In July, however, the Serino family sold the big building to a Limited Liability Company (LLC), fronted by Raymond Bandar and Rudolph Peselman. Other investors are probably involved, but the LLC hides their identities from the public. Former city councilor and real estate investor Bill Walsh has been frequenting the building.

The new owners paid $12.5 million for a property assessed at $7.5 million. They say they will spend $200,000 to upgrade each apartment. All this boosts the assessments, and thus the property tax, on similar buildings in the neighborhood.

During the summer, while the title was still held by the Serinos, tenants began to see big rent increases—some of well over five hundred dollars a month. It can be assumed that the new owners made the higher rents a condition of the sale.

There have already been some eviction notices. There is the smell of condo conversion in the air.

There is a State law offering tenants some protection in condo conversions. However, to use this law, tenants must prove that the owners intend to convert. Without rent control, developers often try to evade the law by emptying the building before they file the master deed required for condo conversion. Big rent increases are used to accomplish that.

Residents have reconstituted their old tenant organization. Attorneys Ellen Shachter and Jeff Feuer now represent the tenants’ association, and some of the tenants individually.

Shachter works for Cambridge and Somerville Legal Services. Feuer is a partner in Goldstein and Feuer in Central Square, with long experience defending tenants rights.

The tenants’ next move was to go to the city council’s September 10 meeting. There they hoped to find support from elected officials.

Councilors Denise Simmons and Henrietta Davis introduced an order—really a request—that the city manager set up talks with the new owners.

But Mayor Ken Reeves brusquely exercised his “charter right” to delay consideration.

Reeves warned the councilors, the tenants, and the viewers at home that if they want to “wage war,” they would “get nothing” from the owners.

Later that night Reeves ushered Simmons, Davis, and attorney Ellen Shachter into a conference room and closed the door. He then spoke as though he were the landlords’ lawyer. He insisted that the new owners would not meet with a tenants association or their attorney. The owners were nice guys, he said, but he did not advise an adversarial approach.

Raymond Bandar and Rudolph Peselman are not strangers to Reeves. He knows them and many of their associates. They are regular donors to his election campaigns.

Decker connects

Raymond Bandar also knows City Councilor Marjorie Decker. He and some of his associates have dependably donated to her campaigns. Plus she is married to Raymond Bandar’s nephew. However, Rudolph Peselman’s first campaign check to her was only deposited on July 23, 2007. That was two days before Bandar and Peselman’s LLC bought 55 Magazine Street. Checks from Beshara Bandar and Bill Walsh were deposited the same day as Peselman's.

Councilor Decker grew up on Magazine Street and once lived at 55 Magazine. So it seemed natural for her to become involved. She assured the residents that their new landlords were not trying to evade the condo conversion law.

Decker offered herself as an intermediary between them and the new landlords. Attorney Shachter believes that she is willing and able to help the older, lower-income tenants to remain in their homes.

Mayor Reeves and Councilor Decker seem to be in close touch with the owners and claim to know their plans. One defends the owners and the other says she is neutral.

Yet who will defend the residents of Cambridge? They, including the tenants at 55 Magazine Street, elected Reeves and Decker to the city council. Our taxes, whether we pay via direct property tax for owner occupied homes or passed on in rent by our landlords, pay their official salaries. Shouldn’t they be on the residents’ side?

Been there, done that

Not long after Bandar and Peselman took out mortgages on 55 Magazine, Mr Bandar himself took out a smaller mortgage on his condo unit just down the street at 128 Magazine.

This 16-apartment building was converted to condos in 2004. The conversion was done by an LLC run by Bandar himself, Philip Grefe (who is also involved at 55 Magazine), and another developer named Margaret Morrissey.

In the past few years, Ms Morrissey has contributed at least $1500 to Decker and at least $1000 to Reeves.

Of the 16 condo units in 128 Magazine Street, at least ten are owned by absentees who rent them out. One of those absentees is Mr Bandar. Another is Muireann Glenmullen, who also teamed with Bandar on a condo deal at 17-19 Brewster Street.

Glenmullen is also a partner of former city councilor Bill Walsh in First Camreal Corporation.

Last year Glenmullen and Walsh sold a condo on 34B Prince Street to Omar Bandar, "Special Assistant" in Mayor Reeves' office. They sold a 63 Walden Street condo to City Councilor Marjorie Decker last December.

Glenmullen also worked condo deals at 47 Chilton Street and 15 Bucking-ham Street with a Mr Leonard J Aronson. Remember that name.

Raymond Bandar has been involved in numerous conversions— 63 Walden Street, 105-107 Montgomery Street, 15-17 Gold Star Road, 12 Regent Street, 4 Kenway Street, 14 Cottage Street, and 32-38 Prince Street. He has also owned commercial properties in Porter Square, where for many years he ran the delightful Averof restaurant.

In Somerville, Bandar has been involved in 62-64 Cameron Ave, 162 Summer Street, and 110 Perkins Street.

Many of the documents for these deals were notarized by attorney Dianne C. Alves, whose return address is listed as 26 Hurlbut Street, number 2. That is the home/office address of former city councilor Bill Walsh.

Peselman’s past

In the 1980s, Rudolph Peselman was V.P. of Eric Management, a Newton-based real estate development and management company. Eric’s president was Leonard J Aronson, then and now a major financial contributor to both the state and national Democrat parties.

Aronson has also donated regularly to several local Cambridge politicians, notably Kenneth Reeves.

Aronson and Peselman teamed up in 1986 as trustees and beneficiaries of Star Trust. Star’s core business was converting apartments into condos.

Aronson and Peselman had a third partner in Star, Mr Robert Stoller. Now Mr Stoller was also the president and chief loan officer of Coolidge Corner Co-operative Bank, Star’s sole source of capital.

This is called insider lending and it is against the rules for government-insured banks. By the time the FDIC caught on, Stoller had loaned Aronson and Peselman $4,369,000 to speculate in condo conversions.

Coolidge Corner was one of several hundred banks that were ruined in the real estate bubble of 1987-1992. Aronson and Peselman were sued and some of their properties were foreclosed. Peselman was sued in one case together with Cambridge city councilor Bill Walsh, who was himself convicted in 1994 for mortgage fraud in connection with condo conversions. So these guys go back a long way.

Mr Peselman’s legal troubles were not over. In 2003, he was one of the directors of Chancellor Corporation, a Boston transportation equipment dealer, charged with securities fraud—“wholesale fabrication of corporate documents,” in the words of the SEC. Millions of dollars were moved around on paper to conceal real losses from investors.

Peselman was accused of signing false financial statements and conniving at “ongoing improprieties.” In a 2005 settlement, he was ordered never again to serve as an officer or director of any public company in the U.S.

Thus he had to quit his position as secretary of Novelos Therapeutics, a corporation set up to market a chemotherapy drug developed in Russia.

Novelos’ financial backer, David Blech, must have sympathized. He had himself just got off probation for a 1999 securities fraud conviction. (Blech had been the top biotech investor in both Israel and the U.S.) Previously Mr Peselman had operated Kent International, with addresses in Newton and in Moscow.

In recent years, Leonard J Aronson, Rudolph Peselman, and Raymond Bandar have each written checks to Ken Reeves’ city council campaigns.

Mr Bandar has also been generous to Anthony Galluccio, David Maher, Michael and Edward Sullivan.

Messrs Peselman, Walsh, and Blech have not let legal problems and their CORI records discourage them. They are an inspiration to the millions of youth who cannot get a job because of their CORIs (see this issue, pages 2 and 3).