Dishonest property management company

Dishonest property management company

Member since 2018 · 4 posts · 0 votes
Hi, I am from the UK and I am assisting my daughter, Jessica who has a property in Rochester, NY that she rents out.

We are desperately looking for some advice and direction in finding a bona fide property management company in Rochester. Jessica has had this Property around 2.5 years but yet to make any return on it despite it being rented out twice now for about 15 months to two different tenants through two different property management companies.

I have a background in the military and police, have my own business still connected with law and security so i’m up to speed with British law but I’m aware this is likely to be different in the US.

I believe that one property management company, our current one may have committed fraud against us.
Long and short of it I have gone through 3 months of accounts with the current property management company any found discrepancies where there are several duplications of invoices for the same work done within a few days of each other, invoice totals slightly varying. ie. End of July 2018 and beginning of August 2018 the property had minor electrical work, deep clean throughout and large amount vegetation cut in the yard, twice, within 8 days of each other. One bill was $540 and the other $594. This type of duplication was repeated for a three month period bringing our outgoings to around $3000! There was only around $1600 in the pot when they took over the property in June. The last email i had from the management company was over two weeks ago. They stated the sewerage pipe in the basement was damaged and needed immediate repair that would cost $2000. I had several emails from the management company over a few days period and when I questioned the urgency or what had caused this damage I was informed unless I transferred $2000 that same day into the account they would immediately terminate our agreement.
I was left with no choice but to borrow money and transfer the $2000 but had no idea of the damage, any documentation or pictures indicating this serious and grave situation to the current tenants and the conditions they were living in.
This was all over two weeks ago. I have since sent two emails to the Director and his office manager for an update to the repair work and my queries over the duplicated invoices. I have not had any reply whatsoever.


I am still hopeful there is a perfectly plausible reason and explanation for all of this. I researched this company fairly well on the internet and they have a lot of positive feedback though I know this could be fabricated but had little else to go on to ensure we found a property management company who would look after our interests.

Is anyone able  a/ provide property management services for our 3 bedroomed detached house in Rochester and b/ assist in directing us to an official, the police, Rochester City or how would I file a crime report?
0Reply
37 views

Most Popular Reply

China, ME · Member since 2014 · 3k+ posts · 4k+ votes
7y

@Pete Meadowssmith  Attorneys will be expensive, but we have a system called "Small Claims Court".  Here's some data for NY:

http://www.rurallawcenter.org/docs/Guide%20to%20Sm...

In this court, plaintiffs are able to represent themselves without an attorney.  I've done it in Massachusetts, though each state will have different laws.  

It appears that NY has a limit of $5,000, though if the total is above that amount, I wonder whether you could bring a small claims action for each of the duplicate charges under the theory that each was a separate act.  

It might be worth paying a local attorney for a consult to see whether that would work or not.  The other thing the attorney cold do is to write a letter demanding reimbursement of the fraudulent charges and threaten to sue them if payment is not made promptly.

You don't mention whether Jessica lives in Rochester, but if she does, it might be time for her to get hands on - at least to the point that she personally looks at each repair and hires contractors directly.  www.homeadvisor.com and www.angieslist.com are good sources for contractors and both sites offer feedback from the public on the contractor's performance.

That and I would terminate the PM company instantly and make sure that they don't have access to another cent of your money.

Good luck!

See this reply in the discussion

16 Replies

Jump to latestLatest
  • Member since 2018 · 124 posts · 53 votes
    7y
    @Pete Meadowssmith if you believe that fraud happens then you need to hIre local lawyers
  • Member since 2018 · 4 posts · 0 votes
    7y

    Thanks Shmuel, would this not be classed as a crime that the Police would investigate? To get lawyers involved I'm looking at spending a lot of money even if I was to win the case. 

    In the UK the Police would take this on as fraud/theft is classed as a criminal case that the Crown Prosecution Service would follow through with

  • China, ME · Member since 2014 · 3k+ posts · 4k+ votes
    7y

    @Pete Meadowssmith  Attorneys will be expensive, but we have a system called "Small Claims Court".  Here's some data for NY:

    http://www.rurallawcenter.org/docs/Guide%20to%20Sm...

    In this court, plaintiffs are able to represent themselves without an attorney.  I've done it in Massachusetts, though each state will have different laws.  

    It appears that NY has a limit of $5,000, though if the total is above that amount, I wonder whether you could bring a small claims action for each of the duplicate charges under the theory that each was a separate act.  

    It might be worth paying a local attorney for a consult to see whether that would work or not.  The other thing the attorney cold do is to write a letter demanding reimbursement of the fraudulent charges and threaten to sue them if payment is not made promptly.

    You don't mention whether Jessica lives in Rochester, but if she does, it might be time for her to get hands on - at least to the point that she personally looks at each repair and hires contractors directly.  www.homeadvisor.com and www.angieslist.com are good sources for contractors and both sites offer feedback from the public on the contractor's performance.

    That and I would terminate the PM company instantly and make sure that they don't have access to another cent of your money.

    Good luck!

  • Robert GilstrapPro Member
    Residential Real Estate Broker · Cartersville, GA · Member since 2015 · 575 posts · 581 votes
    7y

    @Pete Meadowssmith sounds like you are jumping to conclusions here on calling this fraud. You stated you've gone through 3 months invoices and found what seems like duplicated invoices, then you jump to a sewer issue that we have no evidence of it being fraudulent just that you've sent the PM money to deal with it. So right now you have 3 invoices that look funny and you want answers.  Then you said you've sent 2 emails in the last 2 weeks with no response on the sewer issue. 

    So in the future you need to audit and watch your account in real time, not weeks or months later. Unless they are some tiny operation they should have an online portal for you to review invoices, statements and pictures of repair work. If they don't have that you chose the wrong mgmt. company. If they do but you fail to monitor it then you are not doing your job as an owner. Remember they are your employee and you need to watch them just like anybody else you hire.

    You should have a set $$ amount that requires your authorization before an expenditure is made like $350 or $500, what is that amount?

    Don't just email; pick up the telephone and call and stay on the phone until you get clarity on the situation. Call everyday  or multiple times a day until you get to who you need. Record the call if possible. Find out who the broker is and contact that person direct with your concerns.

    Find out what govmt agency regulates and licenses property management companies in New York and contact them if you can't get resolution.

    I can assure you that nobody goes into the property management business to defraud people. It's too complex and too regulated and quite frankly there are easier ways to cheat someone. Bad communication is common however and it sounds like that is the issue. 

  • Member since 2018 · 4 posts · 0 votes
    7y

    @Charlie MacPherson  

    Thank you ever so much, this is a great help. It might cost as it would mean a personal appearance by Jess (as she's the home owner) but at least this person/company will think twice about committing such an act again.

    Neither of us live in the US. Jess passes through every so often picking up casual work to tie her over. She's up in Canada at the moment, then US for Xmas and possible plans for working down Australia as the Visa there is for 2 years 

    I've looked at www.angieslist.com and unfortunately to view their recommended contractors and feedback you have to be a US resident. Though I've just thought of perhaps giving the rental property as the address! Doh!

    Kind regards

    Pete 

    www.salientuk.com 

  • Rental Property Investor · Queens, NY · Member since 2018 · 99 posts · 70 votes
    7y

    @Pete Meadowssmith Sorry to hear that, maybe you can consider installing security camera outside the house and in the basement where all the stuff needs maintenance with, so you can check if the grass were needed to be cut or not and if the sewer was acutally fixed. 

    Other option is to sell the property if your actually losing money from it. 

  • Real Estate Agent · Cupertino, CA · Member since 2016 · 4k+ posts · 1k+ votes
    7y

    Difficult to get a government agency to pin point whether there is fraud or negligence.  You need to immediately change your property manager since the current manager hinted they want you to end relationship as well. This is the kind of damage a judge at Small Claim Court can handle if you file charges only you appear in person. You can win but not able to get your money back also. You can try NY department of Real Estate License file a complaint to get the property manager excited as it affects their ability to stay in business.

    I am not surprised that you are running in red in a town like Rochester with high un-employment. 6% is way too high to get decent rent. 

    Good luck.   

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y

    property managers are licensed by the state .. threanting to file a complaint for trust account violations will get their attention.. this is the number 1 reason they lose their licenses.. the police will not do anything about this unless 50 people have come in on the same issues.

    keep in mind some of the US and UK turn key guys really promoted Rochester and Buffalo and the vast majority of these are pretty tough to manage assets from afar.. there was even some legislation trying to control the US and UK marketers that were buying 5k houses and selling them to unsuspecting GB investors for HUGE profits.. I mean Huge. 

    this may never change and a sale of the asset may be apprpriate.. but if you want to rattle cages with the PM most licensed folks will take note if you threaten to file a complaint of missappropriation of trust money to the state department of real estate.. they are the ones that will go in and audit them.

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y

    PS filing a complaint with the DRE is free

  • Member since 2018 · 4 posts · 0 votes
    7y

    Thank you all for your help. It is very much appreciated.

    Kind regards, Pete

  • Kansas City MO · Member since 2014 · 357 posts · 349 votes
    7y

    @Pete Meadowssmith  My recommendation is to get ahold of your tenant in this property and ask them about your repairs...ask them directly what work the property mngt has done and about the sewer problem. And if they have photos ask them to email that to you. That should tell you what you need to know about these repairs being legit or not. Unfortunately it wouldn't really surprise me it they're being shady.  Some of the PMs I've met here are too dishonest &/or inept to even flip burgers at McDonalds. 

  • Matthew Irish-JonesBusiness Member
    Real Estate Agent · Buffalo, NY · Member since 2017 · 2k+ posts · 2k+ votes
    7y

    @Pete Meadowssmith

    I'm not taking a side in this issue but... A property Manager does have a responsibility to deal with any health and safety issues immediately.  A sewer back up can definitely be considered a health and safety issue, and I "could" understand why they would need immediate payment to deal with this issue.

    I would assume this is spelled out in the contract you signed with the PM company.  Is there a clause for health and safety?  Also, is there a clause for keeping a minimum balance in an account for repairs?

    Like previously mentioned, a job this big should come with before and after pictures.  Also, their should be a sign in portal where you can view, invoices, cash flow, pictures, etc... 

    Why don't you give this company a call?  For an expense this big I would expect the PM company to be providing really great documentation of what the issue is or.... if you are not receiving that... You have a right to ask for it... I would start with a phone call though.

    If there was an issue with the main line or sewer line coming into the house, $2,000 to repair is not out of the question or really even that expensive, assuming it was indeed the main sewer line that needed to be repaired.  Again, I would be asking for specific details on what was fixed, and what the issue was.  

    Once you have that call a local plumbing company, give them the details and ask what a ball park cost would be.  

    -Good luck!

    Irish Jones Realty4.947 Reviews
    View Page
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y
    Originally posted by @Laura Williams:

    @Pete Meadowssmith  My recommendation is to get ahold of your tenant in this property and ask them about your repairs...ask them directly what work the property mngt has done and about the sewer problem. And if they have photos ask them to email that to you. That should tell you what you need to know about these repairs being legit or not. Unfortunately it wouldn't really surprise me it they're being shady.  Some of the PMs I've met here are too dishonest &/or inept to even flip burgers at McDonalds. 

    while I like this thought..  tenants though if its C class type stuff can be highly un reliable..  so do need to take with a grain of salt :) 

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y
    Originally posted by @Matthew Irish-Jones:

    @Pete Meadowssmith

    I'm not taking a side in this issue but... A property Manager does have a responsibility to deal with any health and safety issues immediately.  A sewer back up can definitely be considered a health and safety issue, and I "could" understand why they would need immediate payment to deal with this issue.

    I would assume this is spelled out in the contract you signed with the PM company.  Is there a clause for health and safety?  Also, is there a clause for keeping a minimum balance in an account for repairs?

    Like previously mentioned, a job this big should come with before and after pictures.  Also, their should be a sign in portal where you can view, invoices, cash flow, pictures, etc... 

    Why don't you give this company a call?  For an expense this big I would expect the PM company to be providing really great documentation of what the issue is or.... if you are not receiving that... You have a right to ask for it... I would start with a phone call though.

    If there was an issue with the main line or sewer line coming into the house, $2,000 to repair is not out of the question or really even that expensive, assuming it was indeed the main sewer line that needed to be repaired.  Again, I would be asking for specific details on what was fixed, and what the issue was.  

    Once you have that call a local plumbing company, give them the details and ask what a ball park cost would be.  

    -Good luck!

    replace main sewer lines to the street vary a lot by location. in Portland we pay 3 to 5k easy for that.  

  • Rental Property Investor · Durham, NC · Member since 2014 · 1k+ posts · 1k+ votes
    7y

    @Pete Meadowssmith,

    What condition was the property in when your daughter acquired it?  Did she buy it strictly as an investment property or did she live in it and rent it only when she moved away?

    While the maintenance/repair issues *might* appear to be unfair, it may be that the property was misrepresented to her when she bought it and/or bad timing was that she bought it as it was falling into unseen disrepair.  Electrical and sewer line are two things that could be going bad behind the walls and under the ground and an unsuspecting buyer could purchase and never know ... until a couple of years later when one repair after another needs to be performed.


    I agree with those that said it may be time to simply sell the place.  If you're not making money after two+ years, and if in fact you are now spending more money to maintain it, just sell it.  If these are legitimate repairs, there might be several more on the horizon.  Let the new owner deal with them.

  • Member since 2021 · 6 posts · 1 vote
    3y

    Avoid RACE Properties. They were terrible!!

Join the conversationCreate a free account to reply, vote on answers and follow this thread.