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Our corrupt HOA board of directors are committing fraud

Posted on Fri, Jan 31, 2014 @ 08:22 AM
In Oct. 2011, I discovered a criminal syndicate seized control of our Napa, CA condo HOA in 1993. The scheme went unnoticed for 20 years. During the past 30 months, I audited 20 years of HOA papers and financial reports, filed 2 police reports - which are ignored by all local, state and federal law enforcement. Even our County Supervisors, 2 California legislators and a US Congressman look the other way. This situation is very similar to the Las Vegas, NV case (posted at www.usdoj.gov on June 1, 2012). The Napa ringleader is our HOA's "trusted" lawyer since 1983, who with inside connection to the County Recorders Office, drafted and recorded fraudulent CC&Rs in 1998. Included in the filing is the forged signature of a former HOA president, who is claimed to be the DECLARANT of the Restated (e.g., totally replaced) CC&Rs. This person last served on the board in 1989, then moved away for health reasons, and passed away in April, 2000. (Conspirators also claim this person was on hand at the June, 2002 Annual Meeting, and counted the votes.) I forwarded copy of the forged papers and death certificate to law enforcement, but they refuse to acknowledge or speak to them. The California Attorney General's office, however, recommend I take this to the media. I've gone to the local media, but they refuse to speak with me. Seems suspicious to me. Upon realizing law enforcement will not intervene, I sent an e-mail to 17 allied Owners describing 4 criminal frauds I had documented. 6 weeks later, the conspirators sued me for libel. Unable to hire a lawyer, I represented myself at the Mandatory Settlement Conference, where I presented solid evidence to support my allegations. The next day, the libel suit was dismissed - but the conspirators confidently continue, painting me as a trouble maker. In October, 2013, an Oakland, CA based law office, dealing in housing and economic rights, sent a postcard invitation to attend their workshop, which is sponsored by the Napa District Attorney. I signed up (thinking the DA was behind the invitation) and sent a summary of my situation. The lawyer asked to review papers, which I forwarded. The lawyer concluded, "...the offenses seem to be a criminal matter". I forwarded those papers to our District Attorney, and they refuse to acknowledge or speak to the evaluation. I've done my best to make waves and be the squeaky wheel, but I find these officials are linked arm-in-arm, and determined to keep me from exposing these crimes. Consequently, I am in fear of retaliation by the conspirators, law enforcement and local officials. I don't leave my home for fear of a break-in and loss of my evidence. I need solid advice, or a coach, to help us navigate this mess. I don't know where to turn next or how to end this. I'm 66, the stress is killing me, and my financial resources are spent. I can't run away. In December, 2013, I prepared a petition to call for a Special Meeting and 10 Homeowners signed on. The Special Meeting is set for March 5, 2014 and, on the agenda, are these fraud issues and merits of the lawsuits filed against me. Thank you for any comment and suggestion. 



First of all, BRAVO! Unfortunately that was all I have on this.  
You have done EVERYTHING you possibly could do right down to police work, proof of fraud, and doing due diligence in the accusations. It will be very interesting to see what answers you get. Certainly no one can give the pat answer"read you documents".  
I do want to wish you good luck though. Wish you were on my team!

posted @ Friday, January 31, 2014 8:51 AM by Another Voice

Good luck to you - This is a serious problem that for some reason (campaign contributions??) lawmakers refuse to address. The failure of the media is unconscionable.

posted @ Friday, January 31, 2014 9:01 AM by annon

There are always two sides to the story and apparently both sides have presented there positions in some sort of informal hearing. That said, you have not explained what impact the CCR changes had, especially in light of the fact they were changed 20 years ago? I presume you were not an owner at that time, so how did this alleged "fraud" come to your attention? What damages are you alleging?

posted @ Friday, January 31, 2014 9:04 AM by Bill W

three little letters: FBI 
We currently have this happening here in our condo in Florida. Walk into your local office and hand it over, and then let them worry about it. We are making progress here and at no more expense to the rest of us who have been being robbed blind for the past 15 years. Good luck and please go there, you will sleep better.

posted @ Friday, January 31, 2014 9:06 AM by CarlJ

I do not mean to belittle your question but what damages have you and/or the condo suffered that started all this? "Conspirators"? "Criminal Syndicate"? "Crimes?" Everyone ignores you including law enforcement, local officials, the county recorders office, local media, the lawyer, the county supervisor, California legislators, your US congressman and I assume your board of directors. Seems to me like you have no case. Why are you pursuing this if absolutely no one will listen to you? I don't think anyone can respond intelligently.

posted @ Friday, January 31, 2014 9:09 AM by R ME

Until you've lived through a situation like this, do not belittle anyone and say they cannot respond intelligently. This is occurring all over the country, and mainly in south Florida. Nobody listens because they dont know HOW to listen, they want to help but they can't because there are very few laws in place to cover these situations. The state representatives are working diligently with law enforcement at every level to close up loopholes and protect condo owners from thieving property managers. This should be a wake up call to every condo owner on the planet - get involved, asked questions, request copies of financial reports, attend board meetings and stop sticking your head in the sand letting everyone else worry about it.

posted @ Friday, January 31, 2014 9:37 AM by CarlJ

No one on this blog is in position of past judgment, because we only get one side of the story. It seems to me that both questions and answer should be directed to specific issues, policies, procedures, experience and based on specific facts, not accusations. Opinions and venting are useless information.

posted @ Friday, January 31, 2014 10:25 AM by Bill W

Carl... Meant to say I don't think anyone can respond to the original question without knowing what damages occurred. If no damages, no case. I hope you did not mean that all property managers are thieves and I do not believe that the kind of things described in the original question are occurring all over the country. Been a board member as well as treasurer and secretary at different times for years and am certain I am not sticking my head in the sand yet agree that most condo owners just want to be left alone as promised by "thieving realtors" who do not prep potential owners for condominium living (luckily where I live state law requires boards of directors and realtors to do so).

posted @ Friday, January 31, 2014 10:26 AM by R ME

Nobo is highly interested in the details of this post because Nobo has posted on this forum ,  
and experienced a very similar situation. 
Nobo wants to know if the fraud and conspiracy involves just providing false information about the board members or is there actually any evidence of monies being diverted fraudulently? 
In Nobo's case, Nobo has solid evidence of false documents being presented, false names admitted as members of the board of the "Master Association". Nobo pays 7 dollars per month to this master association as his sub-association pays part of his monthly assessment to the master association. Nobo has been refused access to any records of where this money goes. Now given the relatively low amount of theft, fraud and waste, Nobo defers and waits.  
I think that the original poster might be in this predicament where the board members falsify documents, but are not stealing very much money? If this is not the case, Nobo would like to hear more detail about the alleged frauds committed.  
Nobo knows of lies and falsifications of documents and also knows that the State Attorney and the County Attorney say, this is a Civil matter. Hence Nobo and perhaps the original poster would have to pay a lawyer 10000 to 50000 dollars to get the issues into state District Court. There is a fair chance that Nobo and the Original poster might recover in a judgment their cash BET on getting the Law , Covenants and Contracts enforced. 
Nobo has Spoken. 

posted @ Friday, January 31, 2014 10:51 AM by Nobo_The_Condo_Hobo

There seems to be some important information missing here. I am curious, in general, as to what a crime syndicate wants with an HOA. You'd have to have a great deal of money passing through your HOA to make such an organized effort worthwhile. If money is being stolen, is your HOA not receiving all of the services that it should? Do you have a reserve account, and if so, what if anything is missing from that? 
Such an issue is way beyond the scope of this forum if lawyers and others have already poured over documents.

posted @ Friday, January 31, 2014 11:02 AM by Larry Davis

Once again, are the alleged frauds just falsifying the paperwork to keep the Association going or are actually significant amounts of money being diverted? 
If the former, and not significant amounts of the budget, fagget about it, and move on. Sounds like you have fallen into a trap of an obsession about people fudging the paper work. The lies might work in your favor in maintaining taxe excempt status of the association .. who knows without the details. 
Nobo has spoken.

posted @ Friday, January 31, 2014 11:27 AM by Nobo_The_Condo_Hobo

Issues involving board member misconduct or misbehavior are generally handled via the Associations governing documents (special meeting), or via a civil matter within the District Courts. If, however, funds are missing and such it would be a criminal matter. However, during one point there may be another player who is involved and an entirely different avenue of approach. Several years ago, while serving as Treasurer for our Association, one of our members began authorizing modifications to the exterior of a rental unit owned by his Brother-in-Law. All without the direct knowledge of the other Board Members, and or the members of the Architectural Review Committee. the procedure was merely to gather signatures and call a Special Meeting. This was done. However, the Attorney for the Association intervened in an attempt to mediate the matter. Clearly, in most cases under the Code of Conduct for Attorneys in most states, the involvement by legal counsel into the day-to-day activities of the Association is strictly prohibited. However, not only did it not stop here legal counsel filed an injunction against the other board members to prevent the Special Meeting. It was at this time that I learned a great deal about the Code of Conduct for Attorneys, the Attorney Regulatory Council of our states Supreme Court, and the grievance procedures. As such, a grievance was filed against the attorney under the rules which: 1) prohibit an Attorney for an Association from becoming involved in the day-to-day activities, and 2) the prohibition under the code against an attorney which prohibits legal counsel from suing a former and/or current client without their permission. The end result? Well lets see. Frist, the attorney spent the next six months answering interrogatories with the Supreme Court, 2) the malpractice insurance carrier refused to indemnify the attorney and the law firm, and 3) he was prohibited from practicing in the court room while under investigation. Then, to make matters worse he was essentially informed by the other partners that maybe it would be a good things if he were no longer a partner of the firm. You really can not put a financial value on this form of justice. As the investigator for the Supreme Court said, "Just with what you have cost this attorney, there is very little more that we could do aside from a slap on the wrist and a order a few Conflict of Interest classes." Yes, it was a unique circumstance. However, if as you say, the attorney was altering documents without anyone's knowledge, that may be an issue for the Grievance Committee of the state Supreme Court or the Bar Association to review. Then, if they find wrongdoing the matter would be forwarded to the appropriate law enforcement agencies with instructions. The best part of this process is that the Attorney is prohibited from taking retribution against you, both now and in the future. Just a thought worth considering. It just might be one of those Right Church, Wrong Pew issues. At least if this issue involves Attorney Misconduct, there are avenues for HOA residents and Board Members to seek recourse aside from any HOA related government agency.

posted @ Friday, January 31, 2014 11:27 AM by David C. Stiver MA

Nobo, you often make insightful, thoughtful and helpful comments on this blog. But I suspect their emphasis is greatly muted by the fact that you refer to yourself in the third person. Why present yourself like the character "Mongo" in Blazing Saddles or one of the characters from One Flew Over the Cuckoo's Nest?? Completely distracts from whatever point you are making in your post. 
Have a great weekend everybody!

posted @ Friday, January 31, 2014 12:37 PM by Bette Cessna

I am author of today's posting. Everything I related is true, the crimes are well documents 
and all correspondence with law enforcement by e-mail...all digitized. I know this seems impossible - it is happening in real time. While reading my post now, I see a misstatement; of the 4 offenses mentioned in my e-mail to Owners, 1 is about 20 years of vote rigging (1992-2013) - so 20 years of unchecked access to our cash. Since 1998, $800k debt added. For 2 years, our liability coverage went from $1m, to $100m; another year, the excess liability went from $1m, to $15m. I prepared a spreadsheet and forwarded original-source documents for the 20 years period. The spikes are obvious. I was told an investigation started.  
I've worked this 24/7 (31 months) and only the insurance issues received attention. Around noon, Jan 30, 2014, the CA AG called to say, for discretionary reasons, we will not get involved. That was my last hope, I'm out of gas, an none in law enforcement (anybody) cares. In my mind, I must try something new if I am to survive this. I appreciate reading the responses. Thank you.

posted @ Friday, January 31, 2014 1:30 PM by Steven Wildhaber

Steven: I am sorry. I am curious what is the specific relationship to the spikes in coverage. Also having a 3rd Degree Audit should speak to your facts and add weight. If there is "legal" proof to better shine a light on what you uncovered, it may be another approach. Also try law students -- it would be a case they could use as a project. Today they get the innocent released from life sentences. Think positive. Think out of the box. Again I am sorry for your pain.

posted @ Friday, January 31, 2014 2:53 PM by Linda

To Bette Cessna:  
Nobo speaks in the third person and with an absurd username for several reasons: 
Nobo does it to distance himself from the anger and resentment of powerlessness to control roque boards and fellow unit owners.  
Nobo is possibly better informed because Nobo has read his local state statutes, consulted attorneys, studied this and other condominium related web sites, and Nobo has repeatedly read over and over his Condominium Declarations and By-Laws. 
Nobo is a fool. Nobo is a highly educated fool with three degrees, in science up to Piled Hip Deep (PhD). Nobo was a fool to purchase a Condo without understanding the legal ramifications and limitations of the absurd Condominium contracts and Laws.  
Nobo feels that to reveal his real name would anger his fellow condominium criminals for exposing their neglect, and willful misbehavior, their ignorance and scorn for laws and contracts.  
Nobo has spoken, again.

posted @ Friday, January 31, 2014 3:18 PM by Nobo_The_Condo_Hobo

Nobo, it is a shame that this in a condominium blog and not one better suited to defining your narcistic personality disorder. I do agree that your format is rather off putting at best, but your information is often correct and you do think things through to a helpful conclusion. It seems however that no matter how many degrees you have (kudos for that by the  
way) you still haven't been able to assist that poor owner who has poured his life in to proving that a criminal acts are being committed by his condo board. We have all said a lot of words, but none have been helpful except perhaps the person who suggested he go to the FBI.  
Carry on.

posted @ Friday, January 31, 2014 3:40 PM by Observative Viewpoint

Linda, the annual liability coverage, during the 1995-2013 period, is $1m, except for 2006 & 2007, when it went to $100m. Except for $15m in 2002, the umbrella coverage is $1m or $2m, with no aggrigate limit. Because there has been no scheduled improvements performed (until after they filed the libel suit against me!!), and no new construction, there's no need for increased coverage, unless a potential loss IS ANTICIPATED. I am one of very few to have lived here 30+ years, served as HOA treasurer (I had a career in accounting & finance) and retained all papers, I have perspective new buyers can't have. With fraud gov docs in place, this group uses oppressive management techniques, so new buyers are "conditioned" to not expect much - and not make waves. I have several ideas as to the (big) motive behind this criminal scheme, which appears to be so fantastic, most can't get their mind around it. It's a very daring and effective scheme, perhaps based on a movie. See the Las Vegas HOA takeover posted atwww.usdoj.gov (search for HOA FRAUD). Our Napa takeover is smaller, but has the same orchestration of players, very similar story line...criminals, with rogue lawyers running interference. When I found the 6/1/2012 report, the FBI posted all elements of the case, including plea statements and sentencing guidelines. (26 guilty pleas, with 4 meeting an untimely death) I believe those background papers are now removed. I downloaded every doc I could find in June, 2012.  
Part of our problem is the vast wealth in Napa Valley; our project, neglected for 20 years, lost its luster and has been, perhaps, red-lined. We don't count here and police protection is...discretionary?! Two months ago, another Homeowner referred to me as a whistleblower. I believe this is also a factor. I am seen as being in the shadows of Wikileaks and Mr. Snowden. SW

posted @ Friday, January 31, 2014 4:08 PM by SW

To observ.. view.... 
If there is there is real monetary fraud, then, he or she might camp out at his state legislators office or campaign the county prosecutor s office. The state AG is the person with jurisdiction. Vote rigging is probably only actionable in civil court. It still is not clear what damages he or she can personally claim.  
Has the original poster consulted with a lawyer? Can he or she enlist other unit owners to start a civil action?  
Pro Se filings are possible... if it was me I would be studying the law... and trying to hire a lawyer. Find out the risks of losing and being forced to pay the bill....  

posted @ Friday, January 31, 2014 8:34 PM by Nobo_The_Condo_Hobo

1) Rent a safety deposit box to store the evidence so that worry will be alleviated. 
2) The author is doing the right thing, setting up a special meeting. I think the situation is going to be complicated, so if he is going to win his political campaign, he is going to have to start campaigning now.  
Ideas: Summarize the issues for the special meeting, why it is important to each unit owner, and the goals and the risks.  
Things the special meeting could be about 1) deposing present board members, electing new board members? 
the meeting could be about hiring an attorney to revise the CC and Rs, or bylaws, new officers..... or compel the officers to act. 
Whatever the goals are, the OP or author might need to educate and convince the unit owners before hand on a course of action. I would think a letter writing campaign would be in order. As for as libel is concerned, if it is the demonsterable truth, there is no libel.  
I would try to find a news outlet. It could even be a local or muckraking source, a blog . 
The original poster could scan in evidence and make his case on the blog or web site. And in letters and flyers provide links and summaries of the fraud. 
The OP says the AG declined to prosecute on his discretion.. this could be for many reasons, such as dirty politics or a lack of a case beyond a reasonable doubt. However there might be a preponderance of evidence, that would win in a civil case.  
One goal of the special meeting might be to hire a lawyer to look into prosecuting the fraud in civil court, trying to recover damages, and amending the CC Rs.  
Someone mentioned making a complaint to the CA "Council of Discipline" or what ever board CA has. They can act against any attorneys at the preponderance of evidence level. If the lawyer is crooked, there might be other complaintants in related matters.  
To SW, don't worry about being seen as a whistle blower you are doing a public service.  
It sounds like SW needs to work on educating and informing his fellow unit owners and this might be more successful, a peasant (unit owner ) revolt. Try googling "Controlling a rogue condo board".  
If you can get YOUR board elected , they can take back control of the finances and start the process of amending the Condominium Documents (which would involve convincing a large portion of the unit owners to approve.). 
SW, why are you doing this alone? You need to solicit like minded unit owners and a lot of them. Somehow in these future actions if you had allies that would help your cause and your state of mind... Between now and the meeting do everything in your power to win allies to your cause... 
John Mastro

posted @ Saturday, February 01, 2014 8:06 AM by John_Mastro

SW here.  
I received so many good ideas...Thank you, everyone, especially: 
 David Stiver, rules against lawyer's day-to-day involvement in HOA matters; 
 John Mastro, muckraking and uploading evidence to a website; 
 Linda, law students and a class project; 
I conclude: I am not alone; law enforcement may not always be reliable; that civil actions are costly, with no guarantee of outcome; that guerilla warfare may be the only solution. (It is how I got this far) Since my first takedown in 2001, I contemplated the likelihood they might continue, so I kept detailed notes, documented conversations, e-mails, and took photos. Since fall 2011 I did the same with; copious notes, photos and, this time, tied to the California codes. 
The thought came over the weekend: this 20-year journey would be the script for a good crime novel, a memoir, tv series, or an expose on our HOA-owners' predicament. It has all the ingredients of a compelling, interesting and comedic story that can be used for numerous purposes. My work is that substantial, well-done, and relevant. It seems this may be a singular event...a singular opportunity to work with a real-time, sophisticated and well-orchestrated criminal scheme - start-to-finish - as it moves toward prosecution. If one is interested, please contact me, or provide contact information. I will forward the necessary documents for a proper evaluation. And, if I'm all wet, it's better I hear it sooner, than later. Thanks, SW  

posted @ Monday, February 03, 2014 4:33 PM by SW

Our HOA had embezzlement and kickbacks on EBMC (Eugene Burger Management's) watch.  
Insurance coverage for D&O (director dishonesty) was reduced prior to the embezzlement - probably so insurance company would NOT investigate a big claim. 
Countless homes were fraudulently foreclosed as a result. 
Not legal/tax advice - but, have you thought about reporting to IRS and FBI?

posted @ Tuesday, November 11, 2014 12:28 AM by Nevada HOA Fraud

We dropped EBMC years ago because they are HORRIBLE property managers! Never trust EBMC.

posted @ Wednesday, November 12, 2014 12:49 PM by Bette Cessna

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