RALEIGH, N.C. (WPTF) – North Carolina Attorney General Jeff Jackson announced a settlement with a major landlord accused of illegally fixing rent prices using cutting edge technology. Landlords were using RealPage, a property management software provider known for AI-powered solutions and services that has allegedly exploited landlords’ competitively sensitive information creating a pricing algorithm that inflated rent prices and violated antitrust laws
A settlement was reached with Cortland Management LLC, which is the second-largest landlord in North Carolina with over 5,000 units statewide, including Charlotte and Raleigh. Under the settlement, Cortland agreed to stop using sensitive data from its competitors to inform its pricing model. It must also submit to regular compliance inspections.
“[Landlords] are not allowed to meet in the back of a restaurant and decide what rates to charge,” said Jackson. “They were essentially using artificial intelligence as a stand-in for that type of in-person meeting allowing them to share proprietary information to the detriment of renters.”
Rent prices are meant to be decided based on a number of factors including market analysis, property features, operating expenses, and through other professional advice. In a press release, Jackson stated this alleged illegal conduct not only harms landlords trying to follow the rules, but also North Carolinians who struggle to pay rent and keep their homes with increasing rent prices.
Jackson also said the technology is being used for other illegal purposes such as fraud, deepfakes and other financial crimes.
“Folks are getting a call from someone who sounds exactly like their grandson saying ‘Grandpa, I was just arrested and I need you to send me some bail money and I need it to be in crypto-currency’ or something like that,” said Jackson. “It’s a combination of AI plus crypto-currency that’s opened up a new tsunami for scams.”