Benchmark Municipal Tax Services is suing the City of Ansonia over what it alleges is fraud and a breach of contract.
ANSONIA – A tax collection agency is suing the City of Ansonia over at least a million dollars it says it’s owed.
In a complaint filed in state Superior Court, Benchmark Municipal Tax Services alleges that the city committed breach of contract and fraud in a series of tax lien sales. It says the city gave Benchmark bad information, preventing the company from collecting debts it had purchased.
The lawsuit demands money damages and punitive damages, as well as attorney’s fees. The demand does not include a number.
Benchmark is a tax collection agency that does business with cities. It purchases tax liens – or back taxes on property owed by city taxpayers – and collects those debts for itself. In exchange, the city typically gets a lump sum of cash from the agency.
According to the complaint, Benchmark bought at least eight batches of tax liens that were based on bad info. It says the city sold liens that don’t actually exist; liens that had already been paid off; and liens with incorrect numbers.
Benchmark said it paid $1,383,666.72 for one of those batches. The lawsuit claims the company is entitled to a full refund for that batch.
The lawsuit says that Benchmark had brought up the issues with the city beforehand.
It says the city promised to pay them back for the bad debts using proceeds from the WPCA sale last year.
“Ansonia stated many times that it was going to sell the entire WPCA and pay Plaintiff for all deficiencies, reductions, and misrepresentations out of the sale proceeds,” the complaint states.
Although Mayor David Cassetti’s administration finalized its sale of the WPCA in December, Benchmark said it still hasn’t been paid.
“The Defendants never paid or compensated the Plaintiff for the aforesaid deficiencies, errors, and misrepresentations, though they specifically represented they would do so,” the complaint says.
The lawsuit also alleges that some taxpayers had paid their back taxes to the city, instead of to Benchmark, and that the city kept that money for itself instead of passing it on.
It says the city’s actions violated the Connecticut Unfair Trade Practices Act (or CUTPA), and that Benchmark has suffered financial losses as a result.
The city has until April 8 to respond in court, according to the return date on the complaint.
Reaction
Ansonia Corporation Counsel John Marini issued the following statement:
“While the City and Benchmark have engaged in settlement discussions relative to this claim, no settlement agreement was ever reached,” Marini said. “This is due to Benchmark’s refusal to take accountability for their own failure to perform due diligence prior to purchasing the liens, as required by the lien sale contracts.”
The Ansonia Democratic Town Committee (DTC) highlighted the lawsuit and criticized the administration in a Facebook post, saying it’s time to vote new people into office.
“In short, Benchmark claims Ansonia lied about the liens, improperly kept payments, and engaged in bad-faith business practices. If the court agrees, the city could face significant financial penalties,” the post reads.
The Valley Indy left a voicemail requesting further comment from Dave Hannon, chairman of the Ansonia Democrats.
Cassetti said his administration is more transparent than the one that came before it.
“For fourteen years when the previous administration was here, controlled by the Democrats – every seat on the Board of Aldermen – nobody said nothing. But nothing ever got done in this town,” Cassetti said. “I’m jumping over things, getting things done in record speed, and people are complaining about things. We don’t need new blood. We have an imagination, we have good things on the schedule of what I plan on doing.”
Benchmark is represented in the lawsuit by the law office of Juda J. Epstein, a Bridgeport-based attorney.
