Page 14 - Boca Club News - December '22

Page 14, Boca Club News
Legal: Real Estate Fraud

By Michael J Posner, Esq., a partner in accused American Property Management Services of failing to the card can be used for purchases; (iii) random confirmation
Ward Damon PL a mid-sized real estate release Association funds after repeated demand. The company of vendor payments tied to the work performed, to ensure that
and business-oriented law firm serving never gave the Associations access to their own funds at Wells payments are not being made for unrendered services; and (iv)
all of South Florida, with three offices Fargo Bank, effectively locking them out. Even after Wells Fargo careful review of the association’s budget to look for unusual
in Palm Beach County. They specialize was required to disclose the sums in the account, the Associations payments or unusual increases that are not justified by the
in real estate and association law. They were blocked from accessing same as the accounts were created necessary expenses of the Association.
can be reached at (561) 594-1452 or at solely by the management company without including the Owners have the legal right to access and to review
mjposner@warddamon.com. associations as owners thereof. These accounts remain frozen Association financial records. Both the homeowner’s association
In Florida, homeowners and pursuant to a court order. and the condominium act provide that the Association must
condominium associations are private enterprises run by owners In addition to blocking access to their own funds, it appears give its financial reports to its members upon written request.
who may not have any experience operating a business. Some that American Property Management and its principal, Orlando Depending on the budget of an Association, the financial
associations have millions of dollars in expenditures. This Ortiz, stole substantial sums from the Associations to fund his statement will be either a report of cash receipts and expenditures,
confluence can lead to fraud, resulting in a loss of thousands if own lavish lifestyle. As the associations began to pursue their if the annual budget is less than $150,000; a compiled financial
not millions of dollars from bad directors and property managers. claims, Ortiz purchased a 1999 Hawker 800XP business jet and statement if the budget is less than $300,000; a reviewed
An association in Miami-Dade County known as Hammocks began traveling overseas. APMS was evicted from its business financial statement if the budget is less than $500,000; and
Community Association has lost millions of dollars due to a location, and it appears that Ortiz is no longer located in the for associations with budgets that exceed $500,000 an audited
fraud scheme perpetrated by the Association’s president and United States. financial statement.
other board members. It is alleged that board members wrote Preventing association fraud can be difficult because the Reviewing your association’s budget and expenditures is
checks, in some cases for hundreds of thousands of dollars, owners rely on their board members and property managers to one of the obligations of homeownership in a community that
to Association vendors for services that were not performed. handle the financial management of the Association. However, relies on volunteers to operate what can be a multi-million-
These vendors would return the Association money directly to there are some things that Associations can do to possibly dollar business. As for issues caused by property managers,
the board members after keeping a portion for themselves. The limit fraudulent activity. These include (i) requiring multiple it is imperative that directors do not become complacent in
board members would cover their tracks with phony vendor signatures on checks and expense payments, so that one person monitoring the expenses and actions taken not only by their
receipts, so that if they were audited it would appear that the is not able to control the Association funds; (ii) limit access to fellow board members, but by the property management
payments were justified. the Association credit cards and limit the maximum amount that company hired by the board on behalf of the Association.
The Hammocks board vigorously fought attempts to remove
them from office, including bomb threats at a January meeting of Mental Health Memo:
the owners and the rejection of most of the recall ballots from a
July recall vote of the members. The final straw was the attempt
by the Board to increase the annual budget from 3.7 million to When Stress Takes Over
over 10 million dollars a year. That increase resulted in a lawsuit
and eventually caught the attention of the State Attorney’s office,
who arrested several members of the Board of Directors. By Elyce Kiperman-Gordon, MS, Healing Therapist. She can be reached at (844) CAN-HEAL
Debit cards have been the source of losses for many LCMHC, NCC, owner of The Feeling or Elyce@TheFeelingExpert.com.
associations. A large association in West Palm Beach lost Expert , an evidence-based and Disclaimer: Names and identifying characteristics have been
®
over $100,000 due to the President’s use of the Association holistic psychotherapy practice, changed to protect the privacy of individuals.
debit card to fuel his gambling addiction. A property manager located in Boca Raton. She is a Board The Patient: Jeffery, a 59-year-old male, had been in a
in Miami used condominium association debit cards to steal Certified, licensed Clinical Mental recent car accident. He was still very shaken up from the
several hundred thousand dollars. This led to legislation Health Counselor, offering a range incident and was having intense anxiety, panic attacks and
banning associations from using debit cards, but nothing of therapeutic approaches to treat sleeping problems. He was constantly ruminating about the
prohibits an association from having a credit card, which can anxiety, depression, trauma, and accident and having fearful thoughts about what he could
lead to similar abuse. relationship issues. Elyce is an Internal Family Systems
In Southwest Florida, a lawsuit filed by 34 Associations has Specialist (IFS) and a Certified International Integral Sound Mental Health Memo: on page 15

Holiday activities! SAT, JAN 14 • 10AM-2PM

Holiday activities! SAT, JAN 14 • 10AM-2PM

Holiday activities!
SAT, JAN 14 • 10AM-2PM

Holiday activities!
SAT, JAN 14 • 10AM-2PM
Stay tuned for dates and details on
Holiday festivities at the museum.
Stay tuned for dates and details on
• Gingerbread Man Decorating
Stay tuned for dates and details on
Holiday festivities at the museum.
Stay tuned for dates and details on
• Holiday Music Circle
Holiday festivities at the museum.
Holiday festivities at the museum.
• Grinchmas
• Gingerbread Man Decorating
• Gingerbread Man Decorating
• Gingerbread Man Decorating
• Storyteller - Trixie the Holiday Pixie
• Holiday Music Circle A celebration of real heroes, princess
• Holiday Music Circle
• Holiday Music Circle
• Grinchmas
• Fabulous Fun Friday - Holiday Theme book
• Grinchmas
• Grinchmas
A celebration of real heroes, princess
A celebration of real heroes, princess
• Storyteller - Trixie the Holiday Pixie
• Storyteller - Trixie the Holiday Pixie and fairytale characters, and superheroes
reading
• Storyteller - Trixie the Holiday Pixie
• Fabulous Fun Friday - Holiday Theme book
• Fabulous Fun Friday - Holiday Theme book A celebration of real heroes, princess
• And much more...
and fairytale characters, and superheroes
and fairytale characters, and superheroes
• Fabulous Fun Friday - Holiday Theme book
reading
reading Boynton Beach Amphitheatre in Centennial Park
and fairytale characters, and superheroes
reading
• And much more...
• And much more... Boynton Beach Amphitheatre in Centennial Park
• And much more... Come Play Boynton Beach Amphitheatre in Centennial Park
Boynton Beach Amphitheatre in Centennial Park
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With Us!
With Us!
With Us!