Fraudulent HOAs View bank accounts – 23 have been closed

Of 90 HOA bank accounts implicated in alleged property management fraud, 23 had already been closed and 67 had balances ranging from $180,000 to zero.

NAPLES, Fla. — Nearly two dozen bank accounts belonging to the Collier and Lee community associations suing their property manager for fraud have been closed, meaning the manager emptied those accounts, the associations’ attorney said.

Wells Fargo Bank filed account balances last week in a court-ordered document showing funds as of March 14 in 67 accounts.

But the records list 90 accounts, and Wells Fargo confirmed in the documents that 23 accounts are closed. Of the 67 accounts that remain open, balances range from zero to $180,000; some communities have multiple accounts. One of the accounts opened is for the property management company itself, American Property Management Services; this account contains $51,532.77.

In January, the 35 community condominium and homeowner associations sued Naples-based APMS, claiming the company and its owners had committed fraud with community-owned funds.

The lawsuit claims APMS misappropriated bank accounts used to hold community operating and reserve funds in what the association’s attorney described as a multi-million dollar embezzlement scheme. APMS has denied the allegations, saying in court documents that the associations were aware of and approved of its actions.

The complaint alleges that APMS and/or co-owner Orlando Miserandino Ortiz placed funds in an account at Wells Fargo that only he could access, preventing associations from accounting for their funds or accessing the money, illegally took sole control of Wells Fargo. illicitly or illicitly transferred association accounts and funds for its own use.

According to the lawsuit, Ortiz ordered association officials to sign signature cards for bank accounts but never submitted them to the bank, thereby preventing association officials from obtaining information about their accounts.

Communities are also trying to get further account information, including bank statements, that they have not been able to see.

“They won’t release bank statements to charities without a protective order to keep them confidential,” said attorney Jason Mikes, who represents the 35 communities. “The problem is that associations are like quasi-governmental entities which, by law, must be transparent and give members the right to inspect and copy all records. Therefore, they cannot keep anything secret or confidential. I don’t know why Wells Fargo wants the secret.

Even though the association’s representatives view the account statements, they still cannot access the funds because they were never listed as signatories and a temporary restraining order froze the accounts as part of the lawsuit.

A condo association account at almost zero

The Royal Bay Villas Condo Association is about $600,000 short of its operating fund, association president Laura Rigsby said in an interview. The reserve account was drained to virtually nothing, she said.

“I’m working on calculations now. We desperately need our real bank statements.

Rigsby said once the Wells Fargo link is activated, Royal Bay will be able to see what has been taken. In the meantime, they just had to follow the information provided by the APMS.

“We believe all the statements he provided are fraudulent. But we don’t know that yet,” she said.

Access to communities’ bank statements is essential, Rigsby said, so that communities can be compensated through their fiduciary insurance.

“Right now we’re kind of stuck with proving the loss. We need to have those statements,” she said. “We are in a holding pattern. We have opened a claim (with the insurance company). They need a lot of information. We are getting there.

Rigsby said Royal Bay has remained in communication with residents of its 92 units about APMS.

“We have our own community website and we encourage everyone to sign up to communicate,” she said.

Account balance information released Thursday by Wells Fargo showed Royal Bay Villas had just over $89,000 in the community operating account and pennies over $105 in its reserve account.

The 23 “closed accounts have been emptied by American Property Management Services,” said Mikes, the associations’ attorney. “Clients calculate and send losses now.”

Some communities have had to resort to opening lines of credit with other local banks or levying special assessments to pay suppliers such as lawn and pool maintenance companies.

“We just invoked a special assessment,” Rigsby said. “We have to pay the bills.”

Wells Fargo has confirmed that the bank will provide a link to community representatives. An official said the bank was following the decisions of the Collier County court.

“We are in the process of complying with the court order, which we need to provide the information sought by plaintiffs,” said Gabriel H. Boehmer, senior vice president of Wells Fargo Commercial Banking Communications.

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Shawanda H. Saldana