Submitted by ANONYMOUS, Feb 15, 2007 11:59

Here's a real life, bitterly painful example of how the 40x the rent rule squeezes a secret "rent increase" of out me each year, thanks to a provision in the General Obligations Law, which requires that landlords pay tenants interest on their security deposits....the same provision allows a landlord to keep a "bookkeeping fee" amounting to 1% of the security deposit each year.

By using the phony ratios in the 40X rule, as I explained in my comment "One more way landlords can bleed us", my landlord told me that I don't quite qualify but if I hand over FIVE TIMES THE RENT AS A SECURITY DEPOSIT, they would make an exception.....so I had to to get the apartment......fast forward to January 2007. One my security deposit of over $11,000, I earned a measly $151 in interest; paid taxes on all of it; and lost $108 of it to my landlord!!! What did they do for that $108 per year? They simply maintained the record of my escrow account with the Bank; nothing more!! Now lets say that they do that for one third of the tenants in the building....they would then earn about $5000 per year JUST TO MAINTAIN THE BANK ACCOUNT RECORDS AND PROCESS AND OCCASIONAL NEW DEPOSIT AND WITHDRAWAL BY COMPUTER. After 10 years this

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