In 2000, 62-year-old Lakireddy Balireddy (sometimes written as “Bali Reddy”) was one of the wealthiest landlords in Berkeley, California. Reddy Realty, his company, owned over 1000 rental properties, on top of a thriving restaurant downtown. He was bringing in over $1 million in income each month; and his Berkeley properties alone were worth $60 million.
However, all of that fell apart in 1999. A resident in one of Lakireddy’s buildings spotted a group of men hurriedly carrying a rug out of a unit and loading it into a Reddy Realty van. She noticed that a young girl had followed the men to the van and seemed unusually distraught.
To the neighbor’s horror, she then noticed a leg sticking out of the rug. The situation escalated before her eyes: One of the men tried to pull the girl into the van, and she resisted with all of her might. The onlooker ran outside, stopped them, and instructed a bystander to call the police immediately.
Wrapped in the carpet was 15-year-old Lalitha Vemireddy–still alive, but just barely. Her sister, Sitha Vemireddy, wasn’t as lucky; her body was found at the bottom of the stairwell of the apartment building that the men had just exited. The other survivor at the scene was 18-year-old Laxmi Patati, who lived with the two sisters.
According to the coroner, Sitha had been killed by a carbon monoxide leak caused by a blocked heating vent in the girls’ residence. The accident brought an end to a decades-long scheme that may otherwise have continued unimpeded for many more years.
Investigators discovered that Lakireddy had imported the three teens from his hometown in India and had forced them into prostitution. Sitha had been “given” to Lakireddy by her family when she was just 12 years old, ostensibly under the guise of a better life in America.
When it came to Lakireddy’s despicable crimes, however, this was just the tip of the iceberg.
Authorities arrested Lakireddy in January of 2000–just two days before he was scheduled to leave for India with another human trafficking victim.
Ultimately, the Department of Justice discovered that the landlord and his family had imported dozens of young women each year from “untouchable” communities in India to be trafficked in the U.S. The women were sexually abused by Lakireddy, his sons, and his brother and sister-in-law. In addition, they were forced to work on his properties and in his restaurant for little or no pay. This sexual slavery in California was a continuation of similar atrocities that had occurred on his property in Velvadam, India for years.
One of his former victims stated that she had been “given” to Lakireddy when she was nine: “The day I was given to him, my childhood ended and my misery began,” she said.
Ultimately, Lakireddy served just 8 years in prison and paid $2 million in restitution to Sitha’s family; as well as Laxmi Patati, the third human trafficking victim in the apartment.
Human Trafficking: What It Is & How to Spot It
In 2014, an estimated 21 million people were being held in what Human Rights First describes as “modern-day slavery.” It’s believed that 22% are victims of sex trafficking, and the remainder are forced into mining, agriculture, manufacturing, and other hard labor industries. 55% of victims are female, and 26% are children. Traffickers earn a profit of about $150 billion each year, $99 billion of which is a result of commercial sexual exploitation. In 2015, there were only 18,930 prosecutions and 6609 convictions for human trafficking around the world.
Landlords and property managers may be surprised by how much they can do to help vulnerable women and children and assist law enforcement. For example, one Oregon landlord’s suspicions were aroused when he noticed the delivery of an unusual number of mattresses to a house that he was renting out–and later installed a stripper pole. After keeping an eye on the property for a time, he was ultimately able to evict them.
Be on the lookout for the following signs. These indications may seem odd but innocent upon first glance; but in combination, they may be a sign of human trafficking:
- A dwelling has too many people living in it.
- The property garners an unusual amount of traffic.
- The tenant installs interior locks on doors and windows–to keep people in, not to keep people out.
- A tenant or applicant does not have access to her own personal documents.
- An adult tenant does not appear to be allowed to drive herself anywhere.
- A tenant or resident always seems to need someone else to speak for her, though the two don’t seem to know one another well.
- Individuals appear fearful or show signs of abuse or malnourishment.
- A group of people is picked up, taken somewhere else, then brought back at around the same time every day.
- A tenant is unusually anxious after mentioning law enforcement.
- A tenant avoids eye contact.
- A tenant or guest lacks of knowledge of her whereabouts–even about what city she’s in. This is because human trafficking victims rarely leave their residences, except to be transported to a new location.
- Conversations always seem to be scripted or rehearsed.
A San Francisco Gate article on the arrest of Lakireddy (who they refer to as Reddy) is also informative:
“A women who works in an office building down the block that is also owned by Reddy said yesterday that she often saw teenage girls dressed in traditional Indian saris performing tasks such as painting and hauling trash at the properties in the neighborhood owned by Reddy.
“‘It’s always struck me that they were using women,’ said the woman who did not want her name used. ‘It doesn’t surprise me in the least that Mr. Reddy has been accused of this.’
“The office worker said the girls all appeared to be in their early to mid-teens and were watched over by older men.
“‘We thought they treated them like slaves,’ she said. ‘They always looked so sad.'”
In a more recent case, the owners and management of the Roosevelt Inn, a motel in Philadelphia, are facing personal civil liability. Investigators discovered that traffickers had used the hotel to sexually exploit a young girl for two years to over a thousand different men–starting when she was just fourteen.
The girl, now 17, is suing the hotel’s owners, management company, and hotel manager Yanga Patel personally.
Patel denies knowing that anything illegal was happening: “I was always in the office[.] I didn’t see anything wrong.”
The victim’s attorney responded, “You have to be blind[,] deaf and dumb not to know that over 100 men are showing up over a period of a couple days. You have a cleaning crew that comes into the room and [oftentimes] finds boxes or waste cans full of [used] condoms. […] This is about as open and obvious as it gets.”
He continues: “You can’t have a line of johns out the front door and around the room waiting without them knowing the linen service was [extraordinary.] The front desk would direct the traffic to the room of this child.”
As one example of potential landlord or property manager liability, Pennsylvania passed an anti-trafficking law in 2014 that gives state officials broad latitude to seize all assets “derived from, involved in or used or intended to be used” to conduct human trafficking, as well as all assets of individuals or organizations involved in committing or planning these crimes.
Human Trafficking: Can Landlords Be Held Liable?
Some jurisdictions have passed laws that potentially hold landlords criminally and civilly liable for allowing the use of a property for prostitution or human trafficking.
Some human trafficking advocacy resources advise landlords and property managers to ask tenants about where they’re from and what their relationship is to one another. This is spectacularly bad advice that can easily lead to illegal housing discrimination. You’ll face an uphill battle in court, in addition to thousands of dollars in fines for each incident. If you’re a licensed real estate professional, you could also jeopardize your license.
Law enforcement officials do not recommend attempting to rescue a human trafficking victim by yourself. Traffickers can be violent and dangerous, and they may well retaliate against the victim you’re trying to help.
If you suspect human trafficking on your property or a property that you manage–or anywhere else, for that matter–contact the National Human Trafficking Resource Center. They’ll work with law enforcement to investigate the situation and ask the questions that you can’t. Additionally, law enforcement can prosecute offenders simply for lying to them–something that you can’t do when you’re questioning a tenant about human trafficking or other illegal activities. You can learn more about residential brothels and other sexual trafficking scenarios on the National Human Trafficking Hotline‘s website.
To report suspected human trafficking, call 1-888-373-7888, or text “HELP” or “INFO” to 233733.
Writing about personal finance and investments since 1999, Jason Van Steenwyk started as a reporter with Mutual Funds Magazine and served as editor of Investors’ Digest. He now publishes feature articles in many publications including Annuity Selling Guide, Bankrate.com, and more.