Prosecutor: Man Indicted for Illegally Flipping 235 Houses

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CLEVELAND, Ohio— Wednesday was a day to celebrate the hard work of Cuyahoga County's Mortgage Fraud Task Force.

Prosecutor Bill Mason called a press conference to announce a 16-count indictment against 43-year-old Blaine Murphy from Naples, Florida.

Murphy is charged with illegally flipping 235 homes in Cuyahoga County, 186 of them in the city of Cleveland.

"Murphy is an example of a germ that multiplies exponentially on spoiled food," said Mason.

The prosecutor told a room full of reporters that Murphy hid behind phony names like Bryce Peters, III and Martin J. Franks while forging deeds and other documents related to properties in 14 Ohio counties, Michigan, Pennsylvania, Missouri, and Texas.

"Cuyahoga County has brought justice to the real estate predator who is responsible for causing millions of dollars in damage," said Mason.

The prosecutor said Murphy's use of fictitious names made him nearly impossible to find until Special Agent Stacy Gwin, from the Cleveland office of the FBI, tracked him down. Murphy was arrested the Friday before Christmas at his million dollar home in a golf course community in Naples. Authorities said Murphy kept a boat and a plane nearby.

"In total, 96 of the properties he laid his hands on fell into tax foreclosure for a total delinquency of $1 million," said Mason.

The prosecutor said Murphy purchased properties in bulk from sub-prime lenders looking to unload bad investments at bargain basement prices.

Cleveland Councilman Tony Brancatelli said the Slavic Village neighborhood (in his ward), had been ravaged by crimes of which Murphy is accused.

"No question we are all impacted by this, it's not just an urban issue, it's across the entire United States that we're starting to see property values drop because of these types of predatory and fraudulent activities that have occurred," said Brancatelli.

Cleveland Housing Court Judge Ray Pianka tried unsuccessfully to hold Murphy accountable for the neglect of his properties. Murphy and his company, Bryce Peters Financial Corporation, had been held in contempt 53 times for failure to show. Fines totaling $9.5 million were also levied against them.

"Today is a Triumph of justice over greed," said a smiling Mason on Wednesday.

Murphy is expected to make his first appearance in an Ohio courtroom on January 10, 2012.