U.S. Coast Guard Base Alameda as seen in 2003, with Oakland and San Francisco in the background. Property management company FPI Management Inc., recently was accused of illegally charging members of the Coast Guard here for breaking their lease due to military orders. (Bruce Pimental/U.S. Coast Guard)
A California property management company will pay about $74,000 to settle allegations that it broke federal law by charging military families for breaking their leases early.
FPI Management Inc., headquartered in Folsom, was accused of imposing unlawful fees on nine military members who had to leave their apartments earlier than expected after receiving military orders, the Justice Department said in a statement Tuesday.
The Servicemembers Civil Relief Act protects service members who must break leases due to a change of station, deployment or retirement. It also safeguards them in many situations against evictions, unfair security deposits, civil judicial proceedings, excessive interest rates and unjust termination charges on lease contracts.
“The right for service members to terminate leases without penalty when military orders send them elsewhere is a critical protection for people who already sacrifice so much,” assistant attorney general Kristen Clarke of the Justice Department’s Civil Rights Division said in the statement.
FPI Management Inc. of Folsom, Calif., has agreed to pay $74,087 after the Justice Department said the company imposed unlawful charges on nine service members who terminated their apartment leases after receiving military orders. (Facebook)
Federal investigators began looking into FPI’s practices after Coast Guard Legal Assistance reported the company for requiring two Coast Guardsmen to repay discounts they received when signing leases.
Coast Guard Petty Officer 1st Class Aaron Gomez and his wife were asked to repay $8,590 in lease incentives after they terminated their lease at an apartment building in Oakland, near Coast Guard Island in Alameda, the Justice Department said.
FPI also demanded Petty Officer 1st Class William Fuchs repay a $7,838 discount when he needed to break his lease in the same building to relocate with orders to Charleston, S.C.
Under the agreement, FPI will pay $51,587 directly to the nine service members and an additional $22,500 in government penalties.
The company also will be required to provide compliance training to its employees, the department said Tuesday.
The Justice Department says it has returned $481 million to more than 146,000 service members under the SCRA since 2011.
