Nassau Business And Owner Sued For Scamming Homeowners Out Of Millions

An East Meadow-based business is being sued by the state, alleging that the business owner scammed thousands of homeowners by charging them excessive fees.

On Thursday, Attorney General Eric T. Schneiderman announced a lawsuit against STAR Exemption Advisor, YCA Corp. and its business owner, Arie Gal, of East Meadow, for allegedly scamming thousands of new homeowners out of at least $1.5 million by charging them excessive fees to enroll them in the Basic STAR Exemption Program, which is otherwise free. The lawsuit, filed in Nassau County Supreme Court, seeks to provide full restitution to all those affected and a complete accounting to identify all consumers who are entitled to such refunds.

The lawsuit also seeks additional costs and damages and to permanently stop Gal from marketing any Basic Star rebate or property tax reduction services within New York. The Attorney General’s office also secured a temporary restraining order stopping Gal and his company from doing business in New York State, to pay full restitution and damages to all injured consumers and to render a full accounting of all victims to the office. The temporary restraining order also froze all of Gal's assets.

“Home ownership is challenging enough," Schneiderman said in a release. "Preying on and deceiving New Yorkers by manipulating the STAR program – one of the few forms of financial relief available to homeowners – is shameful and illegal."

The New York State School Tax Relief (STAR) Program provides a partial exemption from school property taxes for primary residences that are owner-occupied with a total household income of $500,000 or less. To receive the exemption, new homeowners must file an application with their local assessor’s office by Jan. 2 in order for the exemption to be applied to the upcoming and subsequent years’ tax bills.

Schneiderman’s Office started an investigation of Gal and his business after receiving numerous complaints from homeowners who alleged that his company had substantially overcharged them for filing an otherwise free application that the homeowners completed themselves. Moreover, homeowners were unaware that they were doing business with a private company, as they believed they were sending their Nassau County application forms to the county, not an intermediary.

The Attorney General said that Gal used an official-sounding name like “Star Exemption Advisor” to scam thousands of homeowners out of tax savings that rightfully belonged to them. His company allegedly sent misleading mailers that looked like official government agency documents that tricked homeowners into signing up with them to apply for the Basic STAR exemption for a fee. It is charged they used official-looking envelopes to make homeowners think that the mailers were coming from a government agency. Moreover, the company charged homeowners a fee that was 100 percent of the total tax savings for the first year even though applying for Basic STAR exemption costs nothing and can be accomplished without professional help.

Once homeowners were approved for the exemption, the company sent them invoices. If payment was not remitted immediately or homeowners disputed the charges, Gal allegedly sued them in Small Claims Court. He even allegedly sued homeowners for applications the homeowners had personally filed with the Department of Assessment. Upon receiving a Small Claims Court notice from Gal, most homeowners settled to avoid litigation. Homeowners who went to their scheduled court date were shocked to see so many other homeowners in the same predicament.

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