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Tag: Homeowners Associations

  • Florida HOA Manager Accused of Stealing From Residents

    Florida HOA Manager Accused of Stealing From Residents

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    The former manager of a homeowners association in Florida had her hand in the cookie jar, according to the Pinellas County Sheriff’s office.

    Stephanie Lopez, who managed a 400-unit condo community in Dunedin, was arrested Feb. 7 and charged with one count of scheme to defraud and one count of grand theft, according to a news release. She’s accused of stealing a little less than $25,000.

    Lopez, 56, managed the Mediterranean Manor, in the Tampa suburb, on behalf of her employer, Harbeck Hospitality. Detectives started investigating her last May, after Harbeck notified the sheriff’s department that Lopez was embezzling from the HOA.

    She’s accused of spending the money on expenses like paying her mortgage and bills, buying windows for her home in Oldsmar and Amazon purchases.

    Those alleged crimes are small potatoes compared to a massive HOA fraud that has come to light in South Florida.

    The Miami-Dade State Attorney’s Office arrested five people in November 2022, accusing them of fleecing the Hammocks Community Association out of about $2 million.

    Members of that HOA, the largest in South Florida, said they were “constantly harassed” for cash, with HOA board members requesting “1,000 for this, another $1,000 for that,” said former resident Lourdes Padron. When she and her spouse received an HOA bill for over $4,000, they moved rather than pay it. 

    Hammocks residents who complained of opaque finances allegedly were met with more harassment. When resident Manny Coburn signed a petition to recall the board, the former HOA board members retaliated by prohibiting him from community amenities, he said.

    The investigation into that epic case took five years, and a sixth person was arrested in December.

    Fraud and mishandling of funds runs rampant among South Florida HOAs, according to the hundreds of written complaints lodged against them last year.

    The state of Florida doesn’t watchdog HOAs. State law requires annual audits, but those audits don’t have to be submitted anywhere unless records requests are made. Residents who have disputes can opt to sue HOAs at their own expense but otherwise have few sources of recourse. 

    The Florida legislature took up a bill aimed at tightening regulations last year, in light of the Hammocks scandal, but the law that passed lacked bite.

    “Someone else needs to be the gatekeeper who provides sound judgment to protect an association from running amok,” real estate attorney Josh Migdal told The Real Deal last year.

    —Rachel Stone

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    TRD Staff

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  • Hammocks Receiver Sues Ex-HOA Accounting, Security Vendors

    Hammocks Receiver Sues Ex-HOA Accounting, Security Vendors

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    A year after ex-Hammocks board members were charged with running a massive fraud, the homeowners association’s receiver accused former HOA vendors of playing an “insider” role in the scheme. 

    The lawsuit marks the latest chapter in the Hammocks fiasco. In November 2022, prosecutors charged former board presidents Marglli Gallego and Monica Ghilardi, as well as two other ex-board members, of misappropriating HOA funds by hiring bogus maintenance and other contractors that did no work. When the association paid the vendors, some of the former board members diverted funds to themselves, according to an arrest affidavit. 

    Since then, David Gersten, the court-appointed receiver overseeing Hammocks affairs after the charges, has claimed in civil suits that others, aside from those criminally charged, either turned a blind eye or in some way participated in the fraud. In that, the Hammocks became the first major case in which association vendors are accused of wrongdoing. Although claims of mismanagement abound across South Florida communities governed by associations, most take aim at board members. 

    The Hammocks, which has more than 5,500 single-family homes, apartments and condos, sits on 3,800 acres between Southwest 120th and 88th streets and between Southwest 147th and 162nd avenues. It’s one of the biggest HOA’s in Florida. 

    In the latest filing, Gersten sued Jesus Cue and his accounting firm Worldwide Business Solution; Raul H. Gonzalez-Cortina and his security services provider Off Duty Services of SOFL; and Javier Ceppi and his computer and tech services vendor CompuFix. The three vendors received nearly $2 million, combined, from association coffers from 2019 to 2022, even though they worked against the HOA’s best interest, according to the lawsuit. 

    The complaint was filed in November in Miami-Dade Circuit Court, marking the sixth lawsuit filed by Gersten. Last year, he filed four suits against ex-HOA attorneys and one against non-criminally charged former board members. The case against ex-board members and two of the suits against law firms settled after insurers agreed to tender the full limit of their policies, amounting to a total of $2.8 million in collections from the carriers. 

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    In his latest lawsuit, Gersten claims Cue helped Ghilardi incorporate Albri Consulting, an entity managed by her husband, Dante Chauca, and aided in preparing association checks to Albri. Yet, Cue knew Albri provided no goods or services to the Hammocks, or at least hadn’t seen records showing the entity did any work for the HOA, according to the complaint. Through Albri, Ghilardi funneled association funds to herself and her family. 

    Cue and Worldwide received $637,000.00 from the HOA’s coffers from 2019 to 2022, the suit says. 

    An attorney for Cue and Worldwide denied the allegations, saying they provided legitimate and necessary services.

    “My client came into the Hammocks association, organized their banking records, their accounts, their statements and all the other financial information that was required,” said attorney Lorne Ethan Berkley. “I have spoken with the association’s CPAs who have all confirmed that Worldwide and its principal, Mr. Cue, actually provided these services.”

    As for Albri, Cue created the entity after he was told it was to provide HOA security services, Berkley said. 

    “It was not opened with any particular motive or purpose of ‘funneling association funds,’ which is what it is alleged,” he said. “If that is what was done with it, my client certainly didn’t have any knowledge.” 

    Gersten accuses Gonzalez-Cortina and his one-man firm Off Duty Services of SOFL of providing personal security services to Gallego and Ghilardi, yet receiving $409,883 from association coffers. Ceppi and CompuFix, which received $923,892 from the association, aided Gallego and Ghilardi in falsifying HOA election votes, allowing them to keep their power, according to the complaint. 

    Gonzalez-Cortina and Ceppi could not be reached for comment. 

    Gallego was elected as board treasurer in 2015 and became president in 2017. Ghilardi, who had been on the board since 2016, became president after Gallego was first arrested in 2021 on charges of association theft, according to the complaint. Aside from Gallego and Ghilardi, the Miami-Dade State Attorney’s office charged in 2022 ex-board members Myriam Rodgers and Yoleidis Lopez Garcia, as well as Gallego’s husband, Jose Antonio Gonzalez, who is accused of running some of the bogus vendors. 

    All of those changed have pleaded not guilty. Attorneys for Gallego, Ghilardi and Garcia didn’t immediately return requests for comment. Rodger’s attorney declined comment. Gonzalez’s attorney has denied the allegations against him. 

    “While the outrage of the homeowners is certainly understandable, we believe it is misplaced as related to Mr. Gonzalez,” attorney Jude Faccidomo said in a statement. “We look forward to thoroughly vetting any evidence provided by the state, especially as it pertains to our client.”

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    Lidia Dinkova

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  • Weekly Dirt: Conflict Between HOA Lawyers, Property Managers

    Weekly Dirt: Conflict Between HOA Lawyers, Property Managers

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    An “inherent conflict” exists for attorneys and property managers representing residential associations. 

    The boards at homeowners and condo associations across the state hire professional services firms to represent entire communities. But some owners and residents feel that the lawyers and property management firms cross the line and instead serve individual board members’ interests, Lidia Dinkova reports in The Real Deal’s latest issue. 

    Because many of those contracts provide for a flat fee with extra charges depending on the services, attorneys and property managers benefit from being asked to send threatening letters or by filing lawsuits against unit and homeowners. “The more services rendered, the more fees involved,” attorney William Sklar said. 

    I think anyone living in South Florida has heard of situations or lived in communities where this happens — whether it is based on warranted behavior (breaking association rules) or not. Think about that HOA board member who’s obsessed with tracking visitor parking, illegally towing cars or issuing fines for allegedly leaving your trash can out too long, failing to mow the lawn on time, etc. Beyond those smaller issues, though, are situations like one where an association’s attorney filed a lawsuit on behalf of a former board member against a resident who raised the alarm about potential board misspending. 

    Lawsuits over the massive fraud at the Hammocks, one of the largest associations in the state, also took aim at ex-HOA attorneys.  

    “The management company and the attorneys are afraid that they are going to get fired should they not completely have the backs of the board members, even if they are engaging in wrongdoing,” said attorney Eric Glazer. 

    A lack of state oversight has contributed to the problem. 

    “The statute itself creates a lot of incentives for attorneys and associations to work together against residents,” attorney James Bishop said. 

    What we’re thinking about: Will Malaysian firm Pacific & Orient sell its partially completed condo tower in North Bay Village to another developer active in the area, like Andy Ansin, Harry Macklowe or Jorge Pérez? Send me a note at kk@therealdeal.com. 

    CLOSING TIME 

    Residential: Alex Pirez’s Mocca Acquisitions LLC sold the 13,000-square-foot, seven-bedroom mansion at 4940 Hammock Lake Drive in Coral Gables for a non-waterfront area record of $21 million. The buyer is a land trust. 

    Commercial: New York University paid $33 million for a medical office development site in downtown West Palm Beach, where it plans to move its Langone Health to the property at 324 Datura Street. Morning Calm Management sold the 0.6-acre site. 

    — Research by Adam Farence

    NEW TO THE MARKET 

    1040 South Ocean Boulevard (Studio 910)

    An ocean-to-Intracoastal compound in Manalapan hit the market for $79 million, about four years after it was asking less than half that amount ($35 million). The 2-acre estate, at 1040 South Ocean Boulevard, includes 200 feet of oceanfront, and a dock and boat lift on the Intracoastal Waterway. Maura Ann Christu with Island Realty PB has the listing. 

    A thing we’ve learned 

    Billionaire hedge fund manager Ken Griffin opposes casinos. In a letter to the editor published in the Miami Herald last week, Griffin wrote that “measurable research proves” that casinos lead to gambling addiction, higher crime rates and drops in property values. Developer Jeffrey Soffer has long pursued legislation that would allow him to run a casino at the Fontainebleau resort in Miami Beach, including a push this legislative session. 

    Elsewhere in Florida 

    • The Florida House passed a bill that will allow 16- and 17-year-olds to work longer and later hours (more than 30 hours a week when they are in school, and more than eight-hour shifts). Opponents say it would open the door for the exploitation of child labor and make it more difficult for those teenagers to do well in school, AP reports. 
    • Orlando Sentinel journalists, designers and production workers staged a walkout, joining union members across seven newsrooms in a strike against the paper’s owner, Alden Global Capital, Orlando Weekly reports. Former TRD Miami reporter Amanda Rabines, now a breaking news reporter for the Sentinel, was part of the strike and said having a robust newsroom is “an essential part of democracy.” The employees protested Alden’s refusal to pay fair wages, threat to rescind its 401(k) match, and failure to confront pay disparities. 
    • A judge on a federal appeals court in Atlanta said Florida’s law restricting Chinese investment in real estate “blatantly violates” protections against discrimination. The panel of judges granted an injunction for two of the plaintiffs suing over the law, according to Politico. 

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    Katherine Kallergis

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