The owners of several dilapidated apartment buildings in Aurora and Denver have faced a new threat in recent months: an investigation by the Colorado Attorney General’s Office on suspicion of violating the state’s safe-housing and consumer-protection laws.
The state office sent subpoenas to CBZ Management, one of its primary representatives and several of its subordinate companies in September, according to records obtained by The Denver Post. The subpoenas seek answers and records related to a swath of CBZ’s practices, including how it advertises its properties and whether tenants get the apartments they have toured; how the companies track and respond to maintenance requests and health code violations; how they handle security deposits; and how they screen tenants, among other questions.
CBZ Management’s buildings in Aurora have been the subject of extensive tenant and municipal complaints and have recently drawn international attention over allegations the properties were overtaken by gangs.
The documents state that the attorney general’s office “has cause to believe that you may have information relating to potential misrepresentations, omissions, or unfair, deceptive, or unconscionable acts or practices regarding the leasing of rental housing units in Colorado, as well as potential violations of the Warranty of Habitability statute … that risk harm to a consumer, public health, or public safety.”
The companies were given a response deadline of Oct. 25.
The warranty of habitability is the formal name for the state law regulating housing conditions. State law was changed in May to allow the attorney general to investigate a “pattern or practice” of violating the warranty of habitability or a violation that “raises an issue of public importance” — meaning this portion of the investigation is likely the first of its kind in Colorado.
The subpoenas indicate the probe is not focused solely on CBZ’s troubled Aurora properties. The demands were also sent to companies that own its properties in Denver, Edgewater and Colorado Springs.
The attorney general’s office, which provided the subpoenas to The Post in response to a public records request, declined to comment. Zev Baumgarten, the Colorado-based representative for CBZ and the subject of one subpoena, did not return an interview request about CBZ’s practices and ongoing investigations into the company. Nor did the company’s owner, Shmaryahu Baumgarten, or its attorney, Walter Slatkin.
Through its records request, The Post obtained a Sept. 23 email from Slatkin to a deputy attorney general, in which Slatkin noted the recent “media reporting on our client’s apartment buildings” and the gang allegations CBZ has made.
“Things are not going well,” Slatkin wrote, expressing frustrations with Aurora officials’ response to the gang reports.
It’s unclear what triggered the inquiry or for how long the AG’s office has been investigating the companies. But two former CBZ tenants, who lived at 1399 Vine St. in Denver between 2021 and 2023, told The Post that they filed complaints and spoke with officials from the attorney general’s office over the last year.
Peter Svaldi and Victor Kurtz said their complaints accused CBZ of insurance fraud related to how the company handles security deposits. Both men moved out of the Vine Street complex in 2023, before their leases expired, after they went weeks without hot water. Svaldi also briefly withheld rent over habitability issues.
Under certain conditions, Colorado law allows tenants to break a lease because of housing conditions.
In lieu of a security deposit, Svaldi and Kurtz said they were required to obtain insurance from a third-party company when they moved in. When they each moved out in early summer 2023, they said, CBZ filed claims with the insurance company for lost rent, and the insurance company then pursued the men for the money. They were simultaneously pursued by debt collectors sent by CBZ, also seeking lost rent, both men alleged.
Kurtz said another tenant who filed a complaint listed him as a witness.
In May, Svaldi filed a lawsuit against the CBZ-controlled company that owns 1399 Vine St. over the property’s condition, as well as against credit reporting agencies in a bid to get the debt removed from his credit report. The case has largely been resolved, except for the claims related to CBZ. The company has not responded to his suit.
Svaldi said he will likely need to refile his lawsuit but can’t afford to. He was frustrated by the response to CBZ’s practices and said his faith in the justice system had been shaken. Svaldi briefly protested outside of the AG’s office in late September.
He now wonders if he should have just paid the company and moved on.
“I’m exhausted,” Svaldi said. “Legally, I don’t have the money to keep paying my attorney. He’s been great in terms of just letting bills float until we see what happens, but the bigger point is I never should have had to do this in the first place.”
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