Burlington Co. Apartment Complex Charged Military Members Illegal Fees: Feds

MOUNT LAUREL, NJ — A property-management company illegally imposed early-termination fees against nine servicemembers who needed to move out of a Mount Laurel apartment complex for a change in military assignment, authorities said.

JAG Management Company LLC charged penalties as high as $2,750 to each military member who terminated their lease at the Jefferson Mount Laurel Apartments, according to the U.S. Department of Justice. The Virginia-based company agreed to pay a $61,581 settlement on Sept. 29 — the same day the DOJ filed a complaint with the allegations.

The Servicemembers Civil Relief Act (SCRA), a federal law, prohibits early-termination fees against servicemembers who must move after receiving qualifying military orders, among other protections.

JAG's violations occurred from April 2019 to April 2022, according to the case's consent order.

One of the victims — Coast Guard Lt. Daniel Pereira — entered a one-year lease with Jefferson Apartments in January 2021 while on command in Philadelphia, according to court records. In May of that year, Pereira received transfer orders for stationing in New London, Connecticut — effective that August.

Pereira provided a written notice of termination with a copy of his orders to JAG, the DOJ said. He paid his remaining rent thereafter.

When he moved out, JAG never asserted that Pereira would owe any additional fees. But later that year, a debt-collection agency informed the servicemember that he owed an outstanding debt of $2,120.48 on behalf of the apartment complex, authorities said.

The collector advised Pereira that failure to pay would result in the debt getting referred to credit-reporting agencies. Citing the SCRA, Pereira refused to pay the early-termination charge.

Pereira submitted a federal complaint in January 2022. His credit score was downgraded the following month but restored in March 2022 after he filed another complaint to the Consumer Financial Protection Bureau, federal officials said.

That May, the DOJ notified JAG that it was opening an investigation into the company's residential-leasing practices. JAG "provided only limited documentation and information" in response to the DOJ's requests, the federal agency said. But those records showed the company demanded repayment of rent concessions to nine servicemembers, including Pereira, according to investigators.

One victim — an Air Force staff sergeant — noticed an additional $2,673 fee on his bill when he prepared to move out in early 2021, according to the DOJ. He disputed the charge, citing the SCRA, but JAG refused to rescind the penalty, authorities said. Months later, he paid the fee, fearing a negative credit report.

In November 2021, an Air National Guardsman paid $2,364.53 to an agency collecting debt on JAG's behalf because of similar fears, the DOJ said.

The federal complaint doesn't share the names of any impacted servicemembers besides Pereira.

Under the consent order — subject to court approval — JAG must pay $41,581 in damages to the nine servicemembers. The company will also owe $20,000 in civil penalties to the federal government and must implement policies to ensure compliance with the SCRA, such as employee training.

Headquartered in Virginia, JAG runs more than 20 large apartment complexes in several states — including New Jersey, Maryland, Virginia and Florida, along with the District of Columbia.