New York Attorney General Letitia James on Monday announced the first settlements under a compliance program targeting buildings designated as “de facto” rent stabilized across New York City.
The Office of the Attorney General secured $90,000 from Deutsche Bank National Trust Company and U.S. Bank National Association after both failed to register rent-stabilized units in Brooklyn with New York State Homes and Community Renewal.
The properties had previously been determined by courts or the state housing agency to fall under rent stabilization because earlier alterations increased unit counts above the legal threshold.
“No matter how big or powerful they are, banks are not above the law, and they cannot get away with failing to protect their tenants,” James said. “My office created this compliance program to ensure all New York City tenants are treated fairly. We will not hesitate to take action against any bank that attempts to circumvent our rent stabilization laws.”
As part of the agreements, 12 units will be returned to rent stabilization. Deutsche Bank will register four units and pay $42,000 in penalties. The U.S. Bank will register eight units, pay $48,000 and cover additional civil penalties tied to separate registration failures.
Since the program launched in May 2025, the office said it has prevented 26 evictions and restored 103 housing units to rent stabilization. Officials sent compliance letters to more than 50 landlords of buildings previously identified as rent stabilized but not properly registered.
Property owners were required to either prove exemption or take corrective steps, including registering legal rents, issuing proper leases, notifying tenants of their rights and certifying compliance.
In the Deutsche Bank case, investigators said the bank acquired a Brooklyn property at a foreclosure sale in 2024 and later attempted to evict tenants from four units, claiming they were not rent-stabilized. After being notified by the Attorney General’s office, the eviction cases were withdrawn. The bank did not meet a later compliance deadline.
In the U.S. Bank matter, officials said the property was acquired at a foreclosure sale in 2023 and later determined to be subject to rent stabilization, but the bank failed to comply after being notified in 2025 and did not meet required deadlines.
