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City sues Deutsche Bank for slumlord practices

May 4, 2011 12:00:00 AM PDT
It's a tough economy out there. However, the Los Angeles city attorney says that's no excuse for banks to exploit tenants and let neighborhoods deteriorate.

Some homes in South Los Angeles are owned by one of the largest banks in the world, what the city attorney Carmen Trutanich calls one of the largest slumlords in Los Angeles, Deutsche Bank, headquartered in Germany.

"Our complaint alleges that Deutsch Bank unlawfully evicted tenants in an effort to vacate, in order to sell buildings and take advantage of rental hikes," said Trutanich.

The city attorney was joined by L.A. City Council members and other officials in announcing a lawsuit against Deutsche Bank and its subsidiaries. The lawsuit could result in the bank being liable for hundreds of millions of dollars for failing to maintain thousands of properties and illegally evicting hundreds of tenants.

"This bank, which is worth $48 billion, is responsible for foreclosing on people's homes illegally and harming many, many working families in the process," said L.A. City Councilwoman Janice Hahn.

The bank is also being sued by the U.S. government, accused of defrauding the government. The city attorney's lawsuit is a completely separate action.

The bank says the city is suing the wrong party.

In a statement, the bank says: "loan service officers, and not Deutsche Bank as trustee, are contractually responsible. For over a year we have offered to help the Los Angeles City Attorney's office, but they have refused our help."