody, RHAC and our shareholders for their patience.”
The issue was handled by Home Protection Division Chief Brent Meltzer, Internet Technology Office Attorney General Hannah Bech, and Home Protection Division Jane Landry Reyes. The Division of Housing Protection is part of the Division of Social Justice and is led by Chief Deputy Attorney General Megan Four and overseen by First Deputy Attorney General Jennifer Levy. The Internet Technologies Office is part of the Division of Economic Justice and is overseen by Chief Deputy Attorney General Chris D’Angelo and First Deputy Attorney General Jennifer Levy.