The Federal Trade Commission on Monday announced the Central District of California courts ruled in their favor in a case against Steven and Kevin Shayan, the brother duo that operated a number of sites that fraudulently claimed to exclusively list a number of Section 8 properties.

The Shayans must pay a $6 million fine that will be used to reimburse victims, and they’ve been permanently banned from offering any rental listing services.

On their site, WeTakeSection8.com, the duo claimed they had access to exclusive listings that couldn’t be found on free platforms and charged more than 500,000 consumers, which included low-income, elderly or disabled individuals and families, for access to those listings.

The brothers offered two subscriptions — $49 for two-month access or $14.99 for one-week access. However, the listings the Shayans published were either outdated or not Section 8 voucher approved.

The brothers also defrauded consumers on their other platforms, FeaturedRentals.com, ApartmentHunterz.com, Real Estate Data Solutions, Inc.; Rental Home Listings Inc.; and UAB Apartment Hunters LT.

“Today’s housing market is historically tight, and affordable rentals are harder to find than ever,” FTC Director of the Bureau of Consumer Protection Andrew Smith said in a prepared statement after the Commission filed its case in September. “Section 8 voucher recipients have it even harder: they have fewer rentals from which to choose and their vouchers expire if not used within a specified period of time.”

The Federal Trade Commission said Section 8 scams are more common than consumers realize.

In an explainer, FTC Consumer Education Specialist Lisa Lake said the majority of Section 8 voucher waiting lists on the internet are fraudulent and scammers go through great lengths to convince consumers of their validity by including Equal Housing Opportunity logos.

“They ask for fees and your personal information, like your Social Security number, but they won’t do anything for you,” Lake warned. “The scammers will keep your money and disappear. They also may give your personal information to identity thieves.”

“In another twist, some fake sites list Section 8 properties that supposedly are available,” she added. “They promise you can rent one, if you pay the first month’s rent via wire transfer or a prepaid card. The properties might exist, but the ads are fakes placed by scammers. If you pay, you just lose your money.”

Lake said consumers should immediately report any sites offering placement on voucher waitlists or access to exclusive listings since all Section 8 activities are handled through local housing authorities.

The Shayans will be under close supervision for the next 20 years and must submit compliance reports with their current contact information and details about any other businesses or business deals they establish or partake in.

“We make every effort to hold defendants accountable and to enforce FTC orders as well as to return money to defrauded consumers when possible,” an agency spokesperson told The Orange County Register. “We are pleased that the court has agreed to shut this scheme down permanently and to hold the Shayan brothers accountable for their unlawful behavior.”

“Unfortunately, with such schemes it is rare that sufficient funds exist to return money to injured consumers,” they added.

Read the full court order below.

Email Marian McPherson

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