Long-time readers of this blog know that the most corrupt Homeowners Associations in the country are in Nevada. We know that from the 41 or more organized crime racketeering convictions earlier this year in Las Vegas. Just as I predicted, despite the tens of millions of dollars in losses all but one of these HOA mobsters got less than 18 months in federal prison.
That being said, there are some shining lights of honesty in that area. Dr. Gary Solomon, Jonathan Friedrich, Colonel Robert Franks among others. Sadly, the corruption is so rife within the Homeowners Association movement that the system works hard to stomp out those who sacrifice to help others.
Today, Bob Franks sent out the following letter to explain to his legions of admirers why he has to step back in the fight for homeowners’ rights:
My appointment to the HOA Commission is completed. I did not request
reappointment for a normal 3 year term. So, I can now move on with the
satisfaction that CICCH Commission records show I did my best to make a
difference on behalf of unit owners.
Regretfully, the record shows that legislative and executive branch
authorities do not appear to want the CICCH (HOA) Commission to
effectively perform its statutory mission on behalf of all home
owners. It is under the tight control of industry and government
interests–to the serous detriment of unit owners and other occupants.
The record of the past decade shows that well over 95% of unsettled law
violation complaints filed with the state by unit owners against HOA
boards and licensed managers are summarily dismissed by the state. The
division does not have to show or defend the merits and results of its
secret, multi-year investigations with board presidents and their
attorneys. The division’s dismissal decisions are not subject to
anyone’s review or dispute unless high cost civil lawsuits are
initiated. This is gross injustice for unit owners. Imagine if the
courts only tried 5% of the valid complaints filed with them?
The less than half a dozen cases out of hundreds filed each year that
are actually prosecuted under the administrative statutes by the
Attorney General staff to the CICCH Commission always reflect high level
criminal violations as well. But, criminal investigations and
prosecutions never seem to get prosecuted. HOA and Condo unit owners
are losing many millions of dollars due to known criminal violations
every year and the government is failing to do anything. This knowing
and willing failure of justice for HOA owners is a true outrage for our
state.
The Real Estate Division is also not subject to any kind of outside
oversight of its decisions that almost always favor the boards and
licensed managers. This means the Division is given a blank check by
the Legislature to continue to hide its apparent misconduct and denial
of homeowner justice.
As a result, HOA owners currently have no viable paths for demanding and
expecting to receive citizen property rights protections from the
abusive industry and state/local government controllers.
Unfortunately, it now seems clear that a large, Nevada grassroots
organization and legislative caucus must be formed to represent
aggrieved property owners against the combined business and government
power blocs. The consequences of doing nothing can create a continuing
blight upon the previously attractive Nevada home markets.
Slowly, but surely state legislators are hearing from bullied homeowners that the national HOA scam is ruining lives. And more news agencies are doing stories on out-of-control boards. The story linked below is from South Carolina which has a growing number of homeowner complaints.
Legislators tell themselves, “Of course, we can pass some laws.” Only problem is they can’t. The U.S. Constitution guarantees the ‘right to contract.’ And you certainly can sign a contract to give up your constitutional rights. That’s the rub. Florida’s Deborah Goonan has it right when she says at least we can license HOA management companies. That’s a good start. But it won’t end the nightmare of board members who feel entitled and empowered to throw their weight around.
Still, the more people who complain to legislators, the better. Ultimately, though, the solution has to come from the courts.
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.
