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Rental software companies to pay fines for digital discrimination, says Healey

Massachusetts Attorney General Maura Healey pictured here.David L. Ryan/Globe Staff

A pair of property-management software companies, including one in Boston, have agreed to pay $100,000 in fines after an investigation by Massachusetts Attorney General Maura Healey found that their software illegally discriminated against prospective tenants who use government rent subsidies.

Healey’s office said that the case is part of an ongoing effort to determine whether programs that conduct personal background checks contain algorithms that discriminate against people of color and low-income renters.

Buildium of Boston offers a suite of property management programs that includes tenant pre-screening software from Tenant Turner, a Virginia-based company. Healey’s office found that the Tenant Turner program included a feature that could be set to automatically reject any tenant who was planning to pay part of the rent with a government housing voucher.

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“Here in Massachusetts, it’s illegal to discriminate against someone based on receipt of a government benefit,” said Trini Gao, assistant attorney general in the civil rights division.

The software could also reject tenants who had been convicted of certain felonies. This is permissible on a case-by-case basis, but according to state law, renters aren’t allowed to automatically reject any applicant with a criminal record.

Healey’s investigation began with a referral from the Cambridge Human Rights Commission. That agency had received a complaint from a property management company which had found that prospective renters were being rejected by online pre-screening software, if they said that they were receiving government housing aid. The management company didn’t know why it was happening. But an investigation revealed that this was an optional feature of Buildium’s software that was somehow activated by accident. The investigators also discovered the optional feature for rejecting applicants with criminal records.

Lisa Noonan of Franklin told Healey’s office that she encountered Buildium software in the spring of 2019 when she had 15 days to find a new apartment. Noonan said that online pre-screening programs repeatedly rejected her because she participates in the federal Section 8 housing subsidy program.

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“As soon as I filled out everything, immediately a pop-up came up that said we don’t take Section 8,” said Noonan. “That’s illegal.”

But she could do nothing about it at the time. The repeated rejections caused her to miss the deadline to move. Noonan and her son received an eviction notice, and she fears it will hamper their search for housing if they ever need to move again.

“They just kick you when you’re down,” Noonan said. “We’re low-income. We’re not low-class.”

In a statement, Buildium said that the optional settings on their software were “variable to provide property managers the ability to adjust it in deference to applicable local laws.” Tenant Turner did not respond to a request for comment.

Under the terms of the settlement, Buildium and Tenant Turner will admit no wrongdoing. But the two companies will modify their software to eliminate the illegal practices. Buildium will pay a $30,000 fine, while Tenant Turner, which produced the pre-screening software, will pay $70,000.



Hiawatha Bray can be reached at hiawatha.bray@globe.com. Follow him on Twitter @GlobeTechLab.