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Review or Audit the Books – always do one of these………

/ Owner - March 20, 2024

…..because if money disappears while you’re on the board, you might as well move, as your neighbors will blame you just as much as the crook.

Over the last month or so, we’ve seen another boost in cases of  fraud and embezzlements in HOA’s and condo’s. I imagine this occurs after the beginning of the year because most associations get their audit or financial review at the end of the fiscal/calendar year.  Whereas the instances of crime have appeared are mostly in associations that haven’t had an independent audit for some time.

  • A Scottsdale, AZ manager stole $1.6 million from the association, which had failed to do a background check
  • A city alderman who was also on the association board, embeled $220,000 from a Missouri association
  • The owners of management co., who allegedly stole millions from dozens of Southwest Florida community associations, have been indicted by a federal grand jury.
  • An employee of a California management company stole nearly $1 million from various association accounts
  • A Florida HOA manager stole $25,000 from the associaiton she managed
  • Anther Florida manager stole nearly $200,000 from the association she managed
  • Another Florida association fired a woman as their manager, then her mother became board President, rehired her and with the daughter and her boyfriend, defrauded the association of $42,000

(See the full list here)

A really good article about how an association should establish policies and protocols to avoid this comes from Silvercreek Association Management: Navigating the Shadows: HOA Fraud and Community Safety

There are addition articles in the “Fraud & Embezzlement” category (use the drop-down menu in the right column).

I would like to add one more item to the area of prevention.  At least two non-related people should receive or be allowed to access original bank statements.  In order to commit the crimes, each of the embezzlers had to create fake bank statements, which is very easy in the computer age. Don’t make it easy for them.

This last batch of crooks has more managers than usual.  Over the years, even more board President’s and Treasurer’s have absconded with the money.



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