You can see that they had a lawsuit against them in Florida for similar conduct but refused to pay.

It depends on the type of activities you conduct. for eg, sometimes the expenses are added to the basis of the property. 

Rather than wait for my clients to bring me a deal, I took a proactive approach to sourcing deals by leveraging my network of wholesalers, joining the Boardroom Mastermind and conducting my own marketing to go direct to seller.

They must approve the habitability of your rental before payments start.During the tenancy, section 8 also conducts annual inspections to make sure that habitability is maintained.  

My strategy is to conduct a sellers finance strategy where I incrementally pay them at 5% interest for 6 years (tentative) and then do a cash out refinance and pay them for the balloon payment.

Of course, this is not the best way to conduct business and I do not recommend it since it can greatly damage your reputation.

So, there's no reason to believe that wholesalers are better or worse than people in other professions, but it does mean that bad apples are able to stick around longer, and conduct themselves in ways that would get licensed agents' kicked out by their real estate commissions. 

I have represented many sellers where the buyers conduct all sorts of inspections on the house they want, in an effort to build a case for lowering the price.

Either way this whole case should be a learning lesson for agents on how to conduct their business better and establish a baseline on how they will get paid more efficiently so I don’t think it’s all bad.

In addition, please make sure that you conduct due diligence with whomever you hire.