Smith brothers under fire

June 12, 2009
By

DAVID TABER

Officials began moving against two landlord brothers last month after it was revealed that one of them, Douglas Smith, is wanted for insurance fraud and arson.

The revelations cast light on what tenants and others have described as dismal conditions in many of the over 40 Jamaica Plain multi-unit rental properties owned by Roger and Douglas Smith.

In response to that, the city Inspectional Services Department (ISD) is stepping up inspections of properties owned by the Smiths. And state Rep. Jeffrey Sánchez has filed new legislation that would bar convicted arsonists and people with open warrants from receiving mortgages in Massachusetts.

In a written statement to the Gazette, Mayor Thomas Menino said, “All of Boston’s residents deserve a clean and safe place to live. ISD officials will continue to seek out landlords who do not follow the law and will continue to pursue every option available to make sure they understand their responsibilities as landlords in our city. The work done by our inspectors on the Smiths’ properties reflect their dedication to the residents of Boston.”

While each of the brothers names appear on deeds for JP rental properties, many of them are held in trust, meaning that multiple partners may not be listed on the deeds. Deeds for some of the properties being examined by the city in their look at the brothers’ holdings are held by Philip Tracy, a lawyer long-associated with the brothers, and some are held by an organization known as Arlington Finacial Properties Trust.

Menino also supports Sánchez’s legislation, Mayor’s Office spokesperson Christopher Loh told the Gazette.

Following up on a Gazette report from September, 2008, Fox 25 News last month reported that Douglas Smith is wanted in connection with an arson and insurance fraud case dating back to the late 1970s.

In 1979, Roger Smith and Douglas Smith were indicted for arson and insurance fraud in connection with a fire at a house the brothers owned at 4 Kenney St. In 1981 Roger Smith was convicted. He served 18 months for the crime, but Douglas Smith had disappeared before the trial.

In September 2008, the Gazette reported its discovery of an affidavit filed with the Suffolk County Registry of Deeds, signed by Doug-las Smith and notarized in Ireland. At that time the Gazette unsuccessfully sought confirmation from law enforcement officials that Doug-las Smith had been indicted on the arson and insurance fraud charges as well.

Fox 25 News uncovered that “a typical check of the state’s warrant system wouldn’t show that Douglas Smith is a wanted man. His origi-nal warrant issued on paper in 1981 was apparently never entered into the state’s electronic management system.”

Harry Pierre, a spokesperson from state Attorney General Martha Coakley’s office, confirmed to the Gazette that warrants for Douglas Smith’s arrest have been entered into the current system and are on file with the Suffolk County Clerk’s office.

Pierre said the AG’s Office would not comment on the case beyond a written statement from Coakley, saying, “As in any fugitive case, if we have specific knowledge of a person’s whereabouts, the Attorney General’s office has to assess how to best use its limited resources.”

The AG considers “public safety concerns, the individual’s criminal history, if any, and the viability of a criminal prosecution, including whether witnesses can be located and evidence still exists. Furthermore, extradition from a foreign country on a white collar criminal offense can be a very complicated and lengthy process,” the statement says.

Ralph Russo, who is identified as Douglas Smith’s lawyer in the Fox News report, did not respond to Gazette requests for comment. Previous Gazette attempts to contact Douglas Smith through lawyers whose names appear on documents he filed with the Suffolk County Registry of Deeds have been unsuccessful.

Two numbers the Gazette has for Roger Smith were both disconnected. Lawyer Vincent DiMento of Dimento & Sullivan, who in September told the Gazette his firm had previously represented the Smith brothers, did not return Gazette phone calls for this article. Calls to Tracy, a lawyer at DiMento & Sullivan long associated with the Smith brothers, also went unreturned.

While they may be keeping a low profile, the brothers have gotten the attention of local officials. Sánchez told the Gazette he last week “filed legislation that would prohibit convicted arsonists and individuals with open warrants from applying for mortgages from finan-cial institutions.”

Noting Fox News’s revelation that Douglas Smith was reportedly attempting to evict a tenant from one of his properties, Sánchez said Douglas Smith is “ignoring one court and utilizing one court [housing court] that benefits him. He won’t hold himself accountable to the system, but he is using the system to hold others accountable.”

Convicted of arson and insurance fraud, brother Roger Smith would also be affected under Sánchez’s bill.

Mortgages have played a huge role in the Smith brothers’ real estate transactions in recent years. As the Gazette reported in Septem-ber, foreclosure proceedings had commenced for 30 properties owned by the brothers and their associate Phillip Tracy.

A real estate lawyer with knowledge of the Smith brothers’ business told the Gazette at the time that it was unlikely any of the prop-erties be taken over by creditors. He said the volume of properties they own gives them significant collateral to continue taking out mortgages to pay off the old mortgages.

According to Suffolk County Registry of Deeds record, since last September, Roger Smith took out at least one more mortgage, in January 2009, for a property at 23 Burr St.

Last September, the Gazette also reported on alleged lax management practices by the brothers, including not providing working heating systems through the winter at some of the hundreds of units they own and strange rent collection practices.

At properties managed by Roger Smith, he or people claiming to represent him would often show up a few days before rent was due and offer discounts if tenants would pay in cash, tenants the Gazette spoke to at the time said.

The tenants, who asked to remain anonymous when discussing their landlord, said they sometimes performed repairs themselves and deducted the costs from the rent. They said the Smiths-owned properties were probably the only ones they could afford in the neighborhood.

Officials from the city Inspectional Services Department recently made preliminary inspections of 35 Smith-owned properties, ISD spokesperson Lisa Timberlake told the Gazette.

According to information provided by ISD, “common area violations”—housing code violations observable without entering the units, were found at nine of the properties. In an e-mail dated June 9, ISD Assistant Commissioner Dion Irish said, “We will leaflet the properties tomorrow [June 10] to inform residents who would like a [full] inspection to contact us.”

The ISD documents list 44 properties in association with their investigations of the Smiths’ upkeep practices. According to those documents, 17 of the deeds for those properties are held by Roger Smith and nine are held by Douglas Smith. Fifteen are held by the Philip A. Tracy Jr. Trust. Three others are held by Arlington Financial Property Trust. In September a property manager for some Smith owned properties the Gazette spoke identified himself as an employee of Arlington Financial Properties.