A $2.1M Embezzlement Case Raises Critical Questions About Property Management Trust

December 17, 2025

A Cedar City property manager's 25-month prison sentence this week is sending shockwaves through Utah's rental property community—from Iron County to Salt Lake City to Provo. Blake Floyd Cozzens' $2.1 million fraud scheme serves as a stark reminder for every Utah County and Salt Lake County property owner: choosing the right property management company isn't just about convenience—it's about protecting your investment from devastating fraud.

While this particular case happened in Southern Utah, property owners throughout the Wasatch Front should pay attention. The warning signs, red flags, and protective measures apply whether you own rental properties in Murray, Sandy, West Jordan, Provo, Orem, or anywhere along the I-15 corridor.

Blake Floyd Cozzens, 36, didn't just fail his clients in Cedar City. He systematically defrauded them of over $2.1 million to fuel a gambling addiction that extended to Las Vegas casinos, betraying the trust of homeowners' associations, individual property owners, and tenants. His case highlights vulnerabilities in property management oversight that exist throughout Utah—including the heavily populated Salt Lake and Utah County markets where thousands of rental properties are managed by third parties.

How the Fraud Unfolded

According to the U.S. Attorney's office, Cozzens exploited his position in multiple ways over five years:

The HOA Embezzlement: Between January 2020 and January 2025, Cozzens siphoned $586,300 from homeowners' association funds that were supposed to be safeguarded for property maintenance and management. Instead of protecting these community funds, he funneled the money into his personal accounts.

The Software Scheme: He didn't stop at stealing cash. Cozzens manipulated an online property management system by submitting fraudulent deposits, stealing another $210,000 through fake transactions.

The Casino Check Scam: In Las Vegas, Cozzens took fraud to another level. He obtained seven cashier's checks totaling $1.4 million, exchanged them for casino markers, then falsely reported to the bank that he'd lost the checks. When the bank stopped payment to the casinos, they absorbed nearly $1.4 million in losses.

The Devastating Impact on Utah Property Owners

U.S. Attorney Melissa Holyoak captured the broader significance: "As homeowners struggle with affordability, the last thing they need to worry about is that their hard-earned money paid to HOAs will be stolen from those entrusted to serve them."

This resonates particularly in Salt Lake and Utah Counties, where property values have surged in recent years. According to recent data, the median home price in Salt Lake County is approximately $560,000, with Utah County close behind. Many property owners along the Wasatch Front have turned to rental property investments as housing demand remains strong—making professional property management increasingly common.

This wasn't victimless crime. Real people—families managing rental properties in Draper and Lehi, retirees depending on HOA reserves in Sandy and Orem, tenants in West Valley City and Provo paying security deposits—lost money they could not afford to lose.

Red Flags Property Owners Should Watch For

While most property managers are honest professionals, the Cozzens case highlights critical warning signs every property owner should monitor:

1. Lack of Financial Transparency

• Are you getting detailed monthly statements?
• Can you access your account information 24/7?
• Are reserve funds held in separate, transparent accounts?

2. No Third-Party Oversight

• Does the company use external accounting firms?
• Are financial audits conducted regularly?
• Is there separation of duties between who handles money and who approves expenses?

3. Vague or Delayed Responses About Money

• Do financial questions get clear, immediate answers?
• Are expense reports detailed or suspiciously general?
• Does the manager seem evasive about where funds are held?

4. Missing Documentation

• Are all transactions properly documented?
• Do you receive copies of vendor invoices?
• Can you verify that HOA or rent payments match bank deposits?

5. Unusual Financial Patterns

• Are there unexplained drops in reserve funds?
• Do expense categories show sudden, dramatic increases?
• Are there frequent "emergency" assessments that don't align with property needs?

Protecting Your Investment: What to Ask Before Hiring

The best defense against property management fraud is asking the right questions upfront:

Financial Safeguards:

• "Where are client funds held, and who has access?"
• "What separation of duties exists in your accounting department?"
• "How often are accounts audited by external firms?"
• "Do you carry errors and omissions insurance? What's the coverage amount?"

Transparency & Access:

• "How can I access real-time financial information?"
• "What financial reports do I receive and how often?"
• "Can I request an audit of my account at any time?"

Track Record:

• "How long has your company been in business?"
• "Can you provide references from current clients?"
• "Are you members of professional associations like NARPM?"
• "Have you ever had any regulatory actions or legal issues?"

Why Local, Owner-Operated Companies in Salt Lake & Utah Counties Often Offer Better Protection

Large property management firms managing properties from Ogden to St. George can create environments where fraud goes undetected longer. When you're one of 500+ properties spread across multiple markets:

• Individual account anomalies are easier to hide in volume
• You're less likely to have direct contact with decision-makers
• Staff turnover means less accountability and institutional knowledge
• Regional managers may not know the nuances of your specific neighborhood—whether it's the rental market in Sugar House versus West Jordan, or condo regulations in Provo versus Orem

Salt Lake County and Utah County landlords benefit from smaller, locally-owned property management companies that:

• Know the local market intimately: Understanding everything from Sugar House rental demand to Lehi's tech-driven population growth to Provo's student housing dynamics
• Direct accountability: Owners have their reputation on the line in their own community
• Personal relationships: You know exactly who manages your money
• Manageable portfolios: Each property gets meaningful attention, whether it's in Millcreek, American Fork, or Herriman
• Local investment: Owner-operators often own properties themselves in Salt Lake and Utah Counties—they understand your concerns firsthand

The Importance of Professional Standards in Utah

Utah requires property managers to hold a real estate broker's license to legally manage properties for others. This is an important safeguard, but the Cozzens case shows that licensing alone isn't enough protection.

Reputable property managers serving Salt Lake and Utah Counties demonstrate their commitment through:

• Valid Utah Real Estate Broker License: Verify any property manager's license at Utah Division of Real Estate
• NARPM Membership: National Association of Residential Property Managers requires continuing education and ethical standards
• Bonding and Insurance: Protects owners if employee theft or fraud occurs
• Separate Trust Accounts: Client funds never mix with operating funds—a legal requirement in Utah
• Regular Audits: Third-party verification of financial practices
• Local Professional Networks: Established relationships with Utah County and Salt Lake County vendors, attorneys, and contractors

Important Note for Utah Landlords: Under Utah law (Utah Code § 61-2f-301), anyone convicted of felonies in the last five years or misdemeanors involving fraud, theft, or dishonesty in the last three years is disqualified from holding a real estate license. Check your property manager's license status and history.

Moving Forward: What Property Owners Should Do Now

If you currently use a property management company:

1. Review your last 12 months of statements - Look for unexplained expenses or gaps
2. Verify your property's reserve balance - Confirm funds match what statements show
3. Ask about financial safeguards - Request information about audits and account security
4. Meet with your property manager - Gauge their transparency and responsiveness
5. Consider an independent audit - If anything seems off, hire an external accountant

The Silver Lining

While the Cozzens case is disturbing, it's also a reminder that law enforcement takes property management fraud seriously. The U.S. Postal Inspection Service, FBI, and local authorities worked together to bring him to justice.

As Glen Henderson, Inspector in Charge of the Phoenix Division, stated: "When individuals in trusted roles commit financial crimes, they harm the very communities they are meant to serve."

The 25-month sentence, four years of supervised release, and $2.1 million in restitution send a clear message: property management fraud has serious consequences.

Your Investment Deserves Protection

Whether you own rental properties in downtown Salt Lake City's urban core, the family neighborhoods of South Jordan and Riverton, the tech corridor of Lehi and Pleasant Grove, or the college towns of Provo and Orem, property management should give you peace of mind—not sleepless nights wondering if your money is safe.

While fraud can happen anywhere, Salt Lake County and Utah County property owners who stay informed, ask hard questions, and choose transparent, accountable property managers dramatically reduce their risk.

The Cozzens case is an extreme example, but it illustrates a fundamental truth: trust is everything in property management. Before you hand over the keys to your Wasatch Front investment property, make sure you're also handing over access to someone who has earned—and will maintain—your trust.

Resources for Utah Property Owners

• Verify Property Manager Licenses: Utah Division of Real Estate Licensee Lookup
• File a Complaint: Utah Division of Real Estate Complaint Form
• Salt Lake County Property Watch: Free alerts for any documents recorded against your property

Looking for trustworthy property management in Salt Lake or Utah County? Ask yourself: Does your current property manager give you direct access to their cell phone? Do you get detailed financial reports every month? Can you verify your account balance anytime you want? Is their Utah broker license active and verified?

If you answered "no" to any of these questions, it might be time for a conversation about what real transparency looks like in the Salt Lake and Utah County property management market.

The information in this article is based on public court records and reporting from the U.S. Attorney's Office for the District of Utah. Property owners in Salt Lake County, Utah County, and throughout the Wasatch Front should use this case as an opportunity to review their property management relationships and ensure proper safeguards are in place.

Source: Department of Justice Press Release - Cedar City Property Manager Sentenced