The Federal Trade Commission shut down a series of real estate websites that allegedly targeted Section 8 voucher recipients and falsely promised “exclusive” access to rental listings in exchange for a monthly or weekly subscription fee.
According to the FTC, two brothers, Steven and Kevin (Kaveh) Shayan, owned four companies and operated a series of real estate websites that offered prospective renters “hundreds of thousands of accurate, up-to-date, and available listings” if they paid a fee to access the listings, when the opposite was allegedly the case.
The FTC claims that the Shayan brothers’ companies, Apartment Hunters, Real Estate Data Solutions, Rental Home Listings, and UAB Apartment Hunters, and their websites, WeTakeSection8.com, ApartmentHunterz.com, and FeaturedRentals.com, actually offered out-of-date listings, including many that did not accept Section 8 vouchers as promised.
“Today’s housing market is historically tight, and affordable rentals are harder to find than ever. Section 8 voucher recipients have it even harder: they have fewer rentals from which to choose and their vouchers expire if not used within a specified period of time,” said Andrew Smith, the FTC’s director of the bureau of consumer protection.
“In this case, we allege that defendants misled consumers—including Section 8 voucher recipients—into purchasing subscriptions to worthless lists of stale apartment listings, and the consumers then wasted their valuable time shopping for rentals that were not in fact available,” Smith added.
According to the FTC, the websites charged $49 for two months of access to contact information for the property managers of the rental listings on the sites, and $14.99 for a weekly subscription.
For those fees, renters were promised access to rental listings that weren’t available on other free listings sites, but the FTC alleged that those claims were “misleading, false, or unsubstantiated.”
The FTC also claims that WeTakeSection8.com falsely claimed to have access to listings that would accept Section 8 vouchers, which are used by low-income families, elderly, and disabled persons to gain access to affordable housing.
From the FTC’s complaint:
Defendants charge consumers a fee to access contact information for property managers of rental units listed on their websites. Defendants represent to consumers that the listings on their websites are accurate, up-to-date, and available, that consumers are likely to find suitable housing within a short time, and that consumers cannot find these listings on free websites. These representations are misleading, false, or unsubstantiated.
For example, the majority of the listings on WeTakeSection8.com are not available for rent, and most of those units that are available for rent do not accept Section 8 payments. Consumers lose money and valuable time because of Defendants’ deceptive marketing.
The FTC also noted that the California Department of Real Estate revoked Apartment Hunters’ business license in 2015, but the company has continued to operate since then without a license.
At the request of the FTC, a federal court issued a temporary restraining order prohibiting the Shayan brothers and their four companies and their associated real estate sites from making false claims in the marketing of rental listings.