Hedge Fund Reaches Potential $2.7 Million Settlement Over Rent-to-Own Home Financing

Hedge Fund Reaches Potential $2.7 Million Settlement Over Rent-to-Own Home Financing

New York regulators have reached a settlement worth up to $2.7 million with a hedge fund that provided financing and assistance to a large rent-to-own home firm accused of engaging in predatory business practices.

The settlement announced Tuesday requires the hedge fund, Atalaya Capital Management, to provide at least $20,000 in restitution to the more than 100 state residents who thought they were entering into deals to ultimately buy homes from Vision Property Management.

Atalaya, a $5 billion hedge fund based in New York, also agreed to pay a $250,000 civil penalty under the settlement, reached with the state attorney general and the Department of Financial Services. The deal came less than a month after the agencies filed a lawsuit against Vision, saying the company had operated an “illegal, unlicensed mortgage lending” business by using deceptive rent-to-own agreements to sell often-rundown homes.

Linda A. Lacewell, New York’s superintendent of financial services, said the settlement “provides a measure of restitution to New York consumers who were left holding the bag with further debt, uninhabitable properties and broken dreams.”

An executive from Vision did not respond to a message seeking comment.

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