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By PAUL FOY
AP Business Writer
SALT LAKE CITY (AP) -- One of the players behind the redevelopment of a defunct ski area in southern Utah was arraigned Monday on charges of securities fraud and racketeering for unrelated business deals.
Marc Jenson's partners insist he has no ownership interest in the former Elk Meadows ski area, which they plan to turn into an exclusive resort. They said Jenson remains in charge of attracting wealthy buyers to the Mt. Holly Club, a proposed gated ski resort community.
Jenson pleaded not guilty in 4th District Court, where his lawyers said they planned to challenge a judge's decision binding the businessman over for trial on six felony counts. The lawyers were given until March 8 to file the court papers.
It isn't Jenson's first brush with the law.
He spent six months in federal prison in 1992 for bank fraud and failure to file income tax returns, state prosecutors said. In addition, he is a target of several civil suits filed by private investors who say they lost money dealing with the 46-year-old Holladay man. Jenson filed for personal bankruptcy in 1990.
One of the securities charges involves Jenson's failure to tell investors of his checkered past and debts while raising millions of dollars for various deals, including an attempted takeover of the Mongoose bicycle division of Lake Forest, Ill.-based Brunswick Corp.
Prosecutor Charlene Barlow said Jenson was still raising money for the deal even after Brunswick sold Mongoose to Madison, Wisc.-based Pacific Cycle Inc., which calls itself North America's largest bicycle manufacturer and also owns the Schwinn brand.
Jenson, a principal of Nimbus Capital Partners, is in the business of supplying "hard-money" loans at high interest rates before business ventures can secure more conventional financing. He faces charges of misappropriating millions of dollars from two other Utah investors for so-called bridge loans.
"Marc is a very smart, successful businessman, but he's also a lender, and lenders aren't always the most popular people" when they call in a loan, said one of his defense lawyers, Rebecca Hyde. "There are a lot of people who think highly of him and, despite this problem, can continue to do business with him."
Count Mt. Holly Club principals among the believers.
"Marc is definitely helping as a marketing consultant," said Bill Quick, a public-relations executive for Mt. Holly Partners.
Jenson at one time had an ownership interest but lost it as the ski area slid into bankruptcy, according to other lenders, government officials and public documents. His stake in the operation Monday could not be independently verified, but Quick said his brother Stephen Jenson was one of three members of Mt. Holly Partners, the development group listed in a recent change on tax records as owner of the 1,400-acre Elk Meadows ski area.
The group also has snapped up private land around nearby Puffer Lake to add to the ski area, which sits inside a national forest in the shadow of 12,000-foot Mt. Holly, 18 miles east of Beaver in the Tushar mountain range.
They plan to expand the tiny ski area into a larger club with a Jack Nicklaus-commissioned golf course and other development totaling $3.5 billion -- seven times the total property value of rural Beaver County.
To join the club, buyers will have to pay a one-time $250,000 fee and dues of $10,000 a year plus millions of dollars for a mountain home.
Quick said Mt. Holly Partners also consisted of Craig Burton through his CPB Development, a neighbor of Jenson's Nimbus Capital Partners in Holladay, and New York investor Rob O'Neill through his Delaware corporation, MHU Holdings.
Jenson was in the picture several years ago when Nimbus offered a $3.6 million loan at 18 percent interest to Elk Meadows' former operator, Oregon businessman Wayne Case.
Case couldn't turn a profit, tried unsuccessfully to sell resort to a bigger outfit, filed for bankruptcy and finally gave up control. Nimbus foreclosed on the ski area, then had to sign over the deed to Litchfield Capital LLC, an Arizona investment firm that had provided Nimbus the $3.6 million for the loan.
Nimbus repaid the loan, plus interest, last year, Craig Campbell, one of two Phoenix lawyers who run Litchfield, said Monday.
Jenson didn't answer a message left Monday by The Associated Press, referring it to his lawyers and public-relations consultants. Case has refused for years to return calls and didn't return another message left on Monday.
(Copyright 2007 by The Associated Press. All Rights Reserved.)
