News Summary
Greystar Real Estate Partners was ordered by the Justice Department to pay over $1.4 million for illegally charging U.S. military servicemembers fees upon lease termination due to military relocation orders. The settlement includes $1.35 million for affected servicemembers and requires company-wide policy changes to comply with the Servicemembers Civil Relief Act. This case underlines the importance of protecting military families from exploitative practices.
Charleston – Greystar Real Estate Partners, the largest property management company in the United States, has been ordered by the Justice Department (DOJ) to pay more than $1.4 million following allegations of imposing illegal fees on U.S. military servicemembers. These fees were charged to those who terminated their leases upon receiving military relocation orders, a practice that violates the Servicemembers Civil Relief Act (SCRA).
The settlement includes a total payout of $1.35 million designated for affected military members and their co-tenants, alongside a civil penalty of $77,370 to be paid by Greystar. This resolution aims to address the unlawful charges that were automatically applied through a software system used by the company, which incorrectly classified the servicemembers as ineligible for lease termination relief provided under federal law.
In addition to the monetary penalties, Greystar will be required to implement significant policy changes within six months. These changes include adopting SCRA-compliant software and modifying lease forms to ensure compliance with the law across all its properties. The company must also provide annual training for employees involved in handling lease agreements and terminations, further safeguarding the rights of military families.
The allegations against Greystar highlight the essential protections afforded to military servicemembers under the SCRA, aimed at preventing unfair financial burdens when they are called to active duty or relocated. Legal representatives from the DOJ emphasized their commitment to protecting these rights, asserting the importance of upholding laws designed to safeguard military families from exploitative practices.
Greystar manages over 3,700 communities and approximately 800,000 housing units nationwide, maintaining a significant presence in the real estate sector. Its investment management platform oversees more than $78 billion in assets, and Forbes estimates the company manages upwards of $320 billion in global real estate. The firm’s CEO, Robert “Bob” Faith, is noted as the richest individual in South Carolina, with an estimated net worth of $5 billion.
This settlement arrives in the context of previous legal challenges the company has faced. In January, Greystar was sued by the DOJ over allegations of collusion with other landlords to artificially inflate rental prices through what was described as an algorithmic scheme. Greystar has denied any wrongdoing associated with anti-competitive practices and expressed its intention to defend itself vigorously in court.
The legal actions and subsequent settlements are significant not only for the financial compensation to servicemembers but also for the broader implications they have on the property management industry regarding compliance with federal regulations. The ongoing scrutiny of Greystar’s practices may lead to enhanced protections for military families across the nation as awareness of such issues grows.
Through these developments, the Justice Department continues to send a strong message regarding the enforcement of the SCRA and the protection of the rights of those who serve in the military. With the new measures set to be implemented by Greystar, there is an anticipated push for greater accountability and compliance within the property management sector moving forward.
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