The suit filed by Minnesota’s Attorney General Keith Ellison claims Chadwick Banken violated state and federal laws, including a state law against religious discrimination.
Minnesota’s Attorney General Keith Ellison filed a lawsuit against a real estate broker that was allegedly targeting a popular Muslim community with contract-for-deed real estate deals.
In the suit filed on May 14 in Hennepin County district court, Ellison’s office claims Chadwick Banken and his six limited liability corporations violated state and federal laws, including a state law against religious discrimination. He is accused of using the transaction type to sell homes at higher prices than valued and issuing worse terms to Muslim buyers. Authorities described the practice as “predatory and deceptive” and Ellison said Banken isn’t the only one issuing contract-for-deed deals.
However, the lawsuit is about sending a message to others. “He’s not the only one, but he’s one of the worst that I’ve seen,” Ellison said. “When people can’t pay back, they’re out of their house, and they’re out of their money. I can’t think of anything more financially devastating to a family than that.”
The suit claimed Banken would use inflated home prices, higher-than-normal down payments, and six-figure balloon payments due at the end of short contracts as a way to push buyers into default.
In the end, Banken would be able to gain ownership of the property.
Banken has allegedly sold hundreds of homes in contracts-for-deed deals to victims like Igal over the past six years. The suit lists one of Banken’s LLCs, Slow Flip LLC, as one of the company’s where buyers would submit high down payments and agree to large monthly installments that would lead to default.
In an email from Banken’s business to a real estate agent, the ideal buyers are described as buyers with “low credit scores” or a “recent bankruptcy/foreclosure.” He also is accused of insisting buyers enter contracts using business names, to create a false impression in court that it was commercial tenants being evicted. Contracts under Banken failed to list the true cost of the homes or the balloon payments — a violation of the Truth In Lending Act requirements.
The attorney general is encouraging buyers to reach out to his office if they feel they’re in a contract-for-deed deal, as there may be opportunities for restitution in the future.
Source: Black Enterprise
