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FBI agent and D.C.-area realtor allegedly abused tenant-friendly law in public bribery scheme

A District housing official helped the realtor obtain confidential information on pending sales, authorities say

A residential building in D.C.
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Federal prosecutors are charging a Silver Spring, Maryland-based realtor with bribing a North Carolina-based FBI agent and a D.C. housing official to take advantage of a 1980 District law that gives renters the first right to buy their homes when they go up for sale.

The U.S. Attorney’s Office for D.C. alleges that realtor Brian Bailey bribed an unidentified employee of the District’s Department of Housing and Community Development (DHCD), which administers the law—the Tenant Opportunity to Purchase Act (TOPA)—to send him confidential information about renters and their buildings. Renters have TOPA rights that they can “assign” to third-parties, including individuals and affordable housing developers.

Authorities say Bailey then convinced FBI agent David Paitsel to use one of the bureau’s databases to obtain the targeted renters’ contact information and send it to him in exchange for money. Bailey sought to persuade the tenants to sell him their TOPA rights, and in some cases he succeeded, later reselling those rights to real estate interests—like title companies—according to court records. WTOP and the Washington Post first reported about the charges.

Per WAMU:

In one specific case in 2017, the D.C. official — who is not named — allegedly gave Bailey inside information on a possible sale of a four-unit building on 15th Street Northwest in Columbia Heights, including the names of the tenants living there. At Bailey’s request, the case alleges, Paitsel looked up and provided Bailey with contact information, which Bailey then used to contact a tenant and purchase their TOPA rights for $10,000.

“Hey Bro… I owe you 5k!!!” Bailey wrote to Paitsel in an email included in the arrest warrant. “I found [the tenant]… He assigned his rights over to me. I’m going to flip the contract to another investor who has already escrowed the money to purchase the property.”

DHCD said it could not comment on the case because the investigation is ongoing. Bailey, the realtor, and Paitsel, the FBI agent, could not immediately be reached for comment. TOPA is intended to help stem resident displacement but no longer includes single-family home sales.