Rental Firm Agrees to Pay $1M for Denying Ex-Cons Leases

November 13, 2019

In a closely watched case, a Queens, N.Y., landlord has agreed to pay $1 million for refusing to rent apartments to applicants who had been incarcerated.

The advocacy group that had sued called the settlement a major legal precedent for any ex-convict who has been prevented from renting a property by a landlord because of their criminal background.

“This settlement fires a warning shot across the bow of any landlord in America who blanketly refuses to rent apartments to people with criminal justice involvement,” says JoAnne Pate, CEO of the Fortune Society, a provider of services for formerly incarcerated people. “Landlords will take notice of its deterrent effect. Many will look more closely at whether they have policies that comport with the law, and they will be concerned about the exposure for costly litigation.”

The Fortune Society sued the owners of Sand Castle, a 917-unit apartment complex, in 2014. They charged that the building had a policy of automatically refusing to rent an apartment to a person with a criminal record. They alleged that the policy did not take into account the nature of conviction or the amount of time that had passed since the person’s conviction. The group accused the firm of violating the Fair Housing Act through its ban on renting to ex-convicts.

The corporations that own and manage the building did not admit wrongdoing in the settlement. The landlords no longer control the building.

The settlement of $1,187,500 is one of the largest settlements for such a lawsuit in denying rentals to ex-convicts, the Fortune Society says.

The attorneys for Sand Castle have not commented publicly on the lawsuit.