Pubdate: Sun, 31 May 2015
Source: New York Times (NY)
Copyright: 2015 The New York Times Company
Contact: http://www.nytimes.com/ref/membercenter/help/lettertoeditor.html
Website: http://www.nytimes.com/
Details: http://www.mapinc.org/media/298
Author: Kim Barker

CHOICE FOR ADDICTS: USE AGAIN, OR LOSE HOME

After a lifetime of abusing drugs, Horace Bush decided at age 62 that 
getting clean had become a matter of life or death. So Mr. Bush, a 
homeless man who still tucked in his T-shirts and ironed his jeans, 
moved to a flophouse in Brooklyn that was supposed to help people 
like him, cramming into a bedroom the size of a parking space with 
three other men.

Mr. Bush signed up for a drug-treatment program and emerged nine 
months later determined to stay sober. But the man who ran the house, 
Yury Baumblit, a longtime hustler and two-time felon, had other ideas.

Mr. Baumblit got kickbacks on the Medicaid fees paid to the 
outpatient treatment programs that he forced all his tenants to 
attend, residents and former employees said. So he gave Mr. Bush a 
choice: If he wanted to stay, he would have to relapse and enroll in 
another program. Otherwise, his bed would be given away.

"'Do what you do' - that's what he told me," Mr. Bush recalled.

Mr. Bush, rail-thin with sad eyes, wanted to avoid the streets and 
homeless shelters at all costs. He turned to his self-medication of 
choice: beer, with a chaser of heroin and crack cocaine. Then he 
enrolled in a new program chosen by Mr. Baumblit.

In the past two and a half years, Mr. Bush has gone through four 
programs, just to hold onto his upper bunk bed.

Mr. Bush had fallen into a housing netherworld in New York City, 
joining thousands of other single men and women recovering from 
addiction or with nowhere to go. The homes are known as 
"three-quarter" houses, because they are seen as somewhere between 
regulated halfway houses and actual homes.

Virtually unnoticed and effectively unregulated, the homes have 
multiplied over the past decade, driven by a push to reduce shelter 
rolls, a lack of affordable housing and unscrupulous operators.

One government official estimated recently that there could be 600 
three-quarter houses in Brooklyn alone. But precise numbers are 
elusive. The houses open and close all the time, dotting poor 
neighborhoods mostly in the Bronx, Brooklyn and Queens.

Daniel Puff, a recovering drug addict, is caught in an unregulated 
housing system, known as "three-quarter" housing, that preys on the 
vulnerable homeless.

The homes, often decrepit and infested with vermin, overflow with 
bunk beds and people. Exits are blocked and fire escapes nonexistent. 
The homes are considered illegal because they violate building codes 
on overcrowding. Many have become drug dens, where people seem almost 
as likely to die of overdoses as they are to move on to a home of their own.

Opportunistic businessmen like Mr. Baumblit have rushed to open new 
homes, turning them into vehicles for fleecing the government, an 
investigation by The New York Times found. The target is easy: 
vulnerable residents whose rents and treatments are paid for with 
taxpayer money.

Yet three-quarter homes are tolerated and even tacitly encouraged, 
pointing to a systemic failure by government agencies and 
institutions responsible for helping addicts and the poor.

Reputable hospitals, treatment programs and shelters regularly send 
people to the homes. So does the state's Department of Corrections 
and Community Supervision. The city's Human Resources Administration 
pays operators the $215 monthly rent, known as a "shelter allowance," 
for many tenants. The state's Office of Alcoholism and Substance 
Abuse Services hands out millions in Medicaid money for their treatment.

But for years none have paid attention to what happens inside. There 
are no regular inspections. No requirements. No registry. The city's 
Department of Buildings, overwhelmed and ineffectual, often fines the 
landlords, but the city does little to collect.

The system, such as it is, dooms tenants to a perpetual cycle of 
treatment and relapse, of shuttling between programs and three-quarter houses.

"The city knows it's happening," said Paulette Soltani, who works at 
the Three-Quarter House Tenant Organizing Project, which advocates 
better housing conditions. "The city is sending people to these 
homes, but the city is not regulating these homes."

Over the past six months, The Times pieced together information about 
Mr. Baumblit's operation through interviews with more than 85 current 
and former tenants, a review of thousands of pages of court and 
medical records and a database of housing payments from the city's 
Human Resources Administration.

Steven Banks, commissioner of the Human Resources Administration, 
said on Friday that his agency had recently started investigating 
several three-quarter-home operators, including Mr. Baumblit's company.

"Unfortunately the state rental allowance for a single adult is 
$215," Mr. Banks said. "And given the dynamics of the housing market 
in New York City, there are landlords that victimize our clients 
because all they can afford to pay is the shelter allowance."

Mr. Baumblit's company, the Back on Track Group, is not the biggest 
in the three-quarter housing world. But the paper trail on him offers 
a detailed look at how such a business works and how little scrutiny 
it gets. Among advocates and tenants, Mr. Baumblit has acquired a 
reputation as a particularly brutal operator.

He and his employees at Back on Track declined to comment. But 
Matthew S. Aboulafia, a lawyer for Mr. Baumblit, said on Wednesday in 
written responses to questions from The Times that Back on Track 
provided a service, and had not acted illegally. Mr. Aboulafia also 
said that the company did not receive kickbacks from treatment 
providers and denied that any residents were told to relapse.

Mr. Bush was one of about 120 people who lived at any one time in Mr. 
Baumblit's biggest operation, a row of six identical beige houses on 
New Lots Avenue in East New York, Brooklyn. Like Mr. Bush, some were 
addicts. Others were simply homeless, people who did not need 
treatment but who wanted to avoid the shelter system. Some had 
serious mental illnesses.

Birshon Daley, 34, who has paranoid schizophrenia, moved onto New 
Lots more than three years ago. Fond of wearing an orange lei and 
blasting Spanish lessons on a boombox, he appeared to hear voices and 
responded to questions not asked. He spoke in non sequiturs, such as: 
"I have a dysfunctional friend. I'm good at math."

Mr. Daley was one of 10 people in his apartment. He slept in a bottom 
bunk, on a grimy mattress with no sheets, in a room so run-down that 
the doorknob was a dirty sock tied through a gaping hole. At Mr. 
Baumblit's request, Mr. Daley said, he made a house manager 
responsible for administering his disability check. Mr. Baumblit took 
the money for rent and then gave Mr. Daley an allowance.

"Five dollars a day," Mr. Daley explained. "After cleaning the yard, 
taking out the trash."

Mr. Baumblit, 64, a bald fire hydrant of a man who sports a yellow 
windbreaker and a blue baseball cap, even in winter, evicted tenants 
on a whim, they said. He threatened others if they fiddled with the 
thermostat, if they used the gas burners for heat, if they did not do 
their chores or obey the rules. At one house, he forced a recovering 
crack addict to sleep on the hardwood floor for months, and removed 
the couches as punishment. At another, he head-butted a man.

But residents had little recourse. Mr. Baumblit was more than their 
landlord. He was their overseer, their guardian. He determined 
whether they had a home.

In 1981, Mr. Baumblit left Russia for Brighton Beach, a Russian 
enclave in Brooklyn.He opened a deli there but was sued by his 
partner, who wanted to dissolve the business and accused Mr. Baumblit 
of forging her signature on checks and slapping her. An import 
business he invested in barred him from entering its offices for what 
the company's lawyer described as an "unprofessional demeanor."

An avid gambler, Mr. Baumblit at one point went on a spree in 
Atlantic City, cashing $880,000 in bad checks at five casinos, 
according to court records. He was ordered to pay the money back, but 
it was unclear how much progress, if any, he had made.

Mr. Baumblit went on "disability retirement" in 2000, according to a 
doctor's note in a court filing five years later. (Mr. Aboulafia said 
on Wednesday that his client, who had a heart attack in 2002, had not 
gone on federal disability until 2012.)

Behind the scenes, though, Mr. Baumblit began running medical clinics 
with his wife, Rimma.

In late 2005, the state accused the Baumblits of being the 
masterminds in a plot to use their clinics to defraud insurance 
companies with fake injury claims. Eliot Spitzer, then the state 
attorney general, said the couple would be "prosecuted to the fullest 
extent of the law."

Though facing up to 25 years in prison, the Baumblits embarked on a 
new business, one in which they did not have to deal with government 
regulators.

Three-quarter houses, also called sober or transitional homes, are a 
product of the murky world of outpatient substance abuse treatment 
for the poor. Their numbers have grown in the past decade, as the 
administration of Mayor Michael R. Bloomberg pushed to reduce shelter 
rolls and the economy sank.

The homes promise a better future, with aspirational names like 
Freedom House and Miracle House. But sex offenders live in some 
three-quarter homes. Fires have damaged others. In May 2014, parole 
officers sent a mentally ill man to a three-quarter house run by a 
group called MCM Faith. Nine days later, in a crime that attracted 
widespread attention, he fatally stabbed a boy and injured a girl in 
an elevator of a Brooklyn housing project, the police said.

No one knows exactly how many of these homes exist today. Robert 
Kent, chief counsel for the state substance abuse services agency, 
mentioned a colleague's estimate that there might be 600 in Brooklyn, 
while testifying in a case involving three-quarter homes in December. 
Mr. Banks, of the Human Resources Administration, said that the 
figure seemed high but that the homes are difficult to track because 
"they pop up and go away."

The troubled people who wind up in the homes have few options. Many 
see the city's shelter system as even more dangerous. Single people 
on public assistance have received the same housing allowance since 
1988, $215 a month, not enough for much of anything in a city where 
the median monthly rent is more than $1,200.

In 2007, companies controlled by the Baumblits rented out three 
houses on Miller Avenue in East New York, marking the couple's start 
in the business. People on public assistance were charged only their 
housing assistance checks. But anyone on disability - and, 
increasingly, Mr. Baumblit sought out such tenants - paid a total of 
$300 a month.

Mr. Baumblit then made deals with treatment providers and required 
his tenants to go where he told them, according to tenants and former 
employees. By law, people are supposed to be able to choose their own provider.

A few people in Back on Track did not have to attend a group, tenants 
said, but they had to pay more in rent - $450 a month.

After pleading guilty to two felonies in the insurance-fraud scheme, 
Mr. Baumblit was sent to jail for three months in September 2009. His 
wife pleaded guilty to one felony and served nine days in jail.

Soon, the couple's three-quarter homes began drawing complaints. In 
December 2010, MFY Legal Services, a nonprofit that has represented 
three-quarter-house tenants, filed a class-action lawsuit that is 
still continuing.

But Mr. Baumblit bulldozed through such problems.

A week after the lawsuit was filed, the Baumblits formed a new 
company, Steps to Better Living, which ran the homes for more than a 
year. Soon after a fire at a Steps to Better Living home in Queens in 
April 2012, the Baumblits formed the Back on Track Group.

In November 2012, Mr. Bush landed at New Lots, just off the end of 
the No. 3 subway line in Brooklyn, in one of the city's most violent 
neighborhoods.

His road to Back on Track was not unusual. Mr. Bush grew up in an 
abusive home in the Bronx, the son of an alcoholic former Marine and 
the woman he beat. At 6 or 7, he started drinking alcohol. At 15, he 
started using cocaine and heroin. At 26, he first tried to quit. At 
55, he saw his first psychiatrist.

"Mr. Bush is friendly with melancholy disposition," an evaluation 
report from one inpatient center said, noting he had depression. "His 
persona is grieving."

Mr. Bush, a former construction worker and handyman, said he learned 
about Back on Track at Mount Sinai Beth Israel's inpatient 
rehabilitation program. A Back on Track staff member made a 
presentation for patients "and asked if anybody cared to go to this 
place," he recalled.

Soon after, Mr. Bush moved into the lower apartment at 698 New Lots 
Avenue. He brought with him a few bags and a talisman, a tiny red 
stuffed bear that came with a Russell Stover chocolate box, which he 
had bought for himself one Valentine's Day to celebrate more than a 
year of sobriety. The bear, dubbed Russell, was a reminder to Mr. 
Bush of when he was doing well. He liked to talk over his problems 
with Russell, because Russell didn't talk back.

Back on Track worked hard to snag men like Mr. Bush. Over the years, 
the company's staff members visited inpatient programs, 
rehabilitation centers and hospitals, promoting Back on Track as the 
next step in recovery. They said they would help addicts with 
housing, treatment and job placement.

Tenants said that reputable places had referred them: inpatient 
programs like Arms Acres in Carmel, N.Y., and Samaritan Village in 
New York; nonprofit advocacy groups like the Fortune Society; 
hospitals like Mount Sinai St. Luke's. Six tenants said they were 
sent by the Bowery Residents' Committee, a nonprofit that helps 
homeless people in Manhattan. Six others were sent by Narco Freedom, 
the largest Medicaid outpatient substance-abuse-treatment provider in the city.

One man said he was one of 30 picked up from a Salvation Army in 
Newark by Mr. Baumblit's employees in two vans.

It is not clear how much the referring organizations knew about Back 
on Track's business model. Officials said in interviews that they 
recommended three-quarter houses because there was nowhere else.

"Three-quarter houses are, in my opinion, the frying pan for people 
who are in the fire," said JoAnne Page, president of the Fortune 
Society, which helps people coming out of prison. "Many of them are 
firetraps, many are very dangerous and many are brutally exploitive. 
They crowd people beyond anything they could justify. But they are 
better than what else is out there, so we use them reluctantly."

Back on Track gave residents letters to hand to the city's Human 
Resources Administration, listing the address where the city could 
send the rent and a photograph of a country estate with a manicured 
lawn and a stately porch.

In reality, bunk beds with dirty, cigarette-scarred mattresses 
blocked windows. Mold stained the ceiling of a bathroom at New Lots. 
Bureaus were missing drawers. Some homes had broken sinks, holes in 
the wall and other problems requiring tenants to be creative: A 
clothes hanger could flush a toilet.

One resident at another Back on Track house caught two mice with the 
same trap at the same time, naming them Mickey and Minnie. Others 
made videos of bed bugs crawling on walls and beds.

Each of the six houses at New Lots had two apartments with three 
bedrooms. The two larger bedrooms each slept four people; two others 
shared a bunk bed in the tiniest room, which had no window. Two 
apartments housed women.

"No standing in front of facility," warned a rule sheet in each 
apartment. "No Hanging out in front of the beauty Salon. No Hanging 
out in front or near Gas Station. You will be discharged if caught 
near these locations."

The tenants rarely complained, not if they wanted to stay. The homes 
were revolving doors of people kicked out in the middle of the night 
or early morning. "Sheets, pillow, blanket," Mr. Baumblit would tell 
a house manager, a recovering addict paid $75 a week. That was the 
signal to strip the bed and pack up a person's belongings in garbage bags.

Mr. Aboulafia said residents were not allowed to touch the 
thermostats because they would "likely break from constant changes." 
He argued that the owners of the buildings were responsible for 
making sure they met code - not Back on Track, which rents the 
buildings. Back on Track's lawyers have said in housing court that 
the company had the authority to evict residents for any reason, at 
any time, but judges have rejected that argument.

Mr. Bush did not want to return to the shelter system, where he had 
been beaten and robbed. He did not want to move in with his sister, 
who lived down South.

So he did what he was told. Mr. Bush made his sliver of his room his 
home, setting up a computer out of parts scavenged from the garbage. 
There, he wrote his thoughts in a file called "My Daily Writings." 
Russell the bear was perched above.

Mr. Baumblit first sent Mr. Bush to an outpatient program called New 
York Service Network. Within five months, he was given a letter that 
said he was doing well, with "consistent negative toxicology 
results." Medicaid paid out almost $13,000 for Mr. Bush to attend the 
program an average of four times a week, records show.

Joseph LaBarbera, New York Service Network's lawyer, denied that the 
program paid Mr. Baumblit money for clients. A ProPublica article 
from 2013 about the treatment program raised similar allegations.

No one at Back on Track helped Mr. Bush with permanent housing, and 
by the time he was supposed to graduate from New York Service Network 
in August 2013, he had no place to go.

'Go to Group'

Around 4:30 a.m. on weekdays, Mr. Baumblit usually left his 
five-bedroom house a block from Brighton Beach, and headed for New 
Lots in a leased black Mercedes sedan that retails for nearly $100,000.

With his right-hand man, Edwin Elie, Mr. Baumblit checked to see if 
tenants had submitted slips proving they had attended their addiction 
treatment support groups the previous day. He ordered a house manager 
to wake those who had not. "Go to group," Mr. Baumblit told them.

"The slips is how he proves people went to group," said a former 
house manager, who spoke on the condition of anonymity because he 
feared retaliation. "In passing, he mentioned, 'If I don't get my 
slips, I don't get paid.'"

The former house manager's assertion was backed up by other former 
employees and tenants.

Group was everything. Tenants still recovering from surgery had to 
go. Even non-addicts had to go to group or pay extra. Some said they 
were told to drink a couple beers on their way to a new program so 
they would test positive for alcohol.

A dozen sober residents of New Lots told The Times they were still 
forced to go to group, including a minister who had lost his 
apartment in a flood; a chef who was unable to keep his job because 
he had to go to group almost daily; and a dishwasher who said he was 
sent to Back on Track after complaining about the conditions at his 
homeless shelter.

"I don't need those groups, not at all," said the chef, Portland 
Ramseur, 52, who last used crack cocaine eight years ago and went to 
Back on Track after his company failed and he lost his apartment. 
"It's a waste of my time. It's stopping me from getting on my feet."

Once tenants finished their treatment program, most were evicted. But 
a dozen tenants said they had been told, by Mr. Baumblit or Mr. Elie, 
to relapse. They were the recyclables, constantly shuttling through programs.

"Either Mr. Ed will come and tell you or Mr. Yury will come and tell 
you, 'You know that your time is almost up, and we'll have to move 
you out, or put you someplace else. And to get someplace else, you 
have to have a relapse, maybe even go into detox,'" Mr. Bush 
recalled. "And then they'll put you back into a program, and they'll 
get your Medicaid authorization back up. And they work on you from 
there. And you just keep going around and around."

In August 2013, after Mr. Bush relapsed to keep his bed the first 
time, Mr. Baumblit sent him to Narco Freedom.

Several months later, Mr. Bush was sent to Canarsie Aware, a small 
nonprofit. Then, in April 2014, Mr. Bush enrolled in NRI Group, a 
slightly larger for-profit program in Midtown Manhattan.

Even though the programs had different names, the same cluster of 
people controlled them, according to court records. Medicaid paid a 
total of almost $20,000 for Mr. Bush's treatment at the three 
programs, records show.

Officials from NRI and Narco Freedom, which has since changed 
management, did not return calls asking for comment on their 
relationships with Back on Track. Patricia Charles, the program 
director of Canarsie Aware, said she did not know of any arrangement. 
She referred questions to Anthony Cornachio, the executive director 
of Canarsie Aware and an owner of NRI, who did not return repeated calls.

For all these programs, the goal was volume, because Medicaid did not 
pay much. The hourlong sessions were available for up to 12 hours a 
day, even on Christmas and Thanksgiving.

At NRI, groups were so important that if an English-language group 
was full, clients who only spoke English could go to a Spanish-language one.

Another tenant, who worked as a house manager for Mr. Baumblit and 
spoke on condition of anonymity because he was afraid of retribution, 
said he had also been told to relapse. Like Mr. Bush, he had attended 
four programs. But this man said Mr. Baumblit had given him $20.

"He'd give you money and say, 'Do what you do,'" the man said.

Some residents said they pretended to relapse to get into a new program.

Modesto Cotto, 47, graduated from Canarsie Aware on Aug. 21. Two 
weeks later, Mr. Cotto signed up at NRI, lying to intake workers 
about relapsing because he wanted to keep a roof over his head. "I 
wasn't giving up my sobriety," he said.

Even just a small bender was a psychological blow for tenants 
struggling to keep their new sobriety in the face of temptations that 
had always won out in the past.

"Oh, my demons - I fight and I fight and I fight and I lose," Mr. 
Bush said. "And Mr. Yury takes advantage of it. This whole 
three-quarter system does. It's made for us to fail."

The Officials

In October 2011, a caller asked the city's Department of Buildings to 
inspect the "illegal living spaces" at one of Mr. Baumblit's houses 
for women in Queens.

Five weeks later, an inspector knocked on the door but a woman 
refused to let him inside. After another failed try, the complaint 
was closed. In April 2012, a fire gutted the basement. Only then was 
the house shut down.

New York's safety net for the poor relies on three-quarter homes to 
solve a problem: They take in the people no one else wants. Yet, 
essentially, nobody regulates these homes.

The city's Human Resources Administration paid Back on Track $148,000 
in housing assistance in 2014. But it does not usually examine 
landlords' backgrounds. It often mails checks to anonymous 
limited-liability companies at post office boxes.

As a way to identify operators of three-quarter homes, Mr. Banks said 
the agency had in the last year begun looking at places that housed 
more than 10 people on public assistance. But so far, despite opening 
several investigations, the department has not taken action against anyone.

The state Office of Alcoholism and Substance Abuse Services regulates 
supportive housing for people in treatment. But it does not approve 
three-quarter houses, because they do not provide any services.

"These houses are not something that we regulate or certify," Mr. 
Kent, the chief counsel for the agency, said in an interview on 
Thursday. "And they are pretty strict and restrictive on letting 
people in who don't live there."

Parole officers often visit parolees at three-quarter homes, 
overlooking the fact that most tenants have rap sheets and that 
parolees are not supposed to knowingly be around anyone with a 
criminal record. A spokeswoman for the corrections department said 
"all parolee residencies are closely monitored by parole officers."

The main people responsible for checking conditions at the homes are 
inspectors from the city's Department of Buildings and Department of 
Housing Preservation and Development, agencies inundated with complaints.

But even when inspectors do get inside and find problems, little 
changes. Buildings Department inspectors have fined the owner of the 
six New Lots buildings more than $145,000 since August 2010. Eighteen 
of those 22 violations were considered "immediately hazardous," for 
overcrowding and failure to have proper exits.

Nothing was paid. Nothing was done.

The housing preservation department, responsible for investigating 
renters' complaints, is similarly impotent. Of 28 complaints in the 
past year, only three led to violations being issued. But tenants 
photographed many of the problems, including peeling plaster, a 
ceiling leak and a bad bathtub faucet.

At a City Council hearing in 2009, the chief of fire prevention for 
the Fire Department called for a list of three-quarter homes to help 
firefighters know if a home was overcrowded or had blocked exits.

Still, no list exists.

In 2009, Bill de Blasio, then chairman of the Council's general 
welfare committee, pushed for guidelines to prevent shelters from 
referring people to three-quarter homes with building violations. The 
measure passed the following year.

But as the city's housing crisis has worsened, shelters have 
continued to send people to Back on Track.

Four men said that the same case manager at Willow Men's Shelter in 
the Bronx, Abdul Bangura, referred them to Back on Track, which sent 
them to New Lots.

"He told me they were going to send me to a place that was better for 
me, because the shelter was very violent," said Jose Perez, 48, who 
went to Back on Track in November, just after a bicycle accident 
landed him in the hospital.

Mr. Bangura did not respond to requests for comment. A spokeswoman 
for the city's Department of Homeless Services, which oversees 
shelters, said they did not refer people to three-quarter houses. She 
described Back on Track as a "rehab and drug treatment program."

With little supervision, many three-quarter homes have devolved into 
havens for drug use.

In 2014, the police responded 159 times to the stretch of houses on 
New Lots - mainly because of disputes and people who needed medical 
aid, often because of drugs.

Residents traded prescription pills and sold their methadone. At 
least two house managers at New Lots used heroin while living there, 
tenants said. One former house manager said that he continued to 
smoke marijuana daily while working for Mr. Baumblit.

Overdoses were not uncommon.

Michael Seaman, 42, was on methadone but otherwise clean for eight 
months when he moved in July to a Back on Track home in 
Bedford-Stuyvesant, Brooklyn. Within two days, Mr. Seaman started using drugs.

"My brother said you could get more drugs in there than on the 
street," his sister Janice Ortiz said.

On Nov. 14, Mr. Seaman overdosed, likely from a combination of Xanax 
and methadone. Roommates found him in the morning, cold and 
motionless in his bottom bunk.

"No one even showed up from Yury's office," said Ramon Ruiz, a 
housemate. "It was like Michael never existed. I had to verify and 
identify the body. I had to notify the family."

Mr. Aboulafia, Mr. Baumblit's lawyer, said Back on Track's secretary 
"notified the family as soon as possible."

Mr. Seaman's relatives from Staten Island said they never heard from 
Back on Track and waited six hours before they were allowed into the 
house to collect his belongings. For more than two weeks, his 
mattress was left as it was, along with his striped sheets and 
blanket with tigers and a jungle scene. And then, the mattress was 
given to someone else.

The Cash Machines

If Mr. Baumblit's tenants were all potential moneymakers, those with 
serious problems represented the easiest money of all: They often 
didn't understand how they were being used.

Some had mental illnesses like schizophrenia or bipolar disorder. At 
least two were developmentally disabled. One had severe hemophilia. 
One resident was described on a mental capacity assessment for 
federal disability as having "psychotic symptoms, very low 
frustration tolerance and tendency towards violence." A few others 
used canes and walkers.

Birshon Daley, 34, who has paranoid schizophrenia, lived in the house 
next to Mr. Bush. Mr. Daley had an unkempt beard and a large bump on 
his forehead that he said was from when his great-grandmother threw a 
can at him. He wandered the neighborhood collecting cigarette butts 
to smoke, asking people for money and occasionally eating food from 
the garbage. At one point, Mr. Daley punched out the glass at a bus stop.

Mr. Daley said he used to live at his aunt's house nearby, but landed 
in a shelter when his father left Brooklyn and his grandfather died. 
About three years ago, he said, that shelter "sent me to this program 
here." Mr. Daley and his housemates all said that he did not use illicit drugs.

He said his federal disability check was about $645 a month. The 
federal government had deemed him incapable of managing it, so he 
needed a "payee" who would receive his check and make sure his needs 
were met. Mr. Daley said that Mr. Baumblit asked him to designate the 
house manager, Lisa Short, as the payee. In return, Mr. Baumblit gave 
him $5 a day to live on, Mr. Daley and two housemates said.

Another housemate, John McLeod, 58, was given the job of 
administering Mr. Daley's medications - an anti-psychotic, a mood 
stabilizer and a blood pressure pill - stored in a plastic shopping 
bag with "Daily" scrawled on it. Mr. McLeod, who had no medical 
training and no idea what pills he was handing out, sometimes hit Mr. 
Daley or threw spoons at him, housemates said. Efforts to reach Mr. 
McLeod were unsuccessful; there are no phone numbers or current 
addresses available for him.

Julian Caraballo, 55, said that he, too, made Ms. Short the payee of 
his disability check, which was for $762 a month. He said Mr. 
Baumblit handed him his daily allowance.

"He gave me $10 every day, for eat," Mr. Caraballo said.

Mr. Aboulafia said residents who picked Ms. Short did so on their 
own. He said that if people received only $5 or $10 a day, it was 
because the rest of the check was deducted "for participating in Back 
on Track's program." Ms. Short could not be reached for comment at 
several phone numbers listed for her and her relatives, nor did she 
respond to a certified letter mailed to Back on Track.

Mr. Baumblit also steered tenants who were not on disability to a 
psychiatrist and lawyer who could get them qualified, tenants said. 
One tenant still had the psychiatrist's card. Another had directions 
to her office in Gravesend, Brooklyn, provided by Back on Track. The 
lawyer's office was next to a Social Security Administration branch 
in Staten Island.

Mr. Aboulafia said some tenants at Back on Track "asked for help with 
qualifying for disability so we provided them with some names of 
people that we thought could help."

In the fall, Mr. Baumblit added another requirement for tenants at 
New Lots. They had to go to a new doctor's office: a storefront at 
887B East New York Avenue, bearing the name of a family doctor, Kevin Custis.

On an afternoon in January, patients in a crowded waiting room said 
they came for free pizza - and because they were paid $20 in cash, an 
illegal incentive. One man said he was a "recruiter" who drove a van 
around to find patients from shelters, churches and welfare offices, 
"where there are people who have Medicaid and don't have money."

Seventeen New Lots tenants said they were driven to the clinic in a 
Back on Track van and forced to undergo three or four hours of 
testing to get a bed. They said they were given ultrasounds and sent 
to one doctor after another.

Mr. Perez went to the clinic on Nov. 6, even though he had just been 
thoroughly evaluated by doctors because of his bicycle accident. 
Medicaid paid doctors more than $1,700 that day for 19 procedures, 
records show, including ultrasounds of cerebral arteries and tests 
for an involuntary eye movement known as "dancing eye."

"I think that's why they're affiliated with Yury," Mr. Perez said. 
"They get rich off all of us."

In an interview, Dr. Custis said he made an agreement with Back on 
Track about a year ago to recruit patients for a clinical study on 
hepatitis C and H.I.V. screening. He said he paid Back on Track $20 
for each patient out of his own pocket.

Dr. Custis said he was the only doctor on the study and named a 
researcher from "the centers for health care disparities out of Mount 
Sinai" that he said was helping him evaluate the results. But a 
spokesman for Mount Sinai Hospital in Manhattan said the center did 
not exist and that no one by the name given by Dr. Custis worked there.

Mr. Aboulafia denied that Back on Track received any money from the 
doctor. He also said tenants were required to get physicals "to 
prevent the spread of infection and disease at the facility." He did 
not explain why scans and ultrasounds were necessary.

End of the Line

In 2013, Mr. Baumblit stopped paying his lease at New Lots, even as 
he continued to collect rent.

By last summer, Back on Track owed Paradigm Credit Corporation, the 
owner of the buildings, more than $300,000.

"All we asked Back on Track to do was pay the rent that they were 
obligated to pay, and every time that I've had a discussion with Yury 
he tells me to go 'F' myself," David Kushner, the head of Paradigm, 
told a Housing Court judge last year.

Mr. Aboulafia said that Back on Track did pay its rent, but to a 
former owner who lost the buildings in foreclosure, "and our rent was 
absconded in the process." When asked whether Back on Track 
complained to the police about the rent being taken, Mr. Aboulafia 
said "no comment."

Last June, Back on Track agreed in court that it would move out by 
Halloween and "make best efforts to relocate the occupants" to other 
three-quarter homes.

But none of the residents were told. Eviction notices were thrown 
away, and Mr. Baumblit kept moving in new tenants.

On Dec. 17, the city marshals showed up. They locked up six of the 12 
apartments, giving the few residents who were not at group 15 minutes 
to grab what they could. On the streets, tenants huddled, wondering 
whether this was really happening. The week before Christmas, 60 
people were suddenly homeless.

In the days that followed, they were allowed to pick up their 
belongings. Some squeezed into the apartments that were still open, 
spreading blankets over mattresses in living rooms.

Many wandered off, heading for shelters, other three-quarter houses 
or the streets. Some used drugs and went into inpatient treatment.

Mr. Baumblit initially tried to collect slips for the tenants who 
remained. But he quickly abandoned New Lots. On Dec. 23, Mr. Baumblit 
showed up with a van to take those on disability to other Back on Track homes.

Several who stayed behind went to court to postpone the evictions. 
They also went to the city's Human Resources Administration to ask 
that it stop paying Back on Track. They said they were told that they 
needed a new address before stopping payments to the old address.

For months, Mr. Kushner also complained to the city.

"The worst part of this is, I contacted every city agency - every 
city agency - they all told me nothing," Mr. Kushner said. "They 
couldn't help me. They don't know who Back on Track is, they don't 
know what it is. And basically they gave me no help whatsoever."

At the end of February, when most of the residents of New Lots were 
long gone, the Human Resources Administration was still paying Mr. 
Baumblit to house 65 people.

Mr. Banks said the agency started investigating Back on Track after 
learning of the mass eviction. But, he said, the agency continued to 
pay Back on Track for housing because it did not want people who 
needed housing to lose it. "We didn't want to render more people 
homeless," he said.

Mr. Baumblit continued to operate, even as his associates ran into 
trouble. The state tried to shut down New York Service Network last 
year for billing Medicaid for unnecessary services. The state's 
attorney general also recently charged Narco Freedom executives with 
kickback schemes and Medicaid fraud involving their own three-quarter homes.

This year, Mr. Baumblit put his house near the beach, with its 
chandeliers, bar and swimming pool, on the market for $3.5 million. 
He told tenants he planned to shut down another three-quarter home, 
this one on Glenmore Avenue in East New York, and ripped out parts of 
the stove so nobody could cook there. He continued to evict tenants, 
even after police charged him with two misdemeanors for unlawful 
evictions. The cases are pending.

Meanwhile, Back on Track opened two new homes in Brooklyn, including 
one on Schenck Avenue in East New York. Its owner was a New York City 
police officer, De'Shawn Ware, whose father was a former house 
manager for Back on Track.

"I have no involvement whatsoever," Mr. Ware said, adding that Mr. 
Baumblit "just rents the location."

Life grew increasingly dire for the squatters remaining at New Lots. 
Mr. McLeod, the man who had dispensed Mr. Daley's pills, kicked him 
out of their apartment. Mr. Daley, off his medications, spent more 
than a month surfing the subways and sleeping where he could. After 
he fell on the ice and landed in an emergency room in February, Mr. 
Daley was given a shot of his anti-psychotic medication and a mood 
stabilizer and released.

Mr. Daley returned to New Lots, where Mr. McLeod refused to let him 
inside. Mr. Bush and his housemates let Mr. Daley stay in their 
living room and fed him. He had gotten no disability money since 
mid-December because Mr. Baumblit's employee remained the payee.

Mr. Bush, who had qualified for disability in 2013, refused to move 
to another of Mr. Baumblit's houses. He often walked to the library a 
block away, submitting subsidized housing applications online for 
places where his disability payments barely reached half the minimum 
income needed. He called numbers for programs catering to seniors, 
and for houses that said they would charge him $500 a month for a 
bed. No one called back.

At the end of March, the marshals locked up the apartment where he 
and Mr. Daley were staying. Most tenants went to other three-quarter 
houses or shelters.

Mr. Daley packed up his worldly possessions into two plastic bags and 
moved next door, to the lone New Lots apartment that remained open, 
crashing there with three others, even after the electricity was cut 
off, until they all finally left.

Mr. Bush, now 65, put his suitcases, including one with a strip of 
tape that read "Bush Traveling Clothes," into a shopping cart. He 
would soon go to a residential treatment program, one he had already 
been through twice. To qualify, he knew what he had to do: He had to 
use. "There's nowhere else for me to go," he said.

When he moved, he brought Russell, his talisman, his reminder of 
better days, placing the bear near his bed in his new room. This 
time, he told Russell, he would get clean. This time, he said, things 
would be different.

Susan C. Beachy contributed research.
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MAP posted-by: Jay Bergstrom