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Golden State Today

Wednesday, January 22, 2025

California Attorney General Rob Bonta Announces Settlement with Arnel Management Company over Illegal Withholding of Security Deposits

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Attorney General Rob Bonta | Official website

Attorney General Rob Bonta | Official website

California Attorney General Rob Bonta has announced a settlement with Arnel Management Company over allegations of illegally withholding security deposits from tenants in Southern California. In response to the settlement, Attorney General Bonta stated, "California tenants have rights, and my office is committed to protecting those rights. We are holding Arnel accountable because, in some cases, the company failed to return to tenants the entire security deposit that they were legally entitled to and worked hard to save up for."

The settlement requires Arnel to pay over $1 million and adhere to more stringent injunctive terms to prevent future misconduct. This settlement comes after a recent investigation revealed that Arnel had been deducting pre-set cleaning fees from tenants' security deposits, regardless of the unit's condition. Tenants were only able to avoid these fees by having their unit professionally cleaned upon moving out.

As part of the settlement, Arnel will pay $500,000 in additional civil penalties and $650,000 to tenant rights-related legal aid organizations in Orange and Los Angeles counties. The company will also be prohibited from imposing pre-set deductions, requiring tenants to repair preexisting damages, and must provide clear notice to tenants of their rights. Additionally, Arnel will be required to respond to tenant complaints in writing and support security deposit deductions with pictures.

Attorney General Bonta emphasized that under state law, cleaning fees can only be withheld if the unit is not left in the same level of cleanliness as when the tenant moved in, and landlords may not deduct for ordinary wear and tear. Tenants are encouraged to request a pre-move-out inspection to identify any issues that need to be addressed to avoid security deposit deductions.

Earlier this year, Attorney General Bonta issued consumer alerts to inform California tenants of their rights and to remind property managers and landlords of their obligations. The settlement with Arnel Management Company aims to protect the rights of tenants and ensure fair practices in the handling of security deposits.

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