ATLANTA — The country's largest landlord will pay the government $48 million in a settlement announced Tuesday for a range of exploitative business practices, according to a Federal Trade Commission release.
The FTC said it had taken action in Atlanta federal court against Invitation Homes for unfair evictions, withholding security deposits, charging junk fees and deceiving renters about lease costs, among other unlawful practices.
Under the settlement, Invitation Homes will be required to notify renters about eviction assistance programs and be prohibited from filing evictions against renters who have already moved out. The company will also be prohibited from withholding security deposits for damages "that are part of normal wear and tear" or from using security deposit money on other issues or covering maintenance and repair costs not related to any damage caused by a renter.
“Invitation Homes, the nation’s largest single-family home landlord, preyed on tenants through a variety of unfair and deceptive tactics, from saddling people with hidden fees and unjustly withholding security deposits to misleading people about eviction policies during the pandemic and even pursuing eviction proceedings after people had moved out,” FTC Chair Lina M. Khan said in a release. “No American should pay more for rent or be kicked out of their home because of illegal tactics by corporate landlords. The FTC will continue to use all our tools to protect renters from unlawful business practices.”
According to the FTC release, the unfair eviction practices involved steering renters away from filing a CDC declaration to prevent eviction during the COVID-19 pandemic and instead pushing them toward Invitation Homes' own "hardship affidavit" that provided no protections against eviction.
The eviction practices, the FTC said, went so far as the company directing its call centers to withhold information on the CDC declaration.
"When consumers would reach out to company employees for help, employees regularly failed to inform renters about their option to file the CDC declaration, instead falsely telling tenants their only options were to pay rent, accept a balance forgiveness and move out, or undergo the eviction process," the FTC said.
Additionally, Invitation Homes was alleged to have "even started eviction proceedings against renters who the company knew had already moved out of their houses, which in some cases resulted in eviction filings appearing on tenant screening reports, making it harder for them to rent houses in the future."
The FTC Invitation Homes' practice of withholding security deposits was "systematic and included unfairly charging renters for normal wear-and-tear, damages that existed before renters moved in and even renovations that were not the renters' responsibility.
In some regions the company was "charging renters for all repairs by default and reviewing charges only when residents disputed them." The FTC found that Invitation Homes returned security deposits only about 40% of the time, well below the national average of about 64%.
The company had also been accused of charging "mandatory junk fees" totaling more than $1,700 a year. Invitation Homes allegedly collected more than $18 million in such fees since 2019.
"The complaint cites a 2019 email from Invitation Homes’ CEO calling on the senior vice president responsible for overseeing the company’s fee program to 'juice this hog' by making the smart home fee mandatory for renters," the release stated.
According to the FTC, the settlement will still need approval from a federal judge.