The California Attorney General’s Office has reached a settlement with multi-family property- flipper Wedgewood that resolves allegations the company wrongfully evicted tenants.
Under the settlement, the Redondo Beach-based company would pay $2.75 million to wrongfully evicted tenants and another $750,000 for civil penalties and towards programs that support tenants, according to the Los Angeles Times.
Wedgewood would also train employees on tenants’ rights and provide periodic updates to the attorney general’s office. A judge must approve the agreement for it to take effect.
Wedgewood’s business model centers on flipping foreclosed properties. The state accused Wedgewood of unlawfully evicting tenants in a variety of ways.
In some instances, the company allegedly told tenants they had to leave their properties well before they were legally allowed to do so. The company allegedly filed erroneous eviction suits and in some cases cut off utilities to force out tenants.
Wedgewood does not admit any wrongdoing in the recent agreement with Attorney General Rob Bonta. The company said in a statement that the state’s accusations regard actions prior to 2016, according to the Mercury News.
A statement from Bonta’s office on Wednesday nonetheless said that Wedgewood’s tactics “harmed hundreds if not thousands of California tenants and their families — mainly in low income and minority communities.”
Wedgewood came to national attention in 2019 when homeless mothers took over one of their rental homes in West Oakland for two months in a protest of property speculation. Wedgewood eventually sold the property to the nonprofit group Oakland Community Trust.
Wedgewood buys and flips properties across California and the country. The firm focuses on flipping single-family properties, but also buys multifamily properties.
In 2018, Wedgewood bought a 130-unit complex, in Santa Clarita from Sikand Properties and a four-plex complex in Inglewood from its long-time individual owner.
The firm also branched out into lending and brokering, but earlier this year sold off its multifamily lending wing to PacWest Bancorp.
[LAT] [Mercury News] — Dennis Lynch