A protestor outside of the Joneses’ East Third Street building in 2012. (Photo: Laura Edwins for The Local East Village)

Two controversial landlords who paid tenants to leave their rent-regulated apartments in Bushwick have reached a $132,000 settlement, New York Attorney General Eric Schneiderman announced today.

Between June 2016 and July of this year, Graham Jones and his brother Greg Jones gave buyouts to 33 residents– more than a third of the tenants– of three Bushwick buildings they had recently purchased, at 946 Bushwick Avenue, 920 Bushwick Avenue, and 1075 Greene Avenue. While the buyouts themselves were not illegal, the Joneses failed to provide written notices to the tenants informing them of their rights, including their right to refuse the offer and/or consult a lawyer. The landlords said they were unaware of the law, passed in 2015, that prohibits building owners from offering buyouts without giving tenants written notice– an act that falls under the legal definition of harassment. Among other things, the notice informs tenants that landlords are prohibited from contacting them for 180 days, should the tenant refuse a buyout.

The Jones brothers started their company, GRJ, in 2010. In 2015, a New York Times profile outlined their strategy: “Purchase dilapidated buildings at a low price, refurbish them and raise the rents,” with the aim of filling the renovated units with students and young professionals. At the time, the Grahams were 34 and 32, and had already acquired seven buildings. As they flipped them, “tenants fought back, saying that many who had lived in their apartments legally for decades were being offered lowball buyouts or had their power or water turned off with little notice while adjacent apartments were being renovated,” wrote the Times. One tenant “didn’t want to take a buyout… but ultimately agreed because he was bothered by the noisy construction and disruption and what she described as frequent phone calls from the landlords.”

Greg Jones told the Times, “We don’t do anything illegal. We don’t do anything that’s not within our rights.”

When the Grahams bought three East Village buildings for $23.5 million in 2012, some 17 tenants were told their leases wouldn’t be renewed. Even market-rate tenants who were paying around $2,300 per month were told to leave; one began organizing her neighbors, pleading that she didn’t have enough money for a move or enough time to prepare for it. At one point, City Council Member Rosie Mendez participated in a protest outside of the buildings.

After the Graham brothers bought the Bushwick buildings in the summer of 2016, a group of about 30 tenants similarly banded together to allege that their landlords “started construction in the buildings designed to make tenants’ lives so miserable that it encourages them to leave,” according to their staff attorney at Brooklyn Legal Services Corporation A. Today, Martin S. Needelman, the executive director of Brooklyn A, said in a statement that the settlement “demonstrates how such egregious behavior by landlords will not be tolerated in New York City.”

Among the elected officials who praised the settlement today were City Council members Antonio Reynoso and Jumaane Williams. In a statement, Attorney General Schneiderman said the settlement, which will go toward affordable housing, “makes clear that we will aggressively enforce the law to protect tenants from those who seek to put profit before New Yorkers’ rights — and we’ll continue to fight for the tougher state laws we need to criminally crack down on tenant harassment.” The move comes a month after embattled landlord Steve Croman was sentenced to a year in prison and ordered to pay a $5 million fine for multiple counts of mortgage and tax fraud related to his 140 buildings. A civil suit against Croman, brought by Schneiderman, is still pending.