The proposed order would require Progress Residential to show total monthly rent more prominently, including mandatory fees. A federal judge must approve and sign it before it takes effect.
The US Federal Trade Commission (FTC) and Arizona, Colorado, Indiana and Utah have proposed a $49.75 million settlement with Progress Residential and its owner, Pretium Partners, over allegations that the companies misled renters about prices and mishandled deposits.
The complaint alleges that hidden fees dating back to at least 2021 cost consumers tens of millions of dollars, often appearing only after they signed a lease or moved in. It says most of the alleged conduct occurred under previous management and that new management has moved to remedy the issues.
The FTC and states filed the complaint and proposed order in the US District Court for the Northern District of Georgia. The allegations are not court findings, and the proposed injunction would have the force of law only after a district judge approves and signs it. The FTC says it files a complaint when it has reason to believe the named defendants are violating or about to violate the law and a proceeding appears to be in the public interest.
Pretium, a private equity firm, founded and wholly owns Progress. The FTC says Progress manages more than 90,000 homes across 17 states, which Pretium owns through its investment funds.
Under the proposal, $48.5 million would go to the FTC for redress for harmed consumers and $1.25 million would go to Arizona.
The complaint alleges that advertised rents omitted mandatory monthly charges, including smart-home and utility-management fees. If approved, the order would bar deception about total rental prices and require Progress to display the total monthly price, including all mandatory recurring fees, more prominently than other pricing information.
Regulators also allege that Progress promised to deduct from security deposits only for renter-caused damage beyond normal wear and tear, but withheld deposits for ordinary wear, preexisting conditions and repairs or renovations that were the companies’ responsibility, and that many renters did not receive promised itemized statements. A security deposit is money a renter pays that can be held against certain charges when the tenancy ends.
The proposed purchase, worth about $2.9 billion, would add 8 European liquid-storage terminals to the Indian port operator’s business, subject to approvals and consultation.
The proposed order would prohibit deductions for normal wear and tear, preexisting conditions and certain renovation or capital-improvement costs unrelated to renter-caused damage. Progress would have to establish a refund process with uniform withholding standards, staff training and records of home conditions. It would also have to provide an itemized explanation of deductions or charges no later than 30 days after move-out or within the time required by state law.
The complaint alleges that the companies failed to inspect homes before residents moved in, misrepresented whether homes had been inspected and were ready for move-in, restricted negative comments and provided inadequate customer service. The proposed order would prohibit false inspection claims, require an end to standardized clauses that bar negative comments, and prohibit certain unfair customer-service practices.
A representative of the companies told HousingWire that the agreement contains no admission of wrongdoing. The companies dispute the FTC’s allegations and say Progress’s practices were transparent, fair and consistent with industry practice.
The proposed order awaits the district judge’s approval and signature before the payment and conduct requirements can take effect.
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