Six years ago, a scandal rocked the New York State real estate management industry for the second time in a decade. Thirty management company owners, agents and contractors were indicted for taking kickbacks for contract work at many New York City co-ops and condo buildings.
During that sweep of corrupt companies, two of the city’s largest management businesses—Marvin Gold Management and Elm Management Associates—were accused of taking millions of dollars in payoffs from contractors for work at luxury cooperatives, as well as low- and middle-income buildings throughout the city. One manager in the center of the controversy was accused of taking a total of nearly $4 million in kickbacks from contractors for work in some 74 buildings.
These scandals promptly re-ignited the often-discussed and very heated debate over whether property managers should be licensed. Currently, New York property managers are not required to be licensed—although many voluntarily take continuing education courses to stay current in the industry—and this fact still generates a good deal of controversy among residential industry players. Today, however, the interest in passing legislation to license property managers is either firing up or sizzling out, depending on whom you ask.
On one side of the debate are the licensing proponents, advocating that managers should earn educational credentials and answer to a governing authority of some sort to ensure ethics and standards in the industry. Proponents firmly believe that such licensing may reduce the chances of a third round of scandal.