Safeguards Necessary to Prevent Theft, Fraud in Condominium, Homeowners Associations

Condominium association lawyers in Miami and throughout South Florida have seen their fair share of fraud and theft involving the officers of local community associations, and the recent case involving the Hillcrest Condominium came as no surprise to the lawyers of Siegfried, Rivera, Lerner, De La Torre & Sobel , P.A. who represent more than 500 condominium associations and homeowners associations throughout the state.

According to newspaper reports about the matter, president Bonnie Andrews Soloman of the building’s association was arrested by local police after bank statements revealed more than $46,000 in unauthorized ATM withdrawals. Appallingly, all of the withdrawals were made at ATMs located inside of the Hard Rock Hotel & Casino and the Seminole Indian Gaming Casino over the course of a year. The condo association has hired auditors to review all of the finances, and the group fears that additional funds may also be missing.

It seems cruel to lay blame on the member of this condominium association who were bilked by Soloman, who they describe as very well liked and seemingly trustworthy and good natured, but the facts of this case point to serious lapses and inadequate safeguards that made the theft possible. First and foremost, associations should not provide their officers with ATM cards for the group’s operating accounts. A credit card for use in case of an emergency where a check is not an option is acceptable, but the limit should be set at less than $1,000. In addition, the checking account for the association should require two signatures from authorized individuals for all checks, and the bank statements should be reviewed by the group’s treasurer, who should provide an overview of the group’s finances at the monthly meetings.

In today’s economy with so many individuals dealing with personal financial setbacks, the potential for theft and abuse by trusted officers of community associations becomes more prevalent. Our highly experienced condominium and homeowners association attorneys will continue to work very closely with the community associations that we represent to help them to implement and maintain all of the necessary precautions and safeguards to help to prevent their becoming victimized by unscrupulous officers and managers.