.Alameda’s ‘Landlord-in-Chief’ Accused of Wrongdoing

Don Lindsey, who is one of Alameda’s most powerful landlords and is a leader among property owners strongly opposed to rent control on the Island, is under investigation by the California Bureau of Real Estate for alleged financial improprieties. A state investigator is accusing Lindsey of failing to provide proper accounting for various tenants’ fees, according to a complaint filed last month with the Bureau of Real Estate. If proven, the charges could result in Lindsey losing his real estate license, the complaint states.

The complaint, filed December 16, includes an allegation by a state investigator that Gallagher & Lindsey Property Management, the firm co-founded by Lindsey in 1967, collected $2,124 from three prospective tenants, but failed to deposit the proceeds into a trust fund or specific bank accounts as required by law.

And an audit of Lindsey Properties, Inc. in December 2014 found that bank accounts reported to contain property management fees charged to renters was $72,465 less than what it should be under the law. In addition, withdrawals were made from the accounts without proper consent given by the renters. The complaint also alleges Lindsey’s companies failed to place financial proceeds into a dedicated trust fund in the name of each tenant and that withdrawals were made from the account by two unlicensed individuals. In addition, Lindsey failed to provide copies of cancelled checks from the bank account to the investigator, according to the complaint, which was first reported by Indymedia.

In an interview, Lindsey said the allegations have been remedied and he denied any wrongdoing. “I have a thirty-year history of no complaints and a spotless history,” he said. “I know this makes good headlines, but it’s not true.”

[jump] Lindsey alleged that the auditor who noted the $72,465 deficiency in one bank account was not familiar with Yardi, the accounting system used by Lindsey’s company. Lindsey also said he had a dispute with the auditor over the definition of “advanced fees.” Lindsey asserts that fees charged to tenants for moving them into housing units are not advanced fees, but rather, services earned.

Lindsey said the two unlicensed individuals alleged to have made withdrawals from the account were family members who were licensed signatories at the time the account was created, but no longer write checks. In addition, Lindsey said cancelled checks were not provided to the auditor because the bank no longer provides them in hard copy form.

However, the Alameda Renters Coalition, which has been pushing for rent control in the city, was quick to seize on the allegations against Lindsey, who has led the early opposition to rent control by landlord groups on the Island by way of his public comments and an opinion piece urging for utilizing the existing Rent Review Advisory Committee instead of far-reaching rent restrictions. Lindsey prominence, in fact, has led some members of the renters’ coalition to refer to him as the “landlord-in-chief.”

Catherine Pauling, a spokesperson for the Alameda Renters Coalition said the allegations against Lindsey are significant. “He holds so much sway in Alameda and is so powerful,” said Pauling.

The renters’ coalition also has called for greater protections for tenants’ fees, such as security deposits. “These allegations really point out why this isn’t a small issue,” said Pauling. “Too often we find landlords are treating these accounts like their own personal money.”


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