Stealing from Retirees in Michigan

May 10, 2021

Henry Ford Village in Dearborn, Michigan is a large retirement community with over 1,000 units. To live there, seniors and retirees pay fairly high rent, but they also have to put down large deposits that range from tens of thousands of dollars to as much as 350 thousand dollars.

These deposits totaled 112 million dollars. The deposits are supposed to be 100% fully refundable. The company owning Henry Ford Village would hold this money, investing it or accumulating interest on it. When a resident moved out, they would get their deposit back. If a resident died, the deposit would be paid to their family.

But the last couple years, people had trouble getting their deposits back. It seems that Henry Ford Village was running a sort of Ponzi scheme. They would pay people their deposits back using money from the deposits of new residents moving.

And when there were fewer people moving in, the owners claimed they couldn’t afford to pay back the deposits.

Last October, Henry Ford Village declared bankruptcy, leaving former residents and their families due a lot of money.

Now a new company, Sage Healthcare Partners, has bought Henry Ford Village. But, using the bankruptcy laws, they also don’t plan to pay all the deposits back. Residents who already moved out or families of those who died would get zero. Current residents would only get a portion of the deposits back, from 8 to 60%. But it is payable only by how many more years they continued to live there. To get the maximum paid back, they would have to live there another 15 years!

These seniors and retirees will be out of a lot of money that they saved up after working their entire lives. But the laws of this system make this robbery perfectly legal.