#169 Spring 2012 — Health

Florida Flipper Nabbed in Cleveland

The head of a sham financial corporation was arrested late last year for illegally flipping hundreds of homes in several Ohio counties, including Cuyahoga County, home to Cleveland and noted […]

The head of a sham financial corporation was arrested late last year for illegally flipping hundreds of homes in several Ohio counties, including Cuyahoga County, home to Cleveland and noted for both its large numbers of vacant properties and for the various creative tools being tried out to deal with them.

Blaine D. Murphy, aka Bryce Peters, a 43-year-old from Florida, flipped real estate “like hamburgers,” according to an editorial in The Plain Dealer, in an attempt to cash in on the foreclosure crisis. Murphy was not cleared to do business in Ohio to buy and sell foreclosed houses, and allegedly signed phony deeds using various aliases. Between August 2003 and the time of his arrest in late 2011, Murphy owned more than 500 properties in Cleveland alone, and he left the houses he couldn’t sell to rot. Those neglected properties, some of which were vacant for nearly a decade, spelled ruin for their neighbors, and sometimes for entire Cleveland blocks, says Frank Ford, senior vice president for research and development at Neighborhood Progress, Inc.

Murphy now owes more than $700,000 in property taxes and $9.5 million in contempt of court fines in housing court. He has also cost the city more than $300,000 for properties that were demolished — properties first purchased from major lenders like Deutsche, Citi, Chase, and Wells Fargo.

This state of affairs prompted Cleveland Housing Court Judge Ray Pianka to work with the Cuyahoga County Prosecutor’s Office and the FBI to track Murphy down. They found him in his $1.2 million Naples, Fla., home.

Murphy’s arrest, while satisfying, is an exception to the rule: the misdeeds and malfeasance that have harmed our communities unfortunately don’t usually appear in the police blotters. But how easily Murphy operated to flip properties by filing forged deeds has caused a good deal of alarm — and harm.

The FBI’s investigation revealed Murphy, as Bryce Peters, doing business all over the country. If Murphy got away with this for so many years, how many others are there doing the same who don’t have the Cleveland Housing Court on their trail?

OTHER ARTICLES IN THIS ISSUE

  • Breathing Easier

    July 24, 2012

    A Massachusetts-based program provides home environment assessments, education, and home remediation services—often resulting in the improved health and lives of families.

  • A New Way to Explore Participatory Action Research

    July 24, 2012

    Research for Organizing Toolkit, a web-based tool by Alexa Kasdan, Lindsay Cattell, and Rosten Woo for the Community Development Project of the Urban Justice Center, 2012.

  • Advocacy Proposal or Call to Do Nothing Some More?

    July 24, 2012

    Sharing the Pain and Gain in the Housing Market: How Fannie Mae and Freddie Mac Can Prevent Foreclosures and Protect Taxpayers by Combining Principal Reductions with "Shared Appreciation," John Griffith and Jordan Eizenga, Center for American Progress, March 2012.