Equity Skimming scam

We go through this every few years, but with the recent increase in NOD's and people facing stressful home situations, it will raise it's head again. The following article was taken from the Division of Real Estate newsleter, August, 2007.

Mark Neusch and Michael Davis were sentenced in an equity skimming scheme. Neusch pled guilty to one count of equity skimming and one count of bankruptcy fraud. Davis pled guilty to one count of equity skimming

Neusch and Davis would research the Salt Lake City, Utah property records to find properties in various stages of foreclosure. They would then contact the homeowners who were experiencing difficulty making their loan payments and lead them to believe 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 with the lender and then share the profits with the homeowners. The homeowners would then quit claim their property to Neusch and Davis 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 month's rent and a security deposit. Neusch and Davis did not tell the renters that the properties were in foreclosure. Rather, they kept the rental income and security deposits for themselves and did not make the mortgage payments. The properties were foreclosed and the renters were evicted.

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

As a result of his plea, Neusch was sentenced to 18 months imprisionment, 36 months supervised release, and was ordered to pay restitution of $143,000. As a result of his plea, Davis was sentenced to 15 months imprisonment, 36 months supervised release, and was ordered to pay $143,000 restitution jointly and severally with Neusch and an additional $34,000 restitution for which he is individually liable.

Back from New Orleans..................ID theft

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Travelling made me think about ID theft, that is why I would like beriefly describe common ways of ID theft:

1. dumpster diving: they rammuage through your trash looking for bills or other paper with your personal information on it

2. skimming: they steal credit/debit card numbers by using a special storage device when processing your card

3. phishing: they pretend to be financial institutions or companies and send spam or pop-up messages to get you to reveal your personal information

4. changing your address: they divert your billing statement to another location by completing a "hange of address" form

5. "old-fashioned" stealing: they steal wallets and purses; mail, including bank and credit card statements; pre-approved credit offers; and new checks or tax information. They steal personnel records from their employers, or bribe employees who have access.