Category Archives: Fraud

The Dictatorial Power of the Homeowners Association

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Negative experiences continue making national headlines, as HOA homeowners share stories of almost incomprehensible conflict. A homeowner who loses her home because she underpaid her dues by 78 cents! (Florida) Homeowners fined because they put up some Halloween decorations.(multiple locations) Christmas decorations banned in neighborhood after neighborhood. An HOA president who orders a board member to poison cats with anti-freeze! (Arizona)  What is going on? Have people just gone crazy?

Kim and Ed Hartnett owned a nice condominium at Spinnaker Run 1, but their Homeowners Association has levied so many fines against them for late payment of dues, that they just can’t catch up. They’ve abandoned their nice condo and are now living in a motor home.

Homeowners Associations are theoretically supposed to improve property values, but the actual experience by many homeowners is that home values are being crushed by the presence of a Homeowners Association. Too hard to believe?

Well, would you want to buy in an HOA where the president has just pleaded guilty to embezzling hundreds of thousands of dollars from the neighborhood budget? (multiple locations)  Would you buy into a condo where a grandmother is foreclosed on because she accidentally underpayed dues by $4.70? (Venetian Village, FL)  Would you (or could you) get a loan to buy a place in Clinton, CT, where the FHA and HUD have decided they will no longer offer federally backed loans? And would you buy a home in a neighborhood where you are prohibited from having your grandkids stay the weekend?

When faced with allegations like these, HOA officials almost universally refuse to comment. That’s obviously the advice they’re getting from legal firms that represent the HOA quagmire.

But really, do HOAs protect home values? Ask homeowners in Las Vegas, where some homes have dropped 80 percent in value. Or look at Florida where homeowners can’t even give their homes away. Just ask a Realtor if more and more clients are asking to see only non-HOA homes.

Are there good HOAs? Of course. But it just takes a single election for an HOA board to turn from gentle to rogue. And how difficult is it for a neighborhood to ‘unelect’ a rogue board?

HOA officials across the country are told by attorneys and property management companies, “Don’t worry. The odds are practically ZERO that the voters will ever rise up and remove you from office. You’re safe. Just keep doing what you’re doing.” They do. And the value of homes in gated communities continues to fall.

Ward Lucas
Author of
Neighbors At War: The Creepy Case Against Your Homeowners Association

Where Is The Justice?

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Every time I read of a homeowner who’s lost his or her home to a bank foreclosure, it breaks my heart. HOWEVER, every time I read of a Homeowners Association which has done the same thing to a homeowner, it infuriates me.

Homeowners Associations can foreclose on a member of an association in a matter of hours for even the pettiest violation of the covenants. Yes, I agree that all homeowners should be required to pay their HOA dues ON TIME! No exceptions. HOAs need those funds to operate and to maintain the common areas. The problem is that many HOAs and management companies are abusing that power.

Take for example, the case of Stephanie Bonefont, a member of the South Pointe Homeowners Association in the Tampa area.

In 2008, this single mom’s house was foreclosed on because of unpaid HOA dues. Cut and dried case, right? She should be tarred and feathered and run out of town strapped to a rail, right?

Hmmm, let’s take a closer look at her case. It turns out Bonefont’s bills for her dues were apparently being sent by the HOA to the wrong address and she had no idea she was in default. But that didn’t matter. The HOA snatched her home and sold it to a bidder, Pasto Angula, for $7400, the amount of her missing dues and legal expenses. A judge saw through the property grab and ordered the home returned to Ms. Bonefont, after she reimbursed Angula for $7400.
But the South Pointe HOA claimed it had no evidence she had paid Angula, despite the fact that her attorney produced a copy of the check.

And now the HOA is moving forward with the lawsuit until the woman writes THEM a $7300 check. “Double dipping,” Ms. Bonefont calls it.

This is America, the model for the entire world, where people are supposed to be able to seek and find justice. But our litigiousness has made America the laughing stock of the world.

How is it that cases like this slip through the cracks? Why can’t a judge just lock all the parties in a room and say, “I love you guys, but I’m not going to let you mock the American justice system. You’re staying right here in this room until you figure out how to settle this case in a way that will make all parties believe that they were able to find justice in an American courtroom!”

Some of these cases have an obvious solution, but it requires forcing all parties to mull over their own mistakes, and emerge from the room when they have a solution. Before the PC movement, some moms used to do that with their kids! “No lunch until you solve your own problem.” These days, that kind of thing is called “child abuse.”

What’s the solution? How can you solve a case like this without trashing the Constitution? Ah, and no lawyers allowed! They just seem to gum up the system!

Here’s an incentive: “Hey folks, if you DON’T go to court, you’ll be saving about thirty thousand bucks worth of attorneys fees. So let’s throw that same amount of money into a common pot, and let the warring parties decide who gets to split the pot and how evenly.”

The lawyers would never let that happen, of course. Not in a million years, would they let that happen. Hmmm, maybe THAT’s the problem.

“I don’t think you can make a lawyer honest by an act of the Legislature. You’ve gotta work on his conscience. And his lack of conscience is what makes him a lawyer.”
-Will Rogers

Ward Lucas
Author of
Neighbors At War: The Creepy Case Against Your Homeowners Association

The Handicapped and the HOA

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One of the tragic stories we come across time and again is how the Homeowners Association Movement discriminates against the handicapped. Yes, we know it’s illegal. Yes, we know the handicapped are a critically needed resource in this country. Yes, it’s common sense not to discriminate against them. But the Homeowners Association Movement was created for a reason. It’s very structure was designed to weed out anyone who doesn’t fit the “official profile.”

As explored in my upcoming book, “Neighbors At War: The Creepy Case Against Your Homeowners Association,” that “profile” is devious and absolutely designed to weed out blacks, orientals, the handicapped, the single moms, gays, and anyone else who doesn’t match the cookie-cutter, bleached-beige stereotype of HOA life.

A member of the military, disabled by an I.E.D.? Begone!

A single mom trying to raise child? Foreclose on her house!

A black family in a white bread neighborhood? Outrageous!

While most HOAs seem to operate well and keep their neighborhoods at peace, we are all unfortunately defined by our extremes. And in recent years, a growing number of Homeowners Associations have been taking advantage of their ability to be extreme.

HOAs have learned how to profit by foreclosing on homeowners who make petty mistakes. An incredibly small violation of neighborhood covenants can lead to outright seizure of a home. Are all HOAs doing that? Of course not. Should all HOA members be concerned at how often it’s happening. Absolutely.

“A nation’s greatness is measured by how it treats the least of its citizens.” -Mahatma Ghandi.

How true, how true!

Ward Lucas
Author of
Neighbors At War: The Creepy Case Against Your Homeowners Association

Five Crooks Down, Dozens More to Go

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There’s no way to explain how significant the Homeowners Association corruption scandal in Las Vegas really is. It’s huge, of course, for Nevadans. More than any other state, HOA members there have seen their home values plummet, sometimes up to 80 percent.

In the Las Vegas disgrace, a fifth person, Angela Esparza, 24, has now pleaded guilty to helping rig HOA board elections with phony ballots and proxies. She’ll get off easy, though. It’s sad to see that she’ll get a light sentence, but at least she’ll be snitching on some of the other major suspects in this stenchy scandal.

Good old Las Vegas corruption. Judges, cops, attorneys, HOA board members and management companies. In fact, Esparza has told investigators she prepared some of her phony ballots in the office of a certain lawyer. Vegas residents, of course, all know who that lawyer most likely is.

Investigators and prosecutors from Washington DC had to be flown in to complete the investigation because there was too much suspicion of potential corruption in the Nevada U.S. Attorney’s office.

How important is this federal investigation? The FBI and the U.S. Attorney have created an investigatory model that could be transported to just about any major city in America. The kind of corruption being discovered in Las Vegas is going on across the country. For reasons explained in my upcoming book, Neighbors At War: The Creepy Case Against Your Homeowners Association, the problem is not that crooks intentionally try to get onto HOA boards. It’s that the whole HOA structure begs for crooks to come on board.

A massive number of homeowners have lost their homes to foreclosure, not just foreclosure to the banks, but foreclosures carried out by corrupt Homeowners Association boards. In fact, HOA foreclosures are often done for incredibly minor violation of covenants. Bank foreclosures are overseen by thousands of pages of state and federal rules. Nothing oversees an HOA foreclosure.

Often, the “lucky stiff” who ends up buying the HOA house for pennies on the dollar, is a board member, attorney, or another “insider” who’s tipped off that a “super quick seizure and auction” is going to be taking place. That buyer is usually the only one at the auction. He quickly re-sells the house to make it impossible for the original owner to get it back. Any kickbacks? Ha! We’ll have to wait and see! The FBI expects to take down dozens of highly placed officials over the next few months. (Insider’s tip: A major player in this ring of Las Vegas swindlers has already left town to set up a similar scheme in another sunbelt state. Hmmm, could it be a lawyer?)

Homeowners Associations are de-facto governments. Yet they have far more power than most other governments. They don’t have to abide by such concepts as free speech, freedom of assembly, respect for religion. The Second Amendment is so much trash to some HOAs. Racism and discrimination are endemic. Unannounced inspections of the interior of private homes is going on in California and elsewhere. Discrimination against the handicapped exists everywhere.

Yes, there are good Homeowners Associations and many people are happy with their own. But the system, itself, is flawed. Every HOA is just one rigged vote, one faked proxy and one election away from putting into office the kinds of people who are stinking up the Las Vegas housing market.

God Bless the F.B.I.

Ward Lucas
Author of
Neighbors At War: The Creepy Case Against Your Homeowners Association

Real HOA Nightmare Stories

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One question each homebuyer should deliberate before buying a property in a homeowners association is, “Am I buying a home in Paradise, or will the HOA make my stay a living hell?”

Homeowners Associations offer promises, of course: security, clean streets, well maintained homes, nice amenities. Some new home buyers find it a positive experience. Others discover they have bought into a nightmare. Still others find their homes foreclosed upon, sometimes for the pettiest of reasons.

Here are some recent homeowner stories collected by Bankrate.com:

  • When a couple in Lawrence, Georgia tried to sell their house, they discovered the HOA had quietly placed a $3,500 lien against their property because the couple had placed some pink flamingos on their lawn. HOAs have no sense of humor about such things as pink flamingos. The lien had to be paid before the house could be sold. Homeowners Associations often place such liens without informing the property owner. It’s not uncommon for homeowners to discover that these “secret liens” have been accumulating interest, attorney’s fees, and collection fees.
  • Maryland: a homeowner who was continually harassed by a neighbor asked his HOA to give him permission to put up a six-foot privacy fence. The HOA refused. The homeowner went to court, spent more than 23,000 dollars in legal fees and still lost. He then put up a smaller fence which he thought conformed to neighborhood rules. But HOA officials armed with tape measures, discovered it was several inches too high. He was slapped with a lien, and spent thousands more to settle the case.
  • A Homeowners Association in Donner Pass, California requires homeowners to make their properties ‘snowmobile friendly’. That means not driving cars over the snow or clearing it from around their homes. The intent is to leave areas open zones for snowmobiles. But a woman who had suffered a serious back injury ignored the rule. She drove her car up her half mile long driveway over the snow, saying her back injury made it impossible to walk the half mile to her home. But driving up her own driveway cost her $500 a day in HOA fines. The dispute eventually cost her more than $50,000 in fines and legal expenses.
  • Tampa Florida, a homeowner committed the ultimate sin of being late on her HOA fees. She thought her attorney had arranged the payment of more than $4,000. But she was short $497. The HOA foreclosed on her property, and sold it in a courthouse auction for $4651. An investor bought it and promptly sold it for $88,000. The homeowner lost her home over the $497 shortfall.

There are literally thousands of such stories across America and there is rarely a happy ending for the homeowner.

Ward Lucas
Author of
Neighbors At War: The Creepy Case Against Your Homeowners Association