Condo Association Management Blog

http://www.ohiocondolaw.blogspot.com/ 
 
 
 
Read short article above....You should be worried!

RUN - don't walk. This is a clear and dangerous situation for the condo assets. 
Your association CPA should be able to provide clarification.  
Legal counsel will advise proper steps to take to immediately recover your funds and may recommend that this is cause for termination of a management contract. 
 
 
The condominium is a business entity (even if not incorporated) and all income is to be maintained in the name of the association.  
 
New FHA guidelines for approvals and for recertification require that a management company maintain a fidelity bond covering the amount of reserves and 3 months assessments in the name of that condo.  
 
Most mortgage underwriters ask for verification that the reserve accounts are limited to association board signatures.  
 
For many years, leadership in Community Associations Institute has stressed that all reserve accounts should only have signatory authority by the board of directors not listing the mgmt co at all. This is related to the knowledge that almost all theft of funds over the years has been by owners/officers of the mgmt co, not the board members.  
 
Furthermore, the association must file income tax reports EVEN when no tax is payable and must show all income. An account in some other name cannot be issued a 1099 for your condo association.  
 
States such as Virginia have addressed the issue of requiring substantial fidelity bonds by mgmt to prevent loss of condo owners assets. The movement to another entity's account could easily be the first step to fraud.  
 
Again, do not hesitate to immediately rectify this situation. (I chaired a 6-month study on fidelity bond issues several years ago after a major loss of assets by several associations due to the owner of the mgmt co "borrowing" funds to cover his real estate development projects. Some associations lost a substantial (1-2M) amount and never recovered the funds. The mgmt cos fought to have control of the reserves as this made them players in the financial markets.  
 
The association's fudicial responsibility is to protect the assets, even in a stagnet market.  
 
Regards, Nancy Jacobsen  
 

Would you like to put your personal savings into someone else's bank account to get more interest? How would you determine the interest you would get from this venture! 
 
GET IT OUT OF THEIR HANDS ASAP!

Plain robbery. Get a complaint to your District Attorney

I totally agree with the comments posted here. I must ask: where is your board? Why are they allowing the mgmt co to do this? IMO the contract with this prop mgmt co should be terminated and the board members should not be re-elected as they definitely are not acting in the best interest of the assn and it's members by allowing this. Hopefully the treasurer has been keeping track of all the monies that have been transferred to the mgmt co so that if and when their contract is terminated all the assn's monies will be transferred back to the HOA bank account.

OUR HOMES ASSOCIATION WAS TAKEN FOR OVER $10,000 BY A MAN NAMED DALE PALMER. HE SAID HIS BUSINESS WAS CALLED HOA SERVICES. ONE OF THE BEST THINGS WE DID WAS NOT TO GIVE HIS COMPANY TOTAL CONTROL OF ALL OF OUR MONEY. AT THIS TIME I DON'T BELIEVE THERE IS ANY HONEST COMPANIES TO MANAGE YOUR ASSOCIATION SO BE CAREFUL WHO YOU TRUST AND TAKE OUT INSURANCE TO COVER ANY THIEVERY.

Report to the district attorney for commingling of trust fund which is a grant theft. 
 
The DA will ask you to report to the police. 
 
The Police will shrink from investigating if the culprit says it has hired an attorney to answer questions. 
 
The truth of the matter is that the police should obtain a search warrant based on your declaration or complaint. 
 
The court can appoint a special master (In California it is so called. In other states, it can be in other names) to accompany the police to search for the banking records and book account records fo the association evidencing interminling of trust fun. 
 
 
 
The cost of the special master (who is a volunteering attorney selected to serve by the state bar) is paid by the state.(Califorin supreme court case of People vs. Superior Court (Larr)) 
 
C

There is probably something written about this is your HOA by laws. Check with them to see how you should procede.