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 firstname.lastname@example.org.