Office of the Attorney General Announces Petra Management Group Will Pay $700k to Resolve Lawsuit Over Housing Voucher Abuse Scheme

The Office of the Attorney General (OAG) today announced that the owners and manager of three District apartment complexes-Petra Management Group, LLC, Rashid Salem, 4825-4829 North Capital St L.L.C., 5616 13th St NW L.L.C., and 743 Fairmont St NW LLC, (collectively, "Petra")-will pay $700,000 and reform their practices to resolve the Office of the Attorney General's lawsuit alleging that Petra had illegally discriminated against lower income DC residents in order to boost profits, effectively limiting affordable housing options in DC.

In January 2025, OAG sued Petra for evading the District's rent control requirements that make housing affordable for low-income residents who do not receive housing vouchers or other subsidies. The lawsuit alleged that Petra was gaming DC's housing voucher system so that they could rent to tenants who did receive vouchers, and charge them higher, government-subsidized rates. Under the terms of today's settlement agreement, Petra will end its discriminatory practices, publicly advertise available rent-controlled apartments at the lawful rent-controlled rates rather than the higher subsidized rates, provide fair housing training to staff, and submit to three years of compliance monitoring by OAG, in addition to paying significant penalties. The settlement is still subject to final court approval.

"Too many DC residents are already struggling to find an affordable place to live, and the Office of the Attorney General will not tolerate source of income-based housing discrimination that further limits affordable housing options," said Beth Mellen, Assistant Deputy Attorney General and Senior Counsel for Housing Protection and Affordability. "Petra illegally exploited the District's housing voucher program for profit-taking advantage of DC taxpayers as well as tenants without vouchers in need of affordable housing, including seniors and people with disabilities on fixed incomes. Today's settlement both holds Petra accountable and ensures that more Washingtonians can access affordable housing."

"Today's settlement is a win for tenants across Ward 4 and DC who have been denied affordable housing as a result of Petra's abuses," said Councilmember Janeese Lewis George. "OAG's lawsuit details a clear pattern by Petra of exploiting District law to maximize profits and discriminating against lower-income tenants. While there's still more work to do to address the harmful conduct of Petra Properties in Ward 4, I'm grateful to have Attorney General Schwalb as a partner in fighting for DC residents' rights to safe, affordable, dignified housing."

"Petra was putting profits above people, making it impossible for working families to find safe, affordable housing," said Councilmember Robert White. "Deliberately impeding our neighbors' right to live affordably while profiting off them at their own expense is simply unjust. That's a recipe for a broken housing system and we won't tolerate it."

Under DC law, all units built before 1976 are subject to rent control unless landlords qualify for certain exemptions. An OAG investigation uncovered evidence that Petra illegally exploited a law exempting apartments from rent control requirements when they are leased to tenants with government-funded housing vouchers or other subsidies. The lawsuit alleges that Petra illegally leased rent-controlled apartments solely to voucher holders, which enabled it to charge significantly higher rental rates subsidized by the federal and District governments. As a result, Petra deliberately excluded low- and moderate-income tenants without subsidies who would have been eligible to rent apartments at lower rent-controlled rates. Petra perpetuated this profit-maximization scheme by advertising its apartments exclusively at the increased subsidized rates without disclosing the rent-controlled rates it was legally required to charge.

OAG filed suit in January 2025, alleging that Petra's scheme unlawfully discriminated against prospective tenants based on their source of income, in violation of the District's Human Rights Act (HRA) and Consumer Protection Procedures Act (CPPA).

To resolve this litigation, Petra Management Group and its co-defendants will:

• Pay $700,000 to the District.
  
• Publicly advertise all available rent-controlled apartments at rent-controlled rates. If any rent-controlled unit Petra owns, operates, or manages becomes vacant, Petra must post an advertisement for that unit on at least one publicly available forum, such as through a Multiple Listing Service (MLS) or apartment rental websites like Zillow.com, Apartments.com, or Redfin.com. Petra must list the unit for rent at the lawful rent-controlled rate.
  
• Reform leasing and advertising practices at all of its DC properties. Petra will end its discriminatory leasing and advertising practices at all of the properties it owns, operates, and manages in the District. This includes the three properties originally named in the lawsuit and extends to Petra's entire DC rental portfolio.
  
• Provide fair housing training to staff. Petra must provide fair housing training to all its staff who provide property management or leasing services for its properties.
  
• Submit to three years of compliance monitoring by OAG: Each year for three years following this settlement, Petra must provide documents to OAG on all of its rent-controlled properties in DC, which will allow OAG to monitor the company's compliance with the District's rent control, human rights, and consumer protection laws and with the terms of the settlement agreement. Petra must provide additional detailed records to OAG upon request to ensure continued compliance.

A copy of the settlement is available here.

This matter was handled by Assistant Attorneys General Nadeen J. Saqer and Camila Ramirez, Civil Rights and Elder Justice Chief Alicia M. Lendon, and Director of the Office of Consumer Protection Kevin Vermillion.

How To Report Discrimination

District residents who believe that they have experienced or witnessed housing discrimination, or any other form of discrimination, may report it to OAG's Civil Rights & Elder Justice Section by:

• Calling (202) 727-3400
• E-mailing [email protected]
• Mailing OAG, ATTN: Civil Rights & Elder Justice Section at 400 6th Street, NW, Washington, DC 20001

OAG's civil rights work complements the work of the District's Office of Human Rights (OHR), which is the primary District agency that investigates individual discrimination complaints. You can file a complaint with OHR at ohr.dc.gov/service/file-discrimination-complaint or call 202-727-4559.

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