Condo Board Member Treasurer Embezzles $183,000 – Would you trust those two with overseeing your money?

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This time it happened in a 72-unit condominium in Massachusetts. The Board Member Treasurer did things like writing checks to her contractor son for made up work and none of the other Board Members or owners were reviewing condo records like bank statements. When other Board Members stumbled upon the records years later, the fraud was revealed but it was too late; the money was gone, there was no insurance available and the owners were left without $183,000. It really is important for organizations to have framework, policies and procedures in place for their Boards. Board Members need to oversee …

Serving on Volunteer Boards is Riskier than you may Realize

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Throughout America you’ll find organizations run by volunteer boards.  They’re usually unpaid and overworked, and expose themselves to personal liability as fiduciaries of the organizations.  They have to put their personal interests aside and look out for the best interests of the organization rather than their own self interest.  This is a lot to ask of a person who is donating their time, but this is what is required of a volunteer board member of any organization. Before you take on this responsibility by becoming a board member, you should be sure that the organization is well run and financially sound. While that may …

Illinois Community Association Boards Soon Free to Use Email to Collaborate about A Lot of Topics

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The Illinois lawmakers heard the cry of community association board members who were feeling the bad effects of open board meeting requirements.  Longer, more contentious meetings.  Less informed board members who were afraid of meeting each other in the supermarket and talking about board business for fear of violating the open meeting laws.  Come January 1, 2017, that changes in Illinois. The current laws allow boards to discuss only litigation, employment, rules violations and delinquent owner accounts in closed meeting executive sessions that take place within the framework of a properly noticed meeting open to all owners.  Those categories are not …

New York Condo Board Email Vote Valid If Proven and Ratified

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Board members all over the place.  Immediate vote necessary.  Call an in person meeting, have a telephone call, or vote by email and then ratify the vote at a duly called Board meeting. The Second Department Appellate Court in New York just validated the informal email vote with a follow up later, formal ratification by a condominium Board in 19 Pond, Inc. v. Goldens Bridge Community Association, Inc.. The Condominium Board decided to exercise its right of first refusal with regard to the sale/purchase of a condominium unit.  The Board decision was by a vote by email which the Court recognized was …

Business Judgment Rule Protects Canadian Condo Boards That Observe Best Practices

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Condo Boards in Canada can breath a sigh of relief in that Canada’s highest Court has finally held that the “Business Judgment Rule” can apply to protect condo boards. Read the Canada v. Carleton Condominium Corp. Decision.  Where the rule applies, the high Court held that courts in Canada should give deference to the condo board’s decision. The Court noted that the Canadian Condominium Act makes directors responsible for managing the affairs of the condominium corporation, and requires them to do so honestly and in good faith, while exercising the care, diligence and skill of a reasonably prudent person in comparable circumstances. Christy …

Board Member Personal Devices and Computers at Risk of Seizure

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An adversary in a Florida lawsuit against the Village of Bal Harbour has asked the court to order the Assistant Mayor to turn over her personal devices and computers because there are public records on them and they are entitled to inspect the public records.  Read the Story. Bal Harbour Shops wants the  judge to order the village clerk to confiscate all computers, iPads, smartphones and other devices used by assistant mayor Patricia Cohen to send or receive public records and called for an independent forensic computer expert to immediately copy and inspect the devices.“It is apparent that Cohen is either …

Small Nonprofit Boards Protection

Yes, Small Nonprofit Boards Need Protection Too

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It happened to a nonprofit youth soccer Board in Massachusetts and it can happen to you. The treasurer of Framingham United Soccer Club in Massachusetts took $175,000 from the nonprofit’s bank account and paid his own business and personal expenses. Like many small nonprofits, none of the Board Members paid attention to the bank statements and other organization records and the treasurer kept stealing and stealing. The Board Members could have put a quick end to the thievery if they had anytime and anywhere access to the bank and other records. Read the Story. All too often small nonprofits like …

Boards Should Want To Comply With The Law

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A part of a Board’s responsibility is to make sure that its entity is complying with the law. The Board may decide that professionals should be retained like lawyers, accountants, managers to give advice on how to comply with the laws and in some cases to assist in compliance, but the ultimate responsibility remains on the Board which oversees the entity. If the entity is not complying with the law then the Board has to make sure that that is changed. But what happens if the Board looks the other way. In some instances compliance with the law is difficult. …

Board Management Consistent and Organized is Key

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Boards come in all shapes and sizes and their Board Management is not easy.  Some are self managed and others professionally managed by third party management company.  Community Association Boards often turn to professional property management companies that are charged with managing the community association property but also the Board.  These are two separate and distinct functions of a manager. The trouble is that many management companies are not consistent and organized in their Board management. For example, like any well-run organization, one would think that the community association or any organization’s information, records, communications are all kept within the …

Board Management on Management’s or Board Members’ Computers

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Professionals have been warning Board Management and their organizations for years not to have the Board’s emails, documents and other records on management’s computers. Whether management in house at the organization or a third party professional management company the same risk exists.  If there is a legal records request (private, governmental or otherwise), management’s computers are at risk of being discovered and examined. This may not seem like a big deal but consider how many other bits and pieces of information is mixed in with the Board information.  Now consider how much time it would take to try to parse …