Tread softly, sounds like he's not yet convicted of the most recent activity.This applicant would lose points in my screening due to having multiple criminal events and for the most recent being so recent.Additional occupants rather than new applicants are a different animal. 

Additionally without permits you will hit a wall if you try to sell some day.Do not leave it to a lazy contractor, apply for the permits as the home owner.Any contractor that advises not to apply for proper permits is unscrupulous and verging on criminal in nature.

Despite the rental history, I know my friend wouldn't be one that buy and hold investors would jump through hoops to rent to: he's tattooed up, has a criminal record,  and no proof of income (likely no evictions though!

It is probably cheaper than joining the apartment association and they would have the means to qualify a new tenant (credit, criminal, rental history, income) and ensure that the tenants are signing a lease that follows the laws in CA. 

Now the amount of properties available are slim, but not sure how ready they are going to be to fight/prosecute you... for having a discounted rent option for "Good Neighbors Next Door"Good Luck on whatever you do!

We should never allow criminals to get off scott free.

sure thing.your developer/buyer/builder is going to need to pay out side consultants to prosecute the subdivision plat.. this may include among other things the following depending on jurisdiction:survey workengineering worksoil  testinggeo tech reports.city and state applicationsetc etc.. you want it in your contract that when this developer pays for these items.. that they are also your property.. in other words if he does not follow through he hands them over to you.. because these items are the property of who ever hired the consultant you have to specify in your contract that the buyer if they don't go through with the deal will hand this stuff over to you.this will help U resell if needed or prosecute the map your self without having to pay for these things all over again.

Credit check revealed excellent credit scores, but also an incredibly high debt-income ratio; otherwise, no delinquencies or criminal background.

The criminals get inside computer systems and send real emails with real info but wrong instructions.

you will not be able to get any criminal background on a minor so a background check is pointless.