Board Members Self-Dealing?

My aunt has lived in the same HOA for 30 years. Because of the changing neighborhood, the value of her unit has depreciated tremendously - bought at $250k, units now go for $30-40k. Many units are in foreclosure and being sold for $10k.
My aunt is moving out of the state for other reasons, and wants to rent her unit to a very responsible tenant, who is willing to "rent to own."
The Board is refusing to allow this because they amended the Declaration to say only immediate family members can live in/rent the units.
What has happened is that many owners have abandoned their units, which then go into foreclosure.
Several Board members then buy up these units at $10k and even $5k, , and install their family members.
Is this self-dealing?

OP, the board’s actions may be viewed as breaches of fiduciary duties, which render the board members personally liable for damages. Some states limit the scope of fiduciary duties that board members owe, though.

One solution: have your aunt rent the unit to a family member and have the family member sublease the unit to the tenant. Let the board fight it and she can counterclaim breaches of fiduciary duties, to the extent applicable.

Was the Declaration amended legally (through affirmative vote of the majority of owners) and recorded with the county? Or did the Board just enact a rule? If the latter, then this rule should be unenforceable it modifies the restrictions on the property without owner approval, and you can ignore it.

However, it sounds like that's the least of your aunt's problems. This property is a target for investors, who can buy up enough units to be able to dissolve the condominium structure and then force any remaining owners to either sell their units to them at an unattractive price or pay rent to remain there. (Yes, this is perfectly legal.) It could be that the board members are doing exactly this. Are they buying up units under their own names or under an LLC? That will give you your answer. Is that a breach of fiduciary duties? Maybe not. If the amendment were enacted legally, then they are trying to enforce the current restrictions, which they are obligated to do. They simply may be taking advantage of a bad situation, and I believe they have the same right to buy up units that come onto the market as anyone else. The optics may be bad, but that doesn't make it illegal.

If I were in your aunt's position, I'd unload that sucker as fast as I could and consider it tuition in the School of Life. The last thing I would consider is possible legal action against the board for something that's worth only $40,000 or less.

We have just such a situation now in my HOA. An owner is selling to another party via a Contract for Deed. Appears to be legal in Florida and probably many other states. The contract says that the title will not be transferred to the buyer until all payment terms of the contract are fulfilled. These consist of monthly payments for 3 years followed by a baloon balance payment for what remains on the purchase price.

Until the legal title recorded with the county is transferred to someone else, the current owner remains the "member" of the HOA. The guy buying the house is not the legal owner (yet). Until he is, we consider him a tenant.

That's a good question.

Yes it can be used to get around rental restrictions in some communities but not others. Here is an article

https://www.hoaleader.com//CondoHOA-Owners-Are-Crafty-Another-Way-Try-Get-Around-Rental-Restrictions.cfm

In the governing docs of my community, contract buyers are owners, and contract sellers are seen as just holding interest in a unit as security for an obligation. In other states and communities such as Geno's, it is apparently the opposite.