New Law Providing Criminal Penalties for HOA "fraudsters"

First, let me repeat what I've said before.  The vast majority of HOA board members sincerely try to operate with the entire community&#...

First, let me repeat what I've said before.  The vast majority of HOA board members sincerely try to operate with the entire community's best interests in mind.  Nonetheless, there have been some well publicized  instances especially in South Florida where HOA boards operated what one Miami area newspaper called as "mini dictatorships".  Unit owners in one Miami building watched in vain as "a condo crime family" spent years rigging association elections and even stealing association funds.

Closer to home,  the Tampa Bay Times on February 26, 2017 featured a lengthy article about some   "financial bullying" by local HOA boards that engage in self serving behavior.  A couple of examples: A Pasco County community whose HOA approved a special assessment for new roofs even though an engineering study had shown that most of the existing roofs still had years left of "useful life." In a Tampa high-rise, condo owners were fighting a $600,000 assessment they believe was designed to benefit an investment group that seeks to convert the entire building to rentals.

Not only is such "self serving" behavior clearly unethical but it was illegal.  Florida's Department of Business and Professional Regulation (DPBR) is supposed to investigate alleged wrongdoing by condominium and homeowners associations.  That's a lot of associations as  Florida has approximately 1.5 million condo units that are governed by elected boards made up by unit owners. Unfortunately, it seemed that the DBPR was "ill-suited" and "ill prepared" to handle adequately formal complaints.  At least that was the conclusion of a Miami-Dade grand jury that spent weeks looking into how the DBPR handles complaints.

The panel's report charged that state's investigators were "more intent on closing cases than solving them."  Furthermore, police and prosecutors largely refused to investigate complaints of electoral tampering arguing that criminal punishments were not explicitly mentioned in Chapter 718. The report suggested that instituting criminal penalties against condo HOA "fraudsters" would deter such behavior.
                                 

The state legislature took notice of all the complaints, many of them from residents of  huge condo complexes in South Florida.  It passed this spring a bill that for the first time clarified that various criminal components of Florida state law do apply to condominium HOA board members.   The new law took effect July 1,  Some chief provisions:

• The falsification of ballot signatures, or the theft or "disappearance" of ballots, and false manipulation of condo records can be considered criminal offense punishable by prison terms.
• Condo associations with 150 or more units must publish financial reports on a web page,  to all owners.
• If financial documents are denied to owners in order to hide fraud,the offenders could face felony charges beginning in July 2018.
• Board of Directors members are forbidden from taking payments from the association or hiring their relatives to work for the association.
• Directors are limited to eight years on the board.  However, they can continue in office if they win a super-majority of the votes from owners in subsequent elections.

It seems to me that this law is generally beneficial for the several million Floridians who reside in communities governed by home owner associations.  My one concern is that it could place even more stress on well-meaning board members who are, after all, unpaid volunteers,   It's unfortunate, but one can foresee that the mere potential of criminal liability may deter some good residents from running for office.

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