East Texas, Big Woods Springs HOA is a relatively small community of 85 homes, with low assessment payments of $35 per month. They need the money to maintain their road, a small bridge, and a dam for their lake. Homeowners have just been “blindsided” by the theft of $31,000 from their HOA.
The theft allegedly occurred over a 26-month period, by their neighbor and former Treasurer, Letha Anna Thomas. Owners became suspicious when their repeated requests to see financial statements were ignored.
The new Board members vow to operate with transparency, and intend to conduct background checks on all future Board candidates.
Note that $31,000 represents about a year’s worth of assessment payments for the Association. Most of the residents are on fixed incomes.
Just because the community is small and assessments are low, don’t assume that the HOA cannot be a target for embezzlement.
7 on your side: HOA theft victims say, “We’ve been kept in the dark for years.”
Anybody who’s seen the ugly insides of the national HOA scam knows that Homeowners Associations are lawsuit machines. In most lawsuits and criminal actions Americans have access to the Due Process clause of the U.S. Constitution. In the typical Homeowners Association each member unknowingly contracts away that access. Bam! In Pennsylvania Dutch, “there goes the egg money!”
Throw away your access to Due Process and every lawyer within spitting distance knows there’s money to be had. Free money. Your money. Paint your door the wrong color and you get fined, liened, sued and you pay all the HOA’s legal expenses. Lawsuit machines. No other possible description.
In Arizona, a prominent HOA law firm is all upset by a court ruling that says lawyers can’t tack on extra legal fees they rack up trying to garnish the wages of a losing homeowner.
Rest assured, though, this law firm has a number of sneaky plans to hijack this decision. The lawyers win. The lawyers always win.
They got him! A couple of days ago a longtime HOA manager in San Mateo, California was arrested and accused of stealing 2.8 million dollars from the Woodlake Homeowners Association. Now they’ve arrested her partner, a man who allegedly wrote fake invoices for construction work that was never done. It sure sounds like a copycat of the decade-long swindle of homeowners in Las Vegas.
And it sounds a lot like the multi-million dollar organized crime racketeering swindle of Homeowners Associations in Colorado.
And Homeowners Associations in Florida.
In Alabama.
Virginia.
Texas.
And every other state.
Still, you keep hearing from Realtors, and Congressmen, lawyers, city officials and state representatives that this kind of swindle is extremely rare. What are these guys smoking, anyway?
I’ve said it before, and I’ll say it in the future. When you’re investing your life savings in your home, don’t trust anybody. Don’t trust the Realtor. Don’t trust the county’s master plan, and above all do not trust your HOA. Homeowners in Chula Vista, California are learning about what all west coast residents know as ‘Californication.’
They bought into a peaceful valley where traffic was minimal, wildlife was everywhere, no smog was in the air. Life in the Eastlake III Homeowners Association was Heaven on Earth. The master plan showed their pristine way of life would last forever. But that kind of promise evaporates the minute land developers start knocking on doors. All of a sudden builders began jamming high density neighborhoods all around, packing in low quality homes like sardines in a can.
Eastlake III is no longer the promised land. The Homeowners Association is embroiled in legal disputes, recall elections, charges of corruption, violence threatened. Police are being hired to maintain the peace in HOA meetings.
Promises are like…. no, discretion says “don’t go there.” Let’s just say that promises are hollow. And promises made by a Homeowners Association are especially worthless.
The Community Associations Institute (CAI) is famous for testifying before state legislatures that it represents all homeowners living in HOAs. Absolute nonsense. In the beginning it probably did. But in the early 1990s a conscious decision was made to turn the organization into a referral group, sending high-dollar referrals in HOA disputes to its member lawyers, property managers and contractors. Under its phony non-profit shield it sent out surveys on how satisfied Americans were with their Homeowners Associations.
Whoa! Any legitimate, honest survey of homeowners living under the HOA yoke should have told a far different story. Finally, some in the anti-HOA movement are releasing studies which appear to be far more legitimate than the pablum being spread by the CAI. It’s hard to get legislators to pay attention to what they see as a non-issue. But surveys like the one linked below tell a more interesting story about homeowner dissatisfaction and abuse.
Also, housing consumer advocate Deborah Goonan was interviewed about this story today by Shu Bartholomew, host of OnTheCommons.net. It really is worth listening to.
