Category Archives: Fraud

A Completely Imaginary Conversation

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Imagine for a moment that your company has transferred you to California’s Central Valley. Lots of warm days are in your future, you get a chance to dry out from all the rain and snow in your old home town.

Your Realtor has been driving you around several neighborhoods in Angels Camp: Saddle Creek Resort, Copper Cove and the little community of Copperopolis. Suddenly you see it! The house of your dreams! The yard is nicely kept, the rooms are large, the last owner has really taken good care of the place. “What’s the neighborhood like?” you ask the Realtor.

“Oh, it’s pretty good,” she says. “The HOA likes to keep things in order. They make sure everyone knows the rules and keeps the neighborhood neat. There’ve only been a couple problems here.”

“Problems? What kinds of problems?”

“Ah,” she says. “A few years ago, one couple didn’t pay their $120 annual dues. The HOA popped them with a lien and then sold their house at auction. It cost the couple $70,000 to get it back. The couple won’t do that again.”

“Whew! What else?”

“Hmmm,” says the Realtor. “Oh yeah. There was this disabled guy who couldn’t get into his house. He got permission from the county to build a wheelchair ramp. But he didn’t ask the HOA first, so they popped him with a fine of $15,000.”

“Wow!” you say. “That seems a little harsh.”

“No, not at all. It keeps folks in line. Keeps up property values.”

“Anything more?” you ask.

“No,” says the Realtor. “Oh yeah, almost forgot. There was one thing that happened here a few months ago. The office manager of the Copper Cove HOA, the same one you’re in right now, stole about $25,000 from the neighborhood treasury. She embezzled 18,000 bucks and used the HOA credit cards to buy all her gas and groceries.”

“Who has to make all that money up?” you say as you raise your eyebrows.

“Well, after she gets out of jail, she might have to do some restitution. In the meantime, a special assessment from all the homeowners will be used to rebuild the treasury.”

You take a long last look at that nice house, the neatly trimmed neighborhood and the blue skies.

“I think I’m going to look elsewhere,” you tell the stunned Realtor. “I lived in an HOA once. Nah, don’t think I want to do that again. See ya!”

http://www.uniondemocrat.com/News/Local-News/Copper-embezzler-sentenced

Fraud? In An HOA? G’wan!!!!!!!!!

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As I’ve said before, once in a while you’ll find a lawyer who may actually be given a spot in Heaven. Is this another one?

Fraud in community associations.  by: Bill Raphan September 13th, 2012 | 2:41 PM

Unfortunately, there is fraud being committed in community associations throughout the State of Florida every day.

I spent 5 years working with the Economic Crimes unit of the Florida Department of Law Enforcement in their Condominium Anti Fraud program.

The good news is that the majority of the complaints that were submitted turned out not to be fraud but were only mismanagement or misappropriation of funds.

Usually, it was unintentional and just from a lack of knowledge.

However, there were times when there were red flags that caused the need for further investigation and sometimes arrests and prosecution.

What should you as an owner look for if you suspect fraud in your association?

These are some of the most common fraudulent activities that were found:

Kickbacks – Vendors paying off board members “under the table”

Including over inflating contracts and “kicking back”  the difference

Schemes concerning credit cards

Altering or falsifying financial records

Forged signatures

Paying for work not done

Paying nonexistent employees

Submitting false expense vouchers

Want to learn more about fraud, contracts, dealing with vendors, and much more?

Next Wednesday, September 19, 2012, we are conducting our free “Board Member Basics” board certification class.

The class will be held at our Katzman Garfinkel and Berger Law and Learning Center

5297 West Copans Road from 10 AM – 12PM

To register call 954 315-0372

http://blogs.sun-sentinel.com/condoblog/2012/09/fraud-in-community-associations.html

Steamy HOA Poop!

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I promise you, I absolutely promise you I have tried to avoid writing about this story. It first popped up about three years ago, and is so far outside the realm of common sense that I haven’t wanted to damage my own credibility by retelling it.

Still, more and more HOAs around the country are turning to DNA analysis to find out whose dog is pooping on whose lawn.

No, really.

There’s nothing that drives an HOA board member nuttier than seeing someone else’s dog squat on an unapproved lawn. And technology has made it cheaper for an HOA to actually trace a dog dump.

Remember the days of OJ Simpson when a DNA test took eight weeks and cost about fifty thousand dollars? These days you can get an overnight DNA test for about eighty bucks. Which brings up HOAs like the one in Austin, that now require all dog owners to have their pets “registered.” I guess that means a doggie cheek swab? I don’t know for sure, but it’s a sure fire way of getting even with a next door neighbor who keeps walking his dog past your mailbox.

If you see an unauthorized poop, you can now grab a spoonful and send it to the HOA’s lab. A few hours later, you have enough evidence to go bash in your neighbor’s door.

Life is grand, isn’t it?

http://www.khou.com/news/texas-news/DNA-for-dog-poop-Is-Austin-HOA-going-too-far-169755886.html

Neighborly Love in Florida

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It’s pretty amazing to see the way some neighborhoods tear themselves apart.

The latest goofball story comes from Lake Asbury, Florida. The HOA is threatening to foreclose on the homes of 26 families because they don’t want to pay a dues increase of $50. The HOA needs the money to help maintain docks and boat ramps on the lake. Fifty bucks seems pretty trivial, but the homeowners are taking it to court.

In the meantime, the anger, the frustration, the hatred has made Lake Asbury a pretty attractive place to live, right?

An Amazing Lawsuit Filed in Arizona

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It’s long been the opinion of this blogger, that the American Homeowners Association Movement is destined to collapse under the weight of its own corruption, deceit and abuse of power. That day is still in the future. In the meantime, an amazing lawsuit against illegal activity among that state’s HOAs has been filed in court. What a relief! There may be some lawyers admitted into Heaven after all! The law firm’s press release is below:

The Law Offices of J. Roger Wood, PLLC 1628 East Southern Avenue, Suite 9-310 – Tempe, Arizona 85282, (602) 324-7126 –

For Immediate Release:

Class Action Lawsuit Filed by Arizona Homeowners Against

Arizona HOA Management Companies Alleging Millions of Dollars of Damages for Violations of Federal Debt Collection Laws and Arizona Law

(Phoenix, Arizona – September 20, 2012)

– Two Arizona homeowners, have filed a class action lawsuit against twenty-seven Arizona community association management companies (“CAMs”).

There are thousands of Homeowners Associations and Condominium Associations in Arizona. A majority of those HOAs contract with management companies to assist the HOA and its Board with the day to day operations of the Association. In addition to the every day tasks, some Arizona CAMs also have made agreements to assist HOAs in collecting past due homeowner assessments.

The complaint alleges that these CAMs, acting as third-party debt collectors, have engaged in unlawful activities in their attempts to collect past due assessments from Arizona homeowners. The plaintiffs allege that the CAMs have and continue to pursue Arizona homeowners by charging collection costs and related fees that are not authorized by law. Public court and county property records show that CAMs have wrongfully filed and recorded thousands of liens, lawsuits and judgments in violation of the federal Arizona Court Rules, the federal Fair Debt Collections Practices Act, the Arizona Constitution and Arizona’s wrongful lien laws.

The plaintiffs allege that the CAMs’ collection activities violate Arizona’s rules regarding the unauthorized practice of law. The public record shows that CAMs sign and record liens, file lawsuits, negotiate the legal rights of third parties, appear in Court and collect fees for these services. Arizona law does not allow non-lawyers to act on behalf of a third parties in legal matters. Such activities require a law license and these violations trigger liability under federal debt collection laws. The CAMs’ unlawful fees for these activities have cost Arizona homeowners millions of dollars.

The lawsuit seeks to end these unlawful practices and also seeks an award of damages for the named homeowners and the thousands of other Arizona homeowners who have been victimized by these CAMs and their unlawful collections activities.

The Law Offices of J. Roger Wood represents Arizona homeowners who have disputes with their Homeowners Associations or Condominium. Watters and Watters are trial lawyers representing Arizonans in civil litigation, including employment issues or toxic tort exposures. The firms are working together on this case, seeking to right these serious wrongs. They can be contacted at

info@jrogerwoodlaw.com or legalhelp@watterslaw.com or at the telephone numbers listed above.

Watters & Watters, PLLC P.O. Box 65147 – Tucson, Arizona 85728