Ny prop management investigated for stealing

Started by JoelC • 3 replies • 1224 views

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JoelC (New York)
Posts: 2

Posted:

Ny habitat mag just posted article about ny management firm investigated for stealing reserve money. No mention of which company. Awful that there is a report but no mention of accused. Who else did they'd steal from. Thoughts.

TimB4 (Tennessee)
Posts: 21,062

Posted:

If Associations are going to use a management company or PM, I'm a firm believer that they should not have full access to the Association money. They should collect, track and deposit the funds. However the Association should be the only ones who can issue checks or transfer funds between accounts. The Account should be set up and owned by the Association, not the MC or PM.

Basically, ask yourself if you would give 100% control of your household finances to an unknown third party. I would expect that nobody would do that. If you won't do it with your personal finances, you shouldn't do it with the Association finances.

JoelC (New York)
Posts: 2

Posted:

I agree completely and would take it a step further. When board members accept the board position they take on a new fiduciary duty to all owners. They not only have a duty to guard the association's money and business records from outsiders like management but also from other board members. They need to keep an eye on other board members and not blindly trust them. I have seen too many reports of board members stealing from their associations. A board member should have access to the association's records whenever and wherever they want. That way they can watch management and other board members and fulfill their fiduciary duty. Thoughts?

RebeccaS1 (New York)
Posts: 20

Posted:

Very good point. I'd like to know which property manager and board was involved. I hope the board members of the building involved decide to change their way of doing business. Board members have to realize that they are running Multi million dollar businesses when they are governing their community associations. Millions in home assets are at risk. If I was buying a home, I certainly would not pick one in a community association where the board was not on top of their game and running the association like they would their business.

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