Tenants Leader Accused of Misleading Clients : Northridge: Stanley Simon helped people evade paying rent and filed bogus bankruptcies, officials say.

A Van Nuys man was charged Tuesday with running a business that illegally helps apartment tenants evade paying rent and assisting homeowners who haven’t paid their mortgages to delay foreclosures by filing bogus bankruptcies, authorities said.

Stanley Simon, 61, was named in a 44-count criminal complaint filed by the city attorney’s office, accusing him of making false and misleading statements, illegally practicing law, grand theft and other charges.

Simon and his Northridge-based Tenants Rights Group helped tenants occupy their apartments without paying rent for five to seven months by clogging the courts with frivolous legal motions, prosecutors and Los Angeles police detectives said.

“Everybody was a victim of this scam,” City Atty. James K. Hahn said. “Landlords lost revenue and risked their own foreclosure when tenants stopped paying rent. Tenants got to live a few months rent-free but will now have to live for years with bad credit, and homeowners destroyed their credit ratings with phony bankruptcies that did not even save their homes from foreclosures.”

The group obtained the names of tenants and homeowners from Los Angeles County courts that list evictions and foreclosures, then sent them letters saying they could legally postpone the proceedings. Also, authorities said, the group distributed flyers at San Fernando Valley apartment complexes promising to help tenants, even if they hadn’t been evicted.

Simon declined to comment in depth on the charges because he said he was with clients at his storefront office in a Reseda Boulevard mini-mall.

He also said he didn’t know the complaint had been filed in Los Angeles Municipal Court. “I’m in shock. I don’t know anything about it.”

Simon indicated, however, that he would fight the charges. “Hell no, I’m not guilty,” he said, “but it’s hard for me to talk now.”

He is scheduled to be arraigned Jan. 7.

Since his arrest Sept. 22, Simon has maintained that he has done nothing wrong. In fact, he was back in business the next day after posting $50,000 bail, authorities said.

No other employees of the Tenants Rights Group are suspects in an ongoing investigation into the group’s dealings, said Detective John Stieglitz, who arrested Simon and seized his files and computers.

Many of the group’s clients, whose names were contained in confiscated records, told police that Simon and other personnel gave them the impression they were qualified lawyers dispensing legal advice when, in fact, none were, said Deputy City Atty. Ellen Pais, who is prosecuting Simon.

The group charged its clients $150 or more a month to file legal motions designed to delay eviction or foreclosure proceedings, authorities said. Then, the group filed bankruptcies on behalf of many clients--often without telling them--to postpone evictions even longer, according to the criminal complaint.

Because the group only delayed the evictions--and never contested them--the majority of its clients wound up with court judgments against them for back rent and court costs, authorities said, as well as black marks on their credit ratings.

“Regardless of the promises he made, stalling was all Simon could hope to do,” Hahn said, “while his victims were unaware the money they were paying him was just buying a little time.”

One woman said Simon charged her $3,000 to help save her North Hollywood home from foreclosure in February. Simon told the woman to stop most of her mortgage payments, but the woman later discovered that bankruptcy documents prepared by Tenants Rights Group were full of major errors and that a bankruptcy would not have saved her home anyway, Hahn said.

In another case, a Van Nuys woman told police she paid $150 to the Tenants Rights Group to help her avoid eviction after she had been withholding rent due to what she considered to be unsatisfactory living conditions. She later found that the group put her in bankruptcy without telling her by forging her signature and adding false information, Hahn said. She was evicted soon afterward, he added.

Hahn noted that there are many legitimate groups that help tenants contest unfair evictions and respond to substandard living conditions. “They do not have to resort to schemes like the Tenants Rights Group, which rips them off along with their landlords,” he said.

Simon is charged with nine counts each of making false and misleading statements and illegally practicing law; four counts each of failing to provide an adequate contract and receiving money as a foreclosure consultant prior to performing the service; one count of grand theft, and 17 counts of violating Unemployment Insurance Code regulations.

The grand-theft charge is punishable by up to one year in jail and a $1,000 fine. Some of the other charges, particularly those relating to Simon’s alleged non-payment of state unemployment insurance payments for his employees, carry maximum penalties of a year in jail and as much as $20,000 in fines.