Padspin; Jeff Segal (CEO) Did not refund my deposit for an apartment; withdrew before application process New York Internet

This start-up business connects prospective renters with tenants willing to break the lease on apartments in NYC, arranges a showing and charges $350 fee for the service. It only tells customers that the fee will only be kept after the apartment deal goes through.

I found them on Streeteasy & went to see the studio in Hell's kitchen. The current tenant showed the place, and asked if I can buy off all furniture. She informed that this is a deal-breaker. She also informed me that she is currently paying $1725, and there is a possibility of lease transfer and keeping the same price.

Even estimating the rent to be $1800 a month, additional $600 dollars made sense. I expressed interest in applying and promptly transferred $350 to Padpin.

It was explained to me that they only way they will keep the money is if the "deal goes through". Nothing was mentioned about the 50% refund or 24 cancellation period. It was also not mentioned that expressing interest is considered "applying".

In the email communication that the tenant CC'd me on, I learned that the landlord didn't deal with customers directly, always going through a specific broker. This is when the legality and legitimacy of the whole arrangement started becoming suspicious.

After 2 more days I got application materials from the landlord. At that point I had to withdraw my interest due to external circumstances. After notifying the business, the landlord and the tenant that I won't be pursuing the application I got zero response from Padspin.

Several emails and calls later they finally responded refusing to issue a refund. Moreover, the CEO (it's a 3-person operation apparently) was extremely rude, and unprofessional suggesting that I ruined business for them and the tenant. Where in fact this is a business process flaw, that the customer should not be responsible for. As many Yelp reviews indicate, lots of other clients struggled with the exact same opaque processes.

Full refund of $350 seems like a proper resultion in this case.