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Report: Siegel Group execs used deception, harassment to evict tenants during COVID

Updated August 2, 2022 - 11:04 am

Executives at The Siegel Group employed aggressive practices, including deception and harassment, to evict tenants during the COVID-19 pandemic, a U.S. House panel investigation has found.

Documents showed the Las Vegas-based landlord used tactics to “bluff” renters into falsely believing the Centers for Disease Control and Prevention’s eviction moratorium was no longer in effect, a suspected violation of federal law, according to a scathing report released Thursday.

“While the abusive eviction practices documented in this report would be condemnable under any circumstances, they are unconscionable during a once-in-a-century economic and public health crisis,” wrote Rep. James Clyburn, chairman of the panel and House Majority Whip, in a statement.

[ Update: The Siegel Group under new scrutiny by county, AG office for evictions ]

The Select Subcommittee on the Coronavirus Crisis spent the last year scrutinizing whether four corporate landlords engaged in pandemic eviction abuse, but the resulting 41-page report emphasized The Siegel Group’s practices were “uniquely egregious” at a time when the company received millions in federal relief.

The report states Siegel employees were given a list of suggested harassment tactics to force tenants to leave.

In one instance from May 2021, a company executive proposed ways to “get rid” of a past-due tenant in San Antonio. That included swapping her working air-conditioning unit with a broken one, having security knock on her room’s door at least twice a night, and calling child protective services “to come out” if there were too many people in her room.

“I want this person very uncomfortable sitting in our room for free,” senior vice president of operations Mike Tisdale wrote in the email, which was published by investigators.

The panel has asked Texas authorities to investigate whether the company’s employees made any false reports of child abuse or neglect about the tenant, a felony under state law, according to the report. A Department of Family and Protective Services official confirmed Thursday that the agency was looking into the matter.

The House panel also referred its findings to two federal watchdog agencies — the Federal Trade Commission and Consumer Financial Protection Bureau — for further investigation into whether The Siegel Group’s actions would be considered deceptive and unfair business practices, according to letters dated Thursday.

Officials deeply concerned

Top state officials said they were deeply concerned about the practices documented by the House panel.

Gov. Steve Sisolak was “appalled and dismayed” by corporate landlords that “benefited off of and abused vulnerable Nevada families,” according to an email from his office.

“It is clear they put profits over people,” he said.

Nevada Attorney General Aaron Ford called the report “shocking and disturbing” in a written statement. His staff will review the document for possible violations of state laws and directives on pandemic evictions.

The Siegel Group, which operates a chain of hotel-apartment hybrids with approximately 12,000 units across eight states, suffered “almost no revenue decline” during the early period of the pandemic, the panel found. As of mid-2021, more than two dozen of the company’s Siegel Suites and Siegel Select locations were located in the Las Vegas Valley, totaling about 4,000 rental units, property records show.

In a statement, a Siegel attorney wrote company officials were surprised they were not called before the report’s release.

“The Siegel Group has at all times been committed to abiding by the letter and the spirit of the law applicable to our operations. We will continue to put roofs over people’s heads and keep people employed,” wrote Sean Thueson, executive vice president and general counsel. “This is what we have always done. SIEGEL CARES!”

‘Bluff people out’

Many of the investigation’s findings focus on Siegel’s actions in May 2021, documented in several internal emails the panel obtained and published.

At Tisdale’s repeated direction, employees began to post and provide tenants with a copy of a recent federal court ruling that invalidated the CDC’s moratorium, the report states.

However, the tenants were not told that U.S. District Judge Dabney L. Friedrich had also immediately stayed her decision pending an appeal, the investigation’s findings show. The moratorium was ultimately left in effect until it expired that July.

On May 10, a general manager at a Boulder Highway property described distributing copies of the ruling to tenants.

“I love getting to say that this means the eviction may happen sooner than expected and seeing the look on their faces,” the manager wrote, adding a smiley face icon to the end of the sentence.

Tisdale indicated that the company’s strategy was working in an email sent a week later.

“I am hearing positive feedback from the properties that have been using this order to bluff people out,” he wrote. “I hope you all are doing the same.”

Later that month, in his email about the past-due San Antonio tenant, Tisdale directed employees to give her a copy of the judge’s ruling after 5 p.m. on a Friday so that the tenant could not call court or law enforcement officials to confirm whether it was valid, according to the report.

“Let her know when the constable comes she will only have 5 minutes to get all her stuff,” Tisdale wrote. “Lets (sic) see if she vacates over the weekend.”

Legal Aid Center of Southern Nevada attorney Jim Berchtold said the investigation’s findings supported what he had heard from many clients who lived at Las Vegas Valley properties during the pandemic.

“It really was a laundry list of all the deplorable actions that we had seen happening over the last few years,” he said.

Millions in aid, hundreds of evictions

The House panel launched its investigation in July 2021, following reports that The Siegel Group and other landlords were moving to evict tenants at high rates, despite the CDC’s moratorium and Congress allocating over $46 billion in federal rental assistance.

Clyburn cited a recent Las Vegas Review-Journal investigation as part of his announcement.

The article revealed that law enforcement agencies received some 450 eviction orders to carry out at The Siegel Group properties in Southern Nevada between April and December 2020.

Many of the evictions took place while either a statewide or federal eviction moratoria were in effect for tenants behind on rent. However, court records showed the properties primarily removed tenants using “no cause” evictions, which were not explicitly covered by the moratoria.

The panel’s investigation covered evictions filed through July 2021 by The Siegel Group and three other landlords — Ventron Management, Pretium Partners and Invitation Homes. More than 50,000 documents obtained from the four companies were reviewed, the report states.

Investigators knew of 573 eviction filings from The Siegel Group when they launched their inquiry, but they eventually found about 200 more.

The report states the company filed hundreds of no cause evictions “to try to avoid allowing tenants from receiving CDC moratorium protection from eviction for nonpayment of rent.”

At least 89 tenants were evicted even when they had pending rental assistance applications, including one tenant whose assistance was paid the day she was evicted, the report states.

The true number of evictions, however, could be higher. The Siegel Group does not have a centralized system tracking eviction proceeding data, and company officials admitted it had lost some filing documents, according to the report.

The company received at least $5.5 million in federal relief during the pandemic, including rental assistance and more than $2 million in forgiven Paycheck Protection Program loans, the report states.

Contact Michael Scott Davidson at sdavidson@reviewjournal.com or 702-477-3861. Follow @davidsonlvrj on Twitter.

The Siegel Group, US House … by Las Vegas Review-Journal

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