Blaine Murphy asks to let out of prison

Cleveland city councilman Tony Brancatelli walks past convicted house-flipper Blaine Murphy at a hearing before Judge Richard McMonagle on his request to be let out of prison early on Friday, January 17, 2014. Murphy was granted the request, but with conditions that caused him to change his mind about the release. The judge, however, held him to the plea agreement, so he will be released. He will be subject to the supervision and approval of the councilman in many respects. (Thomas Ondrey/The Plain Dealer)

(Thomas Ondrey Thomas Ondrey)

CLEVELAND, Ohio – A Florida man sentenced in May to prison for illegally flipping dilapidated homes asked for and was granted an early release from prison Friday.

But after hearing Cuyahoga County Common Pleas Court Judge Richard McMonagle's list of rules and requirements, Blaine Murphy respectfully asked to be returned to prison. McMonagle, however, released Murphy to serve the remainder of his 18-month prison term from a fixed-up home he owns on Beyerle Road in the city's Slavic Village neighborhood.

According to prosecutors, Murphy's crimes involved buying hundreds of rundown homes sight-unseen from banks. Then, instead of fixing them up, he would sell, or "flip," them to another buyer at a profit.



In doing so, he would ignore code violations and fail to pay taxes. The homes would often sit vacant, costing the city money, contributing to neighborhood decay and acting as magnets for crime.

Prosecutors say Murphy's crimes occurred in multiple states between 2005-10 and included the quick sale of 235 homes in Cleveland and other Cuyahoga County suburbs.

McMonagle doled out a two-year sentence in May after Murphy had pleaded guilty to charges of fraud and tampering with records.



McMonagle ordered Murphy to finish paying $250,000 in fines and restitution as well as an additional $36,000 he owes to the city housing court. He has already paid about $750,000 of his original fines and restitution of more than a million dollars and rehabilitated or torn down at least 13 homes he owns, according to his attorneys.

Murphy, 45, must do 3,000 hours of community service – basically full-time work for 18 months -- in Slavic Village, including helping with run-down properties, building new ones for the poor and planting and tending to at least five community gardens, McMonagle said.

For the first six months the court will electronically monitor him.

"I think someone with your talent ought to be able to contribute to this community," McMonagle said.

The judge also rejected a request by Murphy -- known locally as Bryce Peters, a name he used when purchasing Cleveland homes, -- to return to Naples, Fla., intermittently to conduct business and get his affairs in order.

Murphy said he was flabbergasted at the list of payments and requirements and said he would rather return to tutoring inmates in prison because he was unsure he could live up to the judge's order. He said he needed to be able to work to fulfill some of the obligations.

Defense attorney Larry Zukerman argued strongly against the judge's requirement that Cleveland Councilman Tony Brancatelli act as his client's "de facto" probation officer.

"How could you make someone's biggest enemy ... be the person with the key to his freedom?" Zukerman said. Murphy still has a 10-year prison term hanging over his head should he violate his probation.

"(Brancatelli) has made it his life's mission to send my client to prison," Zukerman said, saying Brancatelli has called Murphy a "scourge of the earth." "It's a recipe for disaster."

Zukerman said Murphy has abided by every order of both the common pleas and housing court and paid the city back more money than any bank ever had.

"We'll see the character of everyone involved here," McMonagle said, ordering Murphy released.

During the hearing, Brancatelli asked that Murphy use his "industrious nature" to better the community his crimes damaged. Afterward, he said he would find a way to work with Murphy.

"My responsibility is to the community," he said. "We'd rather have him out doing the work."

Brancatelli said he wouldn't be looking for ways for Murphy to fail.

Most likely, Murphy would be working under volunteers and Slavic Village community development employees who oversee many people doing community service.

After the hearing, Zukerman said he would work with Brancatelli to outline expectations for his client.

Zukerman had proposed a different type of community service for Murphy, asking that he be able to work with the Cuyahoga County Land Bank, specifically with a program that helps veterans find affordable housing. Murphy also told McMonagle he was interested in starting a foundation to work with reputable non-profits to focus their charitable giving toward housing, literacy and drug addiction issues.

He said he learned about the drug and literacy issues during the time he was in prison, when he tutored inmates trying to learn to read and obtain high school equivalency certificates.

Assistant Cuyahoga County Prosecutor Greg Mussman pointed out the lasting community damage but said the county didn't oppose Murphy's release so long as he remained in Cleveland for the remainder of his sentence.

In a release after the hearing, Mussman said "You saw the real Blaine Murphy in there. "He would rather go back to prison than live and work in the neighborhood where he did so much damage."

Frank Ford, who serves as chair of the Vacant and Abandoned Property Action Council (VAPAC), said that damage caused by the more-than 300 properties Murphy touched is ongoing. He said some of his properties appear to be vacant and back taxes are owed on some of them.