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Subject: Board Member making Accusations against another Board Member
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HaleyH
(Illinois)

Posts:38


05/01/2019 8:48 AM  
Need advice.
We are a three member board, Pres, Treasurer and Secretary. We are a 17 unit townhome association in Illinois. I am the treasurer. We held a Board Meeting last November 2018 where the Secretary 'announced' that he had found $9,000 in discrepancies in the Financial reports I have shared at prior annual meeting and Board meetings. The President and I asked him to share the detail of how he came to this finding. He was vague and also noted that he wouldn't meet with me but only with the President to share his detail. After the Board Meeting, a week later he sent "Highlights of the Board Meeting" to all members - these were not minutes but a summary of the meeting - which he pointed out there is a $9,000 discrepancy in the finances. The President continued to ask him to meet and then he said it would be illegal to meet only with her.

Fast forward now - I submitted receipts of expenses I paid for: USB stick, Christmas street lights which were placed at front entrance, ream of paper and book of stamps -- $55.02. (We do not have any rules on submitting expenses). Purchases were made Nov 2018 through April 2019. the President reviewed the receipts and approved, I asked the Secretary to review and asked if he could sign my check. He erupted that the receipts were very late in submittal - he is fighting on the reimbursement of the xmas lights (I have email he approved the purchase last Dec. but now he says the purchase was not warranted due to President throwing in her own lights) ... the lights were $20. The latest email to Board, he asked if I was "so in dire poor finances that I may have purchased the lights and then claimed them on my taxes as a donation.' He is questioning if the lights were actually used for the front entrance.

AS I write this you probably are thinking I'm making this up...
Question -- what can we share with other members in regard to his irrational emails and accusations? this is such a dysfunctional group that has had many issues going back many years...I should write a book.
I think his accusations can be brought to an attorney - I think he is unhinged and that this needs to be shared with members and we vote him off the board. (he actually does have some supporters though they don't know this recent issue).



Thanks.
GenoS
(Florida)

Posts:2907


05/01/2019 11:25 AM  
I don't think you're making anything up. I think you need to start playing hardball by the book. Get the official minutes of that meeting in order. What does the president think about all this? He and you can call a special board meeting and demand that the Secretary detail his findings. You present your receipts (you do have copies, I hope) and demand reimbursement for your petty expenditures. Don't entertain any discussion about the Christmas lights beyond the receipt. If the Secretary is unwilling to discuss what he thinks he's found, then you should go over the monthly financials and line-by-line review and announce, "That looks fine to me," and have the president do the same. If the Secretary is being unreasonable, make him own his crazyness in front of others.
JaredC
(Texas)

Posts:214


05/01/2019 11:30 AM  
Get with other homeowners and vote him off the board.

We have EXACTLY the same problem here with a complete nutjob board member. This idiot claims another board member is stealing money yet ignores the past three years of audits that show no such thing. This insane moron demands an audit to be done then literally in the next breath refuses to sign the engagement letter with the CPA firm to begin an audit... this unreasonable waste of human debris is the treasurer.

You want to set than imbecile up? Solicit a board member vote to perform a full audit of the financial records. I guarantee their answer will either be "No" to the audit or they simply won't vote at all.
BobB31
(Florida)

Posts:74


05/01/2019 11:35 AM  
Since these accusations were made in public wouldn't a libel or defamation lawsuit be in order? The board member would not be indemnified against this would he?
HaleyH
(Illinois)

Posts:38


05/01/2019 12:18 PM  
Thanks- I have all receipts - I think he is trying to get me to quit. Last Nov. he suggested a full audit and we all agreed to investigate it.
I started to contact CPA firms and inquire about audits, their expense, etc.
I shared with the Board my findings and then he said I needed to recuse myself from finding the acctg firm.
At minimum it will cost $5,000 and we have about $13,000 in reserves. What a waste of money! WE use quickbooks and the financial reports are provided with a click of a button. We do not provide 'manual' reports which can be manipulated.
Our financials are intact. I think he saw the waste of going down the path of an audit due to the expense. AND if I'm stealing why is he letting me continue as Treasurer?

I agree we need to get smart and show the members his irrational divisive ways.
HaleyH
(Illinois)

Posts:38


05/01/2019 12:52 PM  
Is there an attorney/s on these forums? I would like to know a lawsuit can be brought against this Board member? Or at least send him a letter from attorney notifying him that his actions can be addressed in a lawsuit.
NpS
(Pennsylvania)

Posts:3247


05/01/2019 2:54 PM  
Posted By HaleyH on 05/01/2019 8:48 AM
the Secretary 'announced' that he had found $9,000 in discrepancies in the Financial reports I have shared at prior annual meeting and Board meetings. The President and I asked him to share the detail of how he came to this finding. He was vague and also noted that he wouldn't meet with me but only with the President to share his detail.



Suggestion - Ask the Prez to call a Special Board Meeting on the $9,000 discrepancy. At the meeting, accept and consider all evidence presented on the existence of a discrepancy. If no evidence is presented, then make a Board decision that the matter is closed. Publish minutes of the Special Meeting stating that no evidence of a discrepancy was presented for consideration.

If the Sec refuses to publish those minutes, then the Pres should do it. There is nothing to prevent the Prez from publishing the minutes to a legitimate Board meeting if the Sec refuses to publish them.

If the Sec refuses to attend the Special Meeting, then hold the meeting anyway. At the meeting, go through the motions of requesting all evidence on the existence of a discrepancy. If no evidence is presented, then the same results as above.

The notice to the Homeowners can include a statement that the prior highlights were never approved by the Board, and were found to be false. - Whether they were called highlights or whatever, it makes no difference. Anything coming from the Sec without Board approval is a flagrant violation of normal procedures. Nothing gets sent to the community that hasn't been approved by a vote of the Board.

Posted By HaleyH on 05/01/2019 8:48 AM
$55.02.




Same thing. Hold a Special Meeting. Make the decision. Cut the check. Period. You can do the 2 meetings back to back in less than 20 minutes.

Don't get bogged down by the disruptor. Do your business. Move on.

Je publie un degagement de toutes responsabilite. Read all posts at your own risk.
MarkM19
(Texas)

Posts:310


05/01/2019 6:15 PM  
Haley,
Just a quick reminder when you talk about reserves. They can not be used for anything other than repairs of existing items that are currently in place. Lawyer fees are not a reserve item. Most States have strict rules say that if any funds are approved by the entire HOA to allow the borrowing of reserve funds they must have a payment plan that repays this debt in 1 year.
JimB37
(Florida)

Posts:37


05/01/2019 6:41 PM  
I agree with the other posts. Play hardball. Get all of the facts out in front of the membership. Also, you're being accused of malfeasance and your reputation is at stake. In Illinois, there are two types; one of which does not require demonstration of financial harm. I would make sure all of my ducks are in a row and then contact an attorney. I doubt if this continues once the person gets a letter from an attorney.
JaredC
(Texas)

Posts:214


05/01/2019 6:44 PM  
NpS is correct.

All I can say is don't underestimate the power of lies and stupidity. That can easily overpower any attempts at logic and reason.
MelissaP1
(Alabama)

Posts:8090


05/01/2019 7:48 PM  
May want to point out the rationale of donating and taking off your taxes. I would mention at a meeting that your HOA is NOT a charitable non-profit. That one can't donate money, items, or have a bake sale to raise monies for the HOA. So comments that one can make a purchase and claim it on their taxes are not accurate. You don't want to say "untrue" to indicate he is a liar. You don't want to be on their level or give them reason to spit out more lies.

Raise above this and look about getting them off the board. Find out the process. Your an officer of the board. There are steps to remove you as well. So make sure it's known how that is done. Don't be sneaky about it. Keep it above board. I think that revelation will shock them into inaction. Sounds counter-intuitive but if you have someone who is doing things "behind scenes" it's time to make your own props to the stage.

I went through something similar with a person. He was a complete liar. It was like in his DNA. I knew it and those who experienced it knew it too. However, there was no way I could go around saying "Liar Liar pants of fire" and be a decent believed person. No one believes a person who goes around calling someone a "liar" until they get suckered into that lie.

What did I do? Anything he did that was sneaky and behind my back I'd bring it to the forefront. It was like I was almost 1 step ahead of him. He went around stating I was hiding HOA records. Next meeting guess who shows up with the box full of records and puts them on the board's table. (Mind you they were in the closet in the meeting room). That shut him up and his followers...

So I would bring the budget to the table. We always discussed the expenditures report at every meeting and provided copies. (Collections were for BOARD ONLY). If your open with your information, then one can't hide in the shadows of it...

Former HOA President
GenoS
(Florida)

Posts:2907


05/01/2019 8:30 PM  
Posted By HaleyH on 05/01/2019 12:18 PM
I shared with the Board my findings and then he said I needed to recuse myself from finding the acctg firm. At minimum it will cost $5,000 and we have about $13,000 in reserves.

There is no justification for having you recuse yourself from that vote. Having said that, using your reserves for an audit is very probably a no-no unless you've voted in the past for a reserve account to be used specifically for financial audits.

Posted By HaleyH on 05/01/2019 12:18 PM
AND if I'm stealing why is he letting me continue as Treasurer?

How is he "letting" you continue? It's not his call. At least it shouldn't be. Again, what does your president think about all this?

Posted By HaleyH on 05/01/2019 12:52 PM
Is there an attorney/s on these forums? I would like to know a lawsuit can be brought against this Board member? Or at least send him a letter from attorney notifying him that his actions can be addressed in a lawsuit.

Even if there was one, he or she wouldn't give you a legal opinion over the internet. I'm not a lawyer, but my first inclination to the question is there's rarely a cause of action when the association already has all the tools it needs to handle things without going to court. You can sue anybody for anything, just about, but I think THAT would be a waste of money.

I'm with NpS as well. Call a special board meeting and put the alleged $9,000 discrepancy on the agenda. Make it the only agenda item. If the Secretary refuses to show then immediately after the meeting is adjourned begin the process to get him off the board. Not sure how that works in your state, but I'm sure there's a process to follow.
JoyceR2
(Virginia)

Posts:149


05/13/2019 11:51 PM  
Suggest:

Draft some rules on submitting expenses & have the Board approve paid expenses & amount by motions. Must have a invoice for each expense (not coupled together). It just keeps everyone now & later safe & covered. Spending funds that are outside the ream of budgeted item/reserves can be an issue. Mark (original)receipts paid/date & who it was paid to. These items become property of the association since they were purchased for the association.
SueW6
(Michigan)

Posts:492


05/14/2019 4:00 AM  
Added note: if I purchase anything for the Association, like ink cartridges etc, I get the receipt signed by someone immediately verifying that the item was indeed brought in for use by the group. Then when I submit for reimbursement, the proof is already there that it was a valid and documented purchase.
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