The Torkian Group has agreed to pay the city $300,000 to settle claims that the landlord wrongfully marketed and leased illegal short-term rentals at three of its buildings.
The agreement, finalized on Tuesday, settles allegations against the landlord but not the individuals who were accused of running a scheme through altered listings at Torkian properties on Airbnb, HomeAway and TripAdvisor.
As a condition of its settlement, Torkian must cooperate with the city against other defendants in the lawsuit — including Bedrose, Bedrose broker and former Norman Bobrow and Co. executive vice president David Tordjman and Yohan Atlan, a tax accountant — and ensure that no more apartments are leased illegally. (In New York, landlords are barred from renting apartments for fewer than 30 days in homes where the host is not present.) Bedrose, Atlan and Tordjman are also banned from the buildings as part of the deal with the city.
“Today’s settlement is a victory for the city and further proof that owners who cash rent checks while turning a blind eye to illegal activity can and will be held accountable,” Christian Klossner, executive director of the city’s Office of Special Enforcement, said in a statement.
Representatives for Torkian said it didn’t have any “involvement whatsoever with any alleged illegal activity perpetrated by certain tenants.”
“The Torkian Group is pleased to have amicably resolved all claims with the City of New York with respect to alleged transient use violations without conceding any liability, without any finding of illegal conduct against the Torkian Group, and avoiding further unnecessary litigation costs,” Torkian’s Michael Kirkwood said in a statement.
According to the January lawsuit and subsequent court filings, there were 1,096 short-term rental deals in the landlord’s buildings between February 2015 and October 2018. The transactions involved 17 different apartments at 110 Greenwich Street, 311 West 50th Street and 488 Seventh Avenue, which generated more than $1.1 million in revenue, according to the complaint.
The lawsuit accuses Bedrose, Atlan and Tordjman — referenced as the operator defendants — of illegally advertising units at the Torkian buildings as well as other properties. They allegedly hid their illegal short-term rental business in various ways, including using fake host names on Airbnb and changing the addresses of the buildings slightly. In some cases, guests were instructed to sign fake leases and lie to city officials if questioned about the terms of their stay at the apartments, according to the complaint.
An attorney for the operator defendants couldn’t immediately comment on the case. When reached by phone, Tordjman declined to comment.
In addition to the $300,000 settlement, Torkian has paid the bulk of $120,000 in civil penalties imposed at its three buildings, city officials said.