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CHECK YOUR CHECKS
By
Eric Glazer, Esq.
Published May 18, 2015
Many of you may
have seen the news again this week concerning allegations that
another licensed community association manager misappropriated
over $220,000.00 from a condominium association in Hollywood.
Click here if you missed it:
http://www.local10.com/news/lawsuit-property-manager-embezzled-228000-from-condo-association/32977920
It certainly seems to
be a growing problem. Over the last few months I have personally
been involved in three significant cases of theft of association
funds. In all of the cases, the one common denominator is that
the person with check signing authority was involved in the
theft.
In one of the
cases, there was no management company managing the association.
So, the President didn’t have much supervision and helped
himself. In another, there was a community association manager
working for the association who simply failed to catch the
President steal six figures, and in the third one it’s the
manager herself who is accused of the wrongdoing
by fleecing the association’s funds by writing checks
to a company she owned.
So what are we
learning from all this? Apparently, it may not be enough to rely
on the community association manager when ensuring that the
accounting is accurate and all funds are accounted for. Someone
on the Board or perhaps a committee needs to check up on the
manager. Next, it’s far easier for a Board member to get away
with wrong doing if there is no management company and no
interest by anyone else on the Board or in the community in
checking up on the Board member in control of the check book. In
one of the cases mentioned above, it was my client, a unit owner
who was not even on the Board, who uncovered the theft. The
other Board members never caught it. I should disclose however
that my client actually is a rocket scientist. No joke.
When there’s access to a large amount of
money, and little risk of getting caught, because nobody cares
about checking the numbers, perhaps the temptation to dip into
the till runs high. There’s older examples of Board members who
were described as “devoted” and “kind” and “sweet” stealing
association funds and losing them in slot machines at the
casino. Everyone let their guard down, turned their back and had
too much trust in one person. It’s all about having proper
checks and balances. So what do you think? Why are some Board
members and/or managers suddenly so brave? What percentage of
wrongdoing do you think actually gets caught? How do we prevent
it?
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About
HOA & Condo Blog
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Eric
Glazer graduated from the University of Miami School of
Law in 1992 after receiving a B.A. from NYU. He has
practiced community
association
law for more than 2
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decades
and is the owner of Glazer and Associates, P.A. a seven eight
attorney law firm with offices in Fort Lauderdale, Orlando and
Naples.
The
firm also has satellite offices in Tampa and Fort Myers.
Since 2009, Eric has been the host of Condo Craze and
HOAs, a weekly one hour radio show on 850 WFTL.
See:
www.condocrazeandhoas.com.
He
is the first attorney in the State of Florida that designed a
course that certifies condominium residents as eligible to serve
on a condominium Board of Directors and has now certified more
than 8,000 Floridians all across the state. He is certified as a
Circuit Court Mediator by The Florida Supreme Court and has
mediated dozens of disputes between associations and unit
owners. Eric also devotes significant time to advancing
legislation in the best interest of Florida community
association members.
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