House Oversight Committee investigates DC’s home equity theft

Washington, DC; June 16, 2026: Today, the House Committee on Oversight and Government Reform opened an investigation into the District of Columbia’s home equity theft (HET) — a practice where the government seizes and sells a home over a small tax debt, then pockets all remaining value, robbing the homeowner of the equity they had built in their home. The Committee’s announcement notes that DC’s ongoing practice of HET runs directly counter to the Supreme Court’s unanimous 2023 ruling in Tyler v. Hennepin County, which held that such practices violate the Constitution.

Although many states and jurisdictions have taken steps to comply with the Court’s ruling, DC has refused. The Committee reports that its investigation follows dismissive responses by DC’s attorney general and months of refusal to provide a response or comply with the Court’s ruling by DC’s mayor.

“DC is taking generational wealth from families who worked their whole lives to build it,” said Christina Martin, a senior attorney with Pacific Legal Foundation, who argued the Tyler case. “The Supreme Court made clear in Tyler v. Hennepin County that this is unconstitutional — yet DC remains one of the last jurisdictions still doing it. These families deserve to keep the equity they’ve built, not watch the government hand it to private investors over debts a fraction of their home’s value.”

Last year, Pacific Legal Foundation filed a lawsuit challenging DC’s predatory foreclosure scheme on behalf of the Powell family. Gaston Powell, Sr., and his wife Mattie Bell raised 11 children in their Trinidad neighborhood home. After the last family member living there died in 2020, DC classified the property as vacant and multiplied the tax rate by 600%. A $5,000 yearly tax bill ballooned to $30,000. When the family fell behind, DC sold the debt — then roughly $41,000 — to private investors and increased the annual tax rate to a punitive 10%. When PLF client Juanita Powell filed suit last year, the interest and penalties exceeded $231,000. Today, they are over $360,000. Now, the private investors are moving to foreclose on a home that DC currently assesses as worth more than $711,000 — leaving the Powell family nothing.

Pacific Legal Foundation represents the Powell family free of charge. The case is Clear Sky Holdings, LLC v. Estate of Gaston Powell, Sr.

PLF has worked to end home equity theft across the country for over a decade and will continue to fight for families like the Powells until the practice is eradicated.

Image credit: Gary Blakeley, Adobe Images.