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2006, 2016 by David v. GOLIATH [d2]

"Come into my parlor, and be sure to bring a large deposit"

The following story is true. Only the names have been changed to protect the writers. It unfolds
hundreds of times each year in Los Angeles. Though the city was named after agents from up above, it is
more often under siege by those from down below.
It begins when the unsuspecting victim rents an apartment in the spider's web. The law allows the
predator to suck a security deposit from his prey up front. The reason for this is to protect the arachnid from
bad tenants. It is a necessary evil, as there are many crooks who pose as renters. But somehow it
neglected to protect the law abiding citizen from the Bad Unscrupulous Land Lord Imposter, Embezzler &
Extortionist (aka BULLIEE).
Assume for the moment that the building comes under rent control. The unit may or may not be
ready to occupy, and any needed repairs may or may not have been done prior to the move-in. Either way,
most necessary maintenance during the term of residency is neglected. This is partly done in order for the
millionaire miser to save the cost of repairs. The other reason is to soften up the occupant for excrementing.
This gives the perpetrator two major benefits. Since he is not legally allowed to frequently jack up the
rent to drive them out, the BULLIEE must somehow get rid of the old lower paying tenants when the market
rises in order to replace them with new higher paying ones. In the case of pre-existing long-term residents
who may be at a much lower rent level, he has been known to engage in what is called "constructive
eviction" to try and coerce them to move. These occupants will usually become a priority for termination
because the predator considers them to be "costing him" even more profits than the others.
The other benefit is that it also provides him with the opportunity to add another free deposit to his
coffers. Although the law "requires" the predator to return the old renter's deposit, and even allows for
damages as a deterrent for stealing it (CC 1950.5), that is NOT what is going to happen! While it may
seem illogical and a poor business practice to cheat and intentionally eliminate good customers, a BULLIEE
is more interested in acquiring as much money as possible in the short term than he is in any long term
effects. That is because he is only pretending to be a landlord as he is just temporarily holding the property
for the short term profits. He just wants to suck what he can take from the property and the people, and
when he is done he'll stick some real landlord with the results of his mess.
Many of them seem to buy and sell the buildings back and forth to artificially inflate the price, and
frequently reacquire the same real estate at the higher level. Sometimes they even buy and sell the same
property to themselves under another name! By driving up the price, they not only profit from the inflated
equity, but also from the higher rents that can be charged because of that, along with the increased deposit
amounts they can steal. Some of these back and forth transfers may not actually involve the full amount, or
even any funds being exchanged. Tenants just get treated as though they were chaff incidentally caught in
the wind of their wake, rather than like the very foundation of the rental industry.

Legal Inconsiderations
Naturally these deposit thefts leave the BULLIEE open to potential law suits, but they have that
covered, too. For starters, the law only allows for "up to" triple the amount with the statutory damages
imposed. If that award was made every single time they went to court, and one out of every three
victims sued them, it would not cost them a cent beyond minimal court expenses. The fact is, for a number
of reasons that will never even happen!
Many of the temporary judicial officials who decide the vast majority of small claims cases are also
landlords themselves, and virtually none of them are tenants. As humans, most of them begin, consciously
or not, with bias against the plaintiff, and do not even have the incentive of an oath of office to encourage
them to overcome it. Since the law does not require the penalty to be imposed, even when a case is
decided in the tenant's favor, he still loses because it is rare that any damages or even interest are ever
actually awarded. That means that the crook not only skates without penalty, but even gets out of some of
his actual obligation to the victim. Yet most plaintiffs feel lucky to have recovered their original investment,
despite having had to earn it back again!

The predator has his song and dance all worked out in advance. He claims that it was just an
oversight, inadvertent, and probably his manager's fault, as if that relieves him of his responsibility. He acts
as if it is just a fluke, a one time occurrence, and his victim is trying to capitalize on a chance to rip-off the
poor millionaire.
Despite totally ignoring the tenants' repeated request for their refund, rudely hanging up on them if
they ever catch him by phone, and even going so far as to dare "Why don't you sue me?", his big defense is
"I didn't know." As his victim is inexperienced and concentrating on trying to recover his stolen money, he
would never think to research his antagonist's history.
The bench is generally more interested in disposing of the case than seeing anything as irrelevant"
or "immaterial" as evidence. Even though he may have been sued for this same thing dozens of times
before, they only want to focus on this particular time exclusively. Even if he appears before a real judge
(one who has sworn to uphold the law) or a pro-tem or commissioner who actually tries to rule fairly based
on the merits of the case, the chances of being recognized as a repeat offender are extremely slim. Since
he goes to courthouses all over the county and there are so many different adjudicators in each location, he
hardly ever comes before the same one often enough to be remembered, and they invariably buy into his
repetitious ploy.
The bottom line is that he will almost never have to pay anything more than occasional court costs
over giving back the original deposit. That means he gets off practically free nearly every time he gets
caught and taken to task for it, and is rewarded with the entire amount from victims who don't accomplish
this formidable chore.
The BULLIEE has other distinctive advantages as well since he is quite experienced and gets plenty
of practice to employ his strategies, which have been perfected by him and his cohorts for many years. He
is quite familiar with the process and knows he has almost nothing to lose. He can schedule his time as
needed and doesn't even have to bother with it at all until his opponent figures out and meets all the
requirements of getting him into court. He doesn't have to put up a cent unless he loses and can keep using
his victim's money until then.
Each time this takes place, he is going up against a different victim, and so whatever the last one
learned from that experience will never be used against him by anyone else. He only has to face one
opponent at a time, so no matter how many of them come after him, he only has to answer for one single
action in any given appearance, the same as if there never was any other. Sometimes he even knows the
judge from having appeared before him to evict other tenants. He also knows he can lie with impunity in
court while the naive former tenant will most likely tell "nothing but the truth." Compromises tend to wind up
somewhere between the claimed extremes regardless of whether they are factual or exaggerated.
The renters have usually never had to go through the court process before, and have no idea what to
do, how to do it without making costly mistakes, or how difficult and time consuming it will be. They have to
take time off from work, not just for the hearings, but every time they have to file a form or correct a mistake.
They often have to almost start over, and sometimes wind up finding that the cost to them is more than what
they stand to gain by fighting back. They usually don't allow for indirect expenses such as additional child
care, transportation and lost time from work. Sometimes their job is even jeopardized because of this. They
can't afford to lose, have to put up all the court costs in advance with no guarantee of recovering them, and
have the responsibility to make sure everybody does everything right. Usually they have just recently
moved and had to put up another deposit along with overlapping rents and probably at a higher rate. They
may know the deck is stacked against them, but most likely have no idea just how high.
There is also another distinct advantage for the perpetrator. Since he has already shown that he has
no compunctions about breaking laws, his adversaries will find that he has already done that from the start
in order to prevent them from being able to sue. The law (CC 1962) clearly states that landlords must tell
tenants who the people are behind the company that owns the property and where to have them served for
lawsuits. Not only has he violated this one in advance, but he has taken further steps to prevent renters
from being able to obtain that information necessary to bring him to court. Most of them use a fictitious
name such as "F. U. Partnership," at a mail drop address with a disposable cell phone number, all of which
can be easily changed as needed. This means that even if victims are willing to pursue him, they will hit
another obstacle that often turns out to be too much to overcome.

Playing the percentages

When you consider that most tenants do not bother to try to sue him in the first place, the profits from
his thefts are enormous, especially if he holds control over a lot of buildings. Suppose an owner has 50
properties with an average of ten units in each one. Let's say he only collects as a deposit $500 per unit,
less than one month's rent. That means he has amassed a quarter of a million dollars of other peoples?
money to do with what he likes. While only occasional local laws even "require" a tiny interest amount to be
repaid, the fact that he keeps practically all of the principle and pays absolutely no interest means that he is
actually guilty of grand theft on a grandiose scale.
While they say that only one in a hundred bother to file complaints, this number is significantly less
when it comes to filing lawsuits. Although most predators may not have this many holdings, when they work
together it can be considerably more. You can just increase or reduce these figures proportionately and they
will still be approximately correct for the purpose of this example. Even if a whopping 10% of his victims
sue, and all of them not only manage to get him into court but actually win and collect the maximum of
triple with damages plus maybe $50 in court costs, his rake is 70% of $250,000, less about $2500
expenses or $172,500!!!
That total is clear undeclared profit from his victims' money with absolutely NO investment out of his
own pocket. That is also with penalties imposed to the fullest extent of the law without even considering
other factors that tend to increase that amount. Some of those other factors are:
most rents and deposits are for significantly more than $500, and he can legally charge up to twice
the monthly rent for a deposit;
most court awards are only for the deposit without damages, or one third of the example amount;
many apartment complexes have a lot more than ten units;
the number of tenants that actually succeed at recovering their money is probably less than two
percent rather than the ten percent illustrated above;
and this does not take into account the additional money generated by attrition, both natural and
coerced. Therefore the gains realized from these intentional violations are substantially higher than indicated
in the above example.
The authorities seem completely unconcerned about this perennial embezzlement taking place.
There is no way a victim alone can bring charges against any of them for the purpose of prosecution. There
is no agency that even wants to be bothered with taking a complaint, let alone following up with an
investigation on one. Even when one does, it generally finds in the BULLIEE's favor because it is not only
easier, but often more profitable to do that.
As it stands now, the laws coupled with their lack of enforcement tend be more of an incentive to
perpetuate and accelerate these patterns and practices than a deterrent to them. This will only continue and
escalate until some kind of affirmative action is undertaken to bring it to an ultimate culmination.


Learn what it's all about on our previous home page.
What is C.A.P.I.T.A.L.?
Landlords are not the enemy!
Landlords and Tenants as Allies
Meet the real enemy; find out if you may be a victim.
Bad Unscrupulous LandLord Imposter, Embezzler & Extortionist (aka BULLIEE)

Email us: 10jr@gmx.com