I get it, its like someone getting arrested and say to the cop or judge " I didn't do it" I am sure they hear this from guilty people on a daily basis.

If he is a licensed agent then file a claim against him that way.If he was selling a property that he did own (he was not just a 'middleman') then he should be ale to sign a corrective deed or is potentially guilty of fraud.Hope it works out for you.

My friends had nothing to do with the rampage, but they were guilty by association (in the eyes of the landlord).

I have been guilty of this in the past also.

Gave them a curt no on their application and they proceeded to argue and plead through multiple conversations that they should be rented to.

If you like cars and want to feel less guilty, find cars that will be worth more later, and find them cheap.  

Even if I were sued, I document everything and obey the law, so I won't be found guilty.

I was guilty of that and it didn't help.

What happened to innocent until proven guilty?  

I tried not to laugh at them over the phone, but I failed.That is no way to build trust with a Seller, unless the Seller is mentally incompetent, in which case you would be guilty of fraud.