A real estate agent in La Cañada Flintridge is facing criminal charges for allegedly boosting the price of a rental home by 38% following the disastrous wildfires in Los Angeles, according to California Attorney General Rob Bonta on Wednesday.
“May this announcement serve as a stern warning to those who would seek to further victimize those who have lost everything,” Bonta wrote in a news release. “DOJ is aggressively and relentlessly pursuing those who are trying to make a quick buck off someone else’s pain.”
A couple who lost their house in the Eaton fire tried to rent a home in La Cañada Flintridge from real estate agent Mike Kobeissi, according to a Justice Department inquiry. However, after submitting their application, the couple was informed that the price had increased by 38%, according to the probe. The couple opted not to rent the residence due to the price hike.
California law bans boosting rental property rates and other critical goods and services by more than 10% in the aftermath of a natural disaster. The rules will remain in effect until March 8, unless extended by Governor Gavin Newsom.
Kobeissi stated in an interview that he did not engage in price gouging and that the claims are unjustified. He boosted the monthly payment from $8,700 to $12,000 after confirming the home’s location within the prestigious La Cañada Flintridge school district. The higher fee, according to Kobeissi, was equivalent to other rents in the area.
“It had nothing to do with the fires or anything,” Kobeissi explained.
Kobeissi stated that he had proposals from prospective tenants for $14,000 and $16,000, but he and the property owner opted to rent it for less than $10,000 to fire victims. According to Kobeissi, the owner also offers a free month of rent and furniture.
“Right now, the home is rented way below the market,” he told me.
Kobeissi boasts over 25 years of expertise as a leading Realtor in La Cañada Flintridge, as stated on his website. According to the website, his firm has sold properties in the enclave for up to $11 million.
The claims against him are damaging to his character and undermine his attempts to help the community in the aftermath of the tragedies, he claimed. He revealed yesterday that he hosted a dozen firefighters for lunch at his home.
“I’ve been helping people one after another,” Kobeissi remarked.
The accusations against Kobeissi filed in Los Angeles County Superior Court on Tuesday are the first for price gouging in connection with the historic fires that occurred on January 7. Violations are prosecuted criminally, with penalties ranging from one year in county jail to $10,000 in fines. Civil penalties include fines of up to $2,500 for each infraction.
More than 11,000 houses were burned in the Eaton and Palisades fires, resulting in an overnight influx of families into L.A.’s already tight rental market. Widespread claims of price gouging followed, with Times writers uncovering examples of postings that had increased by 60% or more, while activist groups combed Zillow and other sites for hundreds of potential instances and filed complaints with authorities.
Bonta has formed teams of his attorneys across the state to review the submissions and has issued multiple remarks condemning price gouging. Nathan Hochman, the district attorney for Los Angeles County, and other local elected leaders have echoed the request.
Bonta said he has written over 500 warning letters to landlords and hotel owners suspected of price gouging, and his office is conducting additional criminal investigations.
“As I have said repeatedly, the price gouging must stop,” Bonta told the crowd. “Today, we are making good on our promise to hold price gougers accountable, with more to come.”
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