Neighborhood still pays for ‘slumlord’ scams

While in­fam­ous River Wards slum­lord Robert Coyle is be­gin­ning a six-year sen­tence in fed­er­al pris­on for loan fraud, the neigh­bor­hood is still deal­ing with the af­ter­math of his rampant row-home fraud, as well as new scam­mers du­plic­at­ing Coyle's tac­tics.

Robert N. Coyle, Sr., who was dubbed the ‘slum­lord mil­lion­aire’ and is ar­gu­ably the most in­fam­ous land­lord in re­cent Phil­adelphia his­tory, was sen­tenced to six years in pris­on for mort­gage fraud earli­er this month.

But most people seem to think he got off easy.

“The man was hor­rible. He, all by him­self, was able to des­troy neigh­bor­hoods,” said Sandy Salzmann, ex­ec­ut­ive dir­ect­or of the New Kens­ing­ton Com­munity De­vel­op­ment Cor­por­a­tion. “He caused hav­oc.”

“I des­pise the man and think he’s the dev­il in­carn­ate,” said Laura Sem­mel­roth, a com­munity or­gan­izer at NK­CDC. “Most people I talked to … thought six years was way too little. Giv­en the dam­age he had done to com­munit­ies, that that was not nearly at all what he should’ve got­ten.”

Coyle is a Kens­ing­ton nat­ive who owned an es­tim­ated 480 prop­er­ties in the Kens­ing­ton and Port Rich­mond area un­der the names of more than ten com­pan­ies — in­clud­ing Land­vest, Alivest, Ram­cram, Ten In­vest­ments, Memory and JC Real Es­tate, all headquartered at 2332 Al­legheny Ave. in Port Rich­mond.

Coyle is be­lieved to have scammed at least 150 homeown­ers out of large sums of money with fake rent-to-own agree­ments, and is con­sidered re­spons­ible for wide­spread blight.

Coyle, 68, now of Glass­boro, N.J., was sen­tenced to six years in pris­on two weeks ago. He pleaded guilty in Oc­to­ber 2012 in U.S. Dis­trict Court for the East­ern Dis­trict of Pennsylvania to two counts of loan fraud. The U.S. At­tor­ney’s Of­fice se­cured Coyle’s con­vic­tion on the grounds that Coyle de­frauded East River Bank for $3 mil­lion and First Re­pub­lic Bank for $6.6 mil­lion by mis­rep­res­ent­ing his in­come from his prop­er­ties and the val­ues of those prop­er­ties.

In oth­er words, while Coyle will now serve jail time, he was not found crim­in­ally re­spons­ible for any of his ac­tions against the res­id­ents of Kens­ing­ton and Port Rich­mond he de­ceived.

“It was really iron­ic that the banks were the vic­tims,” said Stefanie Seld­in, su­per­vising at­tor­ney at Phil­adelphia Vo­lun­teers for the In­di­gent Pro­gram . “I un­der­stand their po­s­i­tion, but it makes me al­most phys­ic­ally ill to think of the banks as vic­tims when they did ab­so­lutely no due di­li­gence on this. I be­lieve they were also com­pli­cit.”

Coyle’s at­tor­ney, Jef­frey Miller, told Star after Coyle pleaded guilty that the banks in ques­tion had pres­sured Coyle in­to ac­cept­ing loans and then failed to per­form due di­li­gence on the boxes of leases and rent rolls Coyle provided.

Coyle’s most com­mon scam was a fraud­u­lent rent-to-own agree­ment. Coyle would tell fam­il­ies that they could move in­to broken-down homes, many of which were aban­doned and some not even owned by Coyle, with a down pay­ment. Coyle told fam­il­ies that if they paid a monthly fee to Coyle and re­paired the homes, they would even­tu­ally come to own the homes.

“They thought they were buy­ing the Amer­ic­an dream,” said Mi­chael Hayes, an at­tor­ney with Mont­gomery Mc­Crack­en Walk­er & Rhoads, LLP, who has rep­res­en­ted five homeown­ers scammed by Coyle on a pro bono basis through VIP. “The folks who got vic­tim­ized, for many of them, Eng­lish is a second lan­guage. For them, the concept of run­ning a title search, or do­ing re­cords re­search on prop­er­ties, is for­eign.”

Jen­nifer Schultz, su­per­vising at­tor­ney at Com­munity Leg­al Ser­vices of Phil­adelphia, said she be­came aware of Coyle’s rampant fraud in 2009 after the prop­erty mar­ket col­lapsed and more than a hun­dred of his prop­er­ties went to the sher­iff’s sale.

Sud­denly, those homeown­ers who thought they were in rent-to-own agree­ments found that their agree­ments with Coyle were im­prop­er and that their pay­ments had not been cred­ited against fraud­u­lent mort­gages, massive li­ens for util­it­ies, un­paid tax bills and oth­er debts.

“Of about 150 people, only two told me they were only renters. Every­body else said they were be­lieved on the path to own­er­ship,” Schultz said. “They may not have had leg­al rights of own­er­ship but they all be­lieved that they were go­ing to own the houses.”

Today, the af­ter­math of Coyle’s scam is still felt in the River Wards.

“There are still ripples. This is not a re­solved mat­ter,” Schultz said. “Some of the houses that are still va­cant are known in the com­munity as Coyle prop­er­ties … People know no one’s watch­ing these prop­er­ties. So sec­ond­ary scam­mers have de­cided this would be a good way to make a quick buck, by selling these prop­er­ties to un­sus­pect­ing homeown­ers.”

Five such cases have come be­fore Schultz, she said. None of the vic­tims in those cases agreed to speak with Star.

However, there were some homeown­ers scammed by Coyle who even­tu­ally won the right to stay in the homes they paid for and re­paired. Pennsylvania state law re­cog­nizes “equit­able title.”

“It’s the law re­cog­niz­ing that even though some­body’s name may not be on the deed, they may have a real fair equit­able own­er­ship in­terest in the prop­erty,” Hayes ex­plained.

Hayes has won title for four fam­il­ies, he said. All of those fam­il­ies had doc­u­ment­a­tion of their rent-to-own agree­ments with Coyle. Homeown­ers who were duped by Coyle in­to ac­cept­ing verbal agree­ments have had a much harder time prov­ing their case, he said.

Schultz said that Com­munity Leg­al Ser­vices has won title for 20 fam­il­ies us­ing sim­il­ar leg­al ar­gu­ments. They are still in ne­go­ti­ation for an­oth­er 20 fam­il­ies seek­ing title, she said. But out of the group of 150 fam­il­ies Schultz en­countered that had been scammed by Coyle, the oth­er 110 have giv­en up and moved on, she said.

Re­port­er Sam Ne­w­house can be reached at 215-354-3124 or at sne­w­

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