Mark Neusch and Michael Davis were indicted in the federal court for the Central District of Utah in connection with an equity skimming scheme. Neusch was charged with one count of equity skimming and three counts of bankruptcy fraud. Davis was charged with one count of equity skimming and one count of bankruptcy fraud.

According to the indictment, the defendants engaged in a scheme whereby they acquired numerous residential properties by making misrepresentations to property owners to induce them to sign over title to the defendants. They then rented the homes to uninformed third parties and converted receipts and security deposits paid by renters to their own use while allowing the mortgages on the property to go into default or remain in default and eventually go to foreclosure.

The defendants would research the Salt Lake property records to find properties in various stages of foreclosure. They would then contact the homeowners who were experiencing difficulty making their loan payments. They would lead homeowners to believe that their homes would be saved from foreclosure and they would be able to maintain their credit. They represented they would make the mortgage payments, and rent or sell the properties by negotiating short sales and then sharing the profits with homeowners. The homeowners would then quitclaim their property to the defendant who either lived in the properties or, more commonly, advertised the properties for rent with Rental Express (a local residential rental company.)

Renters would be required to pay a first and last months rent and a security deposit. In many instance, the defendants did not tell the renters that the properties were in foreclosure. Defendants kept the rental income and security deposits and did not make the mortgage payments. The properties were foreclosed and the renters were evicted.

The defendants acquired title to approximately 14 properties, allowing the mortgages to go into default while the defendants collected rental income and deposits.

In order to avoid foreclosure on some of the properties, the defendants would transfer them to various entities and file voluntary bankruptcy petitions. The bankruptcies would cause the foreclosure proceedings to be delayed or stayed. Entities that took title the properties, according to the indictment, included: M&M Properties, Reliable Properties and DBK Properties

Properties identified in the indictment as subject to the scheme include:

6529 South Purple Sage Drive, West Jordan, Utah

4112 South King Arthur Drive, West Valley City, Utah

3764 Stable Bay, Magna, Utah

3746 South Dunn Court, Magna, Utah

6370 South Wakefield Way, West Valley, Utah

5132 Milstead Lane, Salt Lake City, Utah

7689 West Blue Ribbon Bay, Magna, Utah

3708 Brook Hollow Court, West Valley City, Utah

4705 West Harmon, West Valley City, Utah

7654 South Sunrise Place East, West Jordan, Utah

7328 West Adams Road, Magna, Utah

3412 South 7895 West, Magna, Utah

8041 West Country West Drive, Magna, Utah

7460 West 3500 South, Magna, Utah

3876 South Ditsie Drive, Magna, Utah