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Past treasurer-CDs in his name

My HOA has a situation that I don’t know what to do next. I noticed that a CD had been cashed in early based on a bank reconciliation posted on the HOA website. The reconciliation didn’t show the bank statement, just a screenshot and the treasurer’s name. I submitted a records request with the board on September 3rd for copies of the bank statements. I wanted to verify what happened with the funds from the CD that was cashed in. On September 17th, the treasurer resigned and was immediately replaced. The new treasurer claimed to be busy and wouldn’t be able to address my request until after 10/1. I didn’t push this as I wanted answers. On 10/3, the new treasurer informed me that the CDs (totaling about $70k) appear to be in the name of the old treasurer, but she had not been able to gain access to the accounts, so no bank statements yet.. It is an online only bank. The old Treasurer gave her an outdated or incorrect contact number and the bank never responded to her email. The old treasurer was not cooperative with her efforts, telling her the accounts are in the HOAs name and she just needs to contact the bank, it’s her responsibility. On 10/4, the new treasurer resigned without gaining access to the bank accounts. The entire board, for reasons other than the CD issue, have resigned with the exception of one person, who is a snowbird and out of state. I am concerned with the status of the ownership of these CDs. I do not think the new board (which may or may not be appointed tomorrow by the remaining board member) will probably not be willing to fulfill my records request as many other homeowners feel I am being vindictive towards the old treasurer who is sick and dying. I just want answers. Do you have any advice as to what steps I can take next? I do not have any proof that the CDs are actually in the old treasurer’s name, there isn’t a board that can find out this information. Should I hire an attorney out of my pocket to get to the bottom of this? I am out of ideas and need some advice! Thanks!!

1 Response

  1. Dennis Legere

    Mary, This is a very troubling story that should concern your entire community. To have an association account CD in the name of an individual and not the association is a major red flag. Then to have the amount of resignations associated with records request on the financial transaction is another major red flag. This is why we have record request laws. Demand to see the records of the financial transaction associated with the cashing out of this CD and exactly where in the association accounts the proceeds were deposited. The association has 10 days to provide you access to those records or they violate the law. Because a board resigns does not protect them from any criminal or misappropriations of funds and in fact removes any indemnification they may have had as board members. While this may be nothing other than sloppy financial management, I’ve seen far too many actual embezzlements of association funds by board members or community managers if financial management is not robust as is the case with your community. If you do not get answers you have the right to file a petition to ADRE to force the association to provide the requested financial records. If you find evidence of missing association funds you can present your evidence to the local police to file embezzlement charges on the perpetrators of this crime.
    This is a big deal so do not let this ride.
    Dennis

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