A lawsuit was recently filed in Florida against a management company that was, allegedly, somehow able to embezzle multiple millions of dollars from 34 community association clients.
When we first saw this news item, we couldn’t believe it. How could a single management company keep such pervasive and extensive crimes hidden long enough to pull this off?
We work with many reputable managers who deserve the trust of their association clients. But this unfortunate situation is instructive as to the importance of the old adage, “trust, but verify.” Boards of directors must conduct periodic reviews of financial statements and verify that their trust is warranted.