Old Management Co. Withholding Records and Funds

Started by MarkH30 • 10 replies • 377 views

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MarkH30 (Ohio)
Posts: 3

Posted:

I just wanted some general input on a matter.
I was told at an open meeting that our new management company did not get any records from our old company. They stated that the old company is essentially also withholding all of our money. Is this legal? Our new management company took over approx Sept 2021 and a whole new board was elected within two months. I am in total shock right now. Nobody knows what kind of a reserve we have and the board just keeps spending money (I assume from any collected monies after the new management company came on board).

KerryL1 (California)
Posts: 14,550

Posted:

Are you on the board?

MarkH30 (Ohio)
Posts: 3

Posted:

I was before all of the changes.

MarkH30 (Ohio)
Posts: 3

Posted:

What does that matter, anyway? I am a paying homeowner that has a right to know on a quarterly basis our financial statements. Which we have not gotten any. Everybody in this community has a right to know where our money is.

BillH10 (Texas)
Posts: 1,217

Posted:

It sounds to me like your issue is with the new MC as well. Frankly, I'm not convinced you have the entire story about the old MC.

If they took over last September, they should have issued at least one quarterly report last year and two this year to date, or at least one for the first quarter. The one for the second quarter should be in the works.

As for the board 'spending money', that is what Boards do. It is your desire the bills not be paid?

SheliaH (Indiana)
Posts: 6,964

Posted:

Were you on the board at the time talk began about changing property managers? If do, did anyone mention preparing a transition plan and how long it might take to complete the process? the bigger the community, the longer it might take, although I would hope you'd be further along if the new community started in September. What did the board said about all this (you did ask them, didn't you?)

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

LetA (Nevada)
Posts: 2,679

Posted:

How can they withhold funds? each of your BOD need to go to the bank with your ID and printout from the secretary of state identifying you as a BOD, you should
already have a signature card on file with the bank and take the PM and that company off the account Monday morning, make that your first priority.

CathyA3 (Ohio)
Posts: 6,299

Posted:

Of course that's not legal. But the two management companies should be able to work through the transfer of records and accounts - this sort of thing happens all the time. If there is a hitch, then at least one of the companies is incompetent and/or unprofessional.

The board's job is to figure out where the hold up is and to talk to the HOA's attorney if they need someone to explain to the PM company/companies the error of their ways. (Way to lose future clients, guys.)

MaxB4
Posts: 3,513

Posted:

The funds are one thing, getting records is something different. I had a situation where a management company wouldn't turn over records and the courts would not step in and help.

JohnT38 (South Carolina)
Posts: 1,631

Posted:

Quote:

Posted By MaxB4 on 07/11/2022 7:21 AM
The funds are one thing, getting records is something different. I had a situation where a management company wouldn't turn over records and the courts would not step in and help.

Wow that's really surprising. Do you know what the courts logic was for not stepping in on the records issue?

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