A prominent San Francisco real estate broker could lose his license after the NBC Bay Area Investigative Unit uncovered what his investors call a decade of deception. The broker attracted more than a dozen investors to false promises of profit from prime real estate in a historic San Francisco neighborhood.
State and Investors Accuse San Francisco Broker of Fraud
Nearly a dozen angry investors tell the NBC Bay Area Investigative Unit the prominent broker took their money, hid records, took secret commissions and has avoided any public accountability.
By Tony Kovaleski and David Paredes
Nearly a dozen angry investors tell the NBC Bay Area Investigative Unit a prominent broker, W.B. Coyle, took their money, hid records, took secret commissions and has avoided any public accountability. This story first aired May 22, 2013 at 11 p.m. Tony Kovaleski reports. (Above is an image of Kovaleski knocking on Coyle's door for an interview.)
Wednesday, Jul 17, 2013 Updated at 10:05 PM PDT
John Sollner is a former Marine pilot and currently flies for a commercial airline.
“I gave him a half million dollars. My life savings at the time,” Sollner said.
He and others, including Scott Jacques, invested in a Presidio Heights multi-unit building.
“This has literally destroyed my family,” Jacques said, adding that the deal caused him financial ruin. At the time of his investment, he was a first time homebuyer. “This was my dream.”
Investors like Sollner and Jacques have filed more than 20 lawsuits after experiencing more than a decade of financial frustrations where they accuse San Francisco real estate broker W.B. Coyle of diverting funds, failing to provide financial records and real estate fraud. According to California Bureau of Real Estate records, Coyle is the designated officer of Telegraph Hill Properties, Inc.
Coyle’s pattern of operation was complicated and differed from investment to investment.
In legal filings, Coyle denied any wrongdoing and has also responded with countersuits against the investors. He also declined requests to speak on camera with NBC Bay Area’s Investigative Unit.
Documents certified by the San Francisco Office of the Recorder-Assessor, show Coyle has recieved multiple notices of default or foreclosure.
“I believe he embezzled more than $200,000 from us,” said investor Ralph VonderHaar. Another of the investors, Elizabeth Klein said, “It is just horrible the level of damage that he has caused is incredible and nothing is being done.”
The civil lawsuits and legal filings involve more than two dozen properties in San Francisco and more than $15 million spanning nearly a decade. The investors have sought relief from the courts, from the state of California, the FBI and from local San Francisco law enforcement. To date, the investors have found no satisfaction in any form of accountability from Coyle.
“It’s unbelievable that someone can just steal my money,” said investor Aaron Ferguson. “And who do I turn to? No one can do anything about this. It’s ridiculous.”
Coyle’s investors want him to be held accountable for the burden of legal fees, holding some property captive in court filings, and most of all, their nearly $15 million – collectively - returned. They claim Coyle has made that nearly impossible by denying access to records and avoiding the service of legal documents with surveillance cameras pointing in every direction at the front and back of his real estate office.
The investors claim Coyle’s reluctance to settle the matter led to a court-ordered arbitration by an independent judge. The arbitrators were hired to resolve some of the cases and return their decisions to San Francisco Superior Court. Investors said Coyle rarely appeared at the mandatory hearings. But in November 2012 at a hearing in Walnut Creek, the Investigative Unit waited outside the arbitrator’s office for the opportunity to question Coyle. When he saw the camera, he quickly closed the door he was exiting and ran off. A separate camera captured Coyle quickly getting into a car driven by his attorney.
In January, the Investigative Unit waited outside yet another mandatory hearing in San Francisco. Coyle was a no show.
After more than a year of investigating complaints filed by investors and inquiries from the NBC Bay Area Investigative Unit, the California Bureau of Real Estate has filed a five-part accusation against Telegraph Hill Properties and Coyle.
Tom Poole is the Bureau of Real Estate’s Acting Chief of Enforcement. “It’s about as serious as it gets,” Poole said. “The accusation speaks for itself.”
The state Bureau of Real Estate will try to prove that Coyle committed fraud or dishonest dealing, misrepresentation, failing to provide records, commingling funds and taking secret commissions.
“Based on the accusation, do you think that there is enough evidence to revoke his license?” asked NBC Bay Area Chief Investigative Reporter Tony Kovaleski. Poole said, “Yes, we do.”
NBC Bay Area interviewed Sam Kiamanesh, an attorney and professor of real estate law and investments at DeAnza College in Cupertino. Kiamanesh reviewed the filings against Coyle at the request of the Investigative Unit.
“I have never seen a broker with so many violations over so many investment properties with so many different investors. It seems like a pattern with Mr. Coyle,” Kiamanesh said. “He is basically at every turn making sure he gets taken care of first. Whether it is getting paid the commissions on a transaction, or taking a position that was adverse to his clients,” Kiamanesh added. “My take is he (Coyle) is in a lot of hot water. He’s been accused of breaking every rule in the book basically,” Kiamanesh said.
In addition, the independent arbitrator has issued a decision in favor of Sollner, Jacques and three others in just one of the ongoing lawsuits. They were awarded $1.1 million including cash, plus the sale of two properties.
A San Francisco Superior Court judge was scheduled to rule - and investors believe - he was likely to confirm the arbitrator’s decision on April 30. Coyle declared bankruptcy on April 29, which again stalled the finality of the matter.
After avoiding an interview with NBC Bay Area and not appearing at mandatory hearings, the Investigative Unit went to Coyle’s real estate office in San Francisco’s North Beach neighborhood. From the street, the NBC Bay Area’s investigative team saw him in his third-floor office and requested an interview through the downstairs intercom. The request was captured on multiple surveillance cameras outside his office. Still, he never answered.
Coyle followed with an email and wrote, “My offer to speak with you still stands.” The offer was accepted. However, Coyle never replied when asked to schedule a time to meet and speak with NBC Bay Area.
But Coyle still has to face the accusations against him from the Bureau of Real Estate. And with all the lawsuits, countersuits, bankruptcies and investigations that could go on for months - if not years - Kiamanesh summed up his assessment of Coyle’s business practices, “I don't think he ever thought he would be caught.”