Many SCA residents have been asking, what is the truth about board candidate Frank?

In response, USAF Retired Brigadier General Richard Browning, SCA Mountain View Village, recently sent the following to his personal friends.  And, when we asked, he agreed to allow us to post it for the benefit of the whole community.

—————————–

From: Dick Browning

Sent: Thursday, April 26, 2012 8:13 AM

Subject: SUN CITY BOARD ELECTIONS…

Dear Friends and Fellow Sun City Anthem Homeowners,

NOTE: You have until 4 PM Monday, April 30^th to cast your votes in the 2012 SCA Board Election.  Be sure to deliver you ballots to the voting boxes in all SCA centers.  It is too late to mail them and be certain they will get accepted on time.

If you have not yet voted, I am also urging you to mark #1 on the SCA ballot for the Board of Directors — Bob Frank.

I have known Bob for more than 30 years… the appended brief summarizes that relationship.

I firmly believe Bob is the best qualified among the 7 candidates. His prior service on the SCA Board in 2007 through 2009, and his continued support of community interests since then clearly prove he is a passionate and trustworthy defender of your homeowner interests.

If you have misplaced or need a replacement ballot, please go to the community center with your community membership card as soon as possible (but before noon on April 30), request a replacement ballot, and you can vote while you are there.

If you want more information about Bob and his service to the Sun City Anthem community, please see this web link: http://www.anthemvoice.org/19.html

Dick Browning

PS:  I also encourage you to forward this to your email friends and encourage them to vote this year.  Many residents have waited until this time to submit their ballots.

——-Appended Brief——

 WHY I ENDORSE COLONEL BOB FRANK, USAF (RET.)

FOR SCA DIRECTOR IN 2012

By Brig. General Richard A. (Dick) Browning, USAF (Ret.)

12-year Resident of Sun City Anthem

I volunteered to write this personal recommendation to help overcome the false political smear campaigns waged against Bob during the past few years.

I have known Colonel Robert Frank for more than 30 years.  Prior to discovering that he and his wife Kay were fellow residents of Sun City anthem, I had the great privilege to have served with Bob in Washington DC in the early 1980s.  We were both key staff officers for the Deputy Chief of Staff, Logistics and Engineering, Headquarters USAF in the Pentagon.  

I can testify for Colonel Frank, as I am sure he can for me, that we both had incredibly challenging duties far beyond those normally assigned to officers of our rank and service experience. We were both hand selected for duties where the previous officers had failed to perform satisfactorily.  Bob, then a Lt Colonel, replaced a Brig General who had also served as a major staff director. 

While I had other staff duties, we both presented briefings to the Air Staff Board, the highest level decision making body in the USAF.  Both of us were also required to routinely brief elected officials and their staffs on Capitol Hill as well as meet with various legislative committees and sub-committees of the Congress of the United States. 

In a word, out of the 220+ officers in that Pentagon unit it was my duty as the Executive Officer to supervise, Bob Frank was the “best” among a core of speedy contemporaries!

In my opinion, Bob Frank is one of a very few members of this community who continues beyond all reasonable measures of merit to remain passionate in support of doing the “right and honorable things” for all of SCA.  

In my very humble and considered opinion, ‘No One’ deserves public support by the members of Sun City Anthem more than Bob Frank.

I urge you select Bob Frank, #1 on your 2012 Board Election Ballot.

 ———-

By Sun City Anthem Board Candidate Bob Frank:

“Dick and Rana, as you know, I have always championed the need for full disclosure of community affairs in all of our community media channels. But, when I served on the board in 2007 to 2009, I had direct observations of how the Leach law firm controls board decisions to the detriment of our membership while favoring its profit goals.

Of course, I fully support the postings of committee and board meeting details on action items pending and decided. It is fundamentally wrong and disrespectful to demand that members come to official meetings to find out what is being done with their resources as well as to prohibit meaningful member participation in the decision processes.

Our 55+ community is dominated by those who are still working, traveling or relaxing in a broad variety of senior lifestyles. It is insulting to demand that members come to official meetings to discover what is going on.

And, even when members do attend official meetings, they are not given opportunities to fully and respectfully participate in all aspects of our community governance as equal “share-holders”.

The SCA board’s traditional attitude of “I must allow members to speak, but I don’t have to listen” must be changed.

With SCA’s resources, today’s technologies and a large support contractor like RMI, there can be no excuses for not exploiting extensive web technologies to keep SCA members fully informed 24/7 on all policy, resource and entertainment matters.

There can not be any more excuses for failing in 7 years to do things with web technologies a normal corporation could do in less than a year, or be out of business.

With the funds saved by conducting truly competitive contracting and avoiding such waste as paying millions for unnecessary income taxes, unjustified contractor bonuses and retirement benefits, and hundreds of thousands for unnecessary legal services, SCA could afford to spend a great deal more on convenient web information services to keep members fully informed.

If such a change for the better was implemented by a new board philosophy and supported by a new law firm, forums like AnthemToday could become even more productive by being able to link to many official documents and many director statements when engaged in community debates over what could be best in the future.

Such an open approach could defeat the current negative community environment created by the one blog that the board allows to pretend is the defacto source of board information while getting away with publishing all kinds of deceptive, board propaganda without allowing respectful challenges to its so-called “facts”.

Carl said: “Going back 2-3 years when I was on the Board, we NEVER signed checks for purchases without seeing the backup paperwork, and occasionally checks were sent back to RMI for addition backup before they were signed.   However, even back then payroll backup was not requested. Posted by: carl weinstein “

Imagine that! A former board Vice President has openly confirmed what this entire forum was about…did the Board really NOT require backup evidence for the hundred thousand dollars paid to RMI for its employee reimbursements each month?   How could that ever be justified?

And, imagine the logic behind demanding backup info on say a $90 check, but no backup on a $90,000 confirmation of cash withdrawal? The Treasurer says that was the “agreed protocol” but who in their right mind would agree to such an apparently bogus procedure?

How could such a major financial deficiency be ignored every year in the annual audit reports?

So, when even former director Carl Weinstein openly admits that the board knowingly and willfully failed to accomplish its fiduciary duties in past years when it comes to payments to RMI, what more evidence of the truth is needed?

Why would anyone vote to return any former SCA Treasurer or Secretary who has tolerated such apparent financial misconduct and/or fraud?

- posted by bobfrank on Wed Apr 18, 2012 12:44 pm

Yep!  David Berman and Dan Forgeron have got me pegged RIGHT this time!

They are branding me with “The Bob Frank Method” for doggedly seeking the truth and justice for homeowners as if that is wrong.

Mr. Berman said most recently:
“You can read Forgeron’s statement right here on this blog. It describes how the check-authorization and payroll process adheres strictly to the protocol in the RMI Management Agreement and even contains some controls that go beyond the Agreement. But this isn’t good enough for Bob Frank.“

RIGHT! What was apparently started in 2002 by SCA Treasurer Favil West and IRS-tarnished auditor/tax preparer Lein under the Del Webb Management Company is NOT even close to “good enough” for those of us who care.

The board and RMI wrote the contract terms and conditions to suit their mutual convenience.

They do NOT claim what is contained in their mutually agreed “protocol” fully complies with GAAP.
http://en.wikipedia.org/wiki/Generally_ … es#US_GAAP

Also not said is why the “so-called independent auditor” Lein was never allowed by the board to comment on the apparently flawed RMI reimbursement procedures–as well as so many other accounting issues raised.

See item #5 on this link for details in my (unanswered) board member letter to Auditor Lein in 2009:
http://blog.anthemvoice.org/__oneclick_ … 8feb09.pdf

YES, it is NOT ACCEPTABLE to me (or anyone else who cares about truth) when the board and RMI agree to a “protocol” that appears to clearly violate GAAP and opens the door to embezzlement and fraud.

And, if we are mistaken, Treasurer Forgeron MUST cite the EVIDENCE from GAAP or other rule they are following to prove the board and RMI “protocol” is correct.

Again, calling on professional CPAs and experienced accountants in SCA who know more than those of us posting above!

Do you agree with Mr. Forgeron (not a CPA) that it is “prudent”, legal and according to GAAP to fail to require detailed backup records for reimbursement payments to our financial manager, RMI?

What is the TRUTH?

In past years I have responded privately, but because many of my claimed life experiences have been attacked on the other blog, I am reporting in detail on what I said in this case (and attached the file with illustrations) to try to prevent last-minute campaign distortions or more smear actions.

For example, here are some words from an email challenge I received:

“You list four combat awards. I find that very unusual for a USAF member to earn such awards. I do not question your earning the listed awards. I only question your stating the awards were combat related. I invite you to prove me wrong.”

Some photos and Quotes from my response:

“I was fortunate to be a company grade officer assigned to the Military Airlift Command in field grade positions from 1963 to 1969. I had specific responsibilities for logistics support to the Southeast Asia combat area during 3 assignments in 6 years.”

“The two AF Commendation Medals were for limited performance periods supporting special USAF projects in the 1965-1968 period. I led teams of Non-commissioned Officers and airmen on temporary duty in and around the Southeast Asia combat zone.”

“The Bronze Star was for 2 years of service while assigned to the Military Airlift Command Headquarters at Clark Air Base, Philippines. I served as a 1st lieutenant and captain in a Lt Col position and spent more than half my time in Vietnam and Thailand.”

“The Legion of Merit was for my service while assigned in 1969 as a Captain to the 600th Photographic Squadron at Tan Son Nhut Air Base, Saigon, Vietnam.

My area responsibilities included combat logistics support to 17 USAF units in Vietnam and Thailand maintaining all USAF fighter gun cameras, bomb damage assessment camera systems, combat photographers, motion picture production labs installed in mobile trailers, and hundreds of other complex photo and sound recording systems used in dozens of different AF applications.

My commander advised me after the LOM was awarded that one of the reasons why such a high medal was approved was because I had previously received 2 AF Commendation Medals and the Bronze Star Medal for combat zone area performances.

The next higher service medal available for award in 1969, the Legion of Merit, was partly justified to recognize my previous decorations and sustained successful contributions to so many USAF combat missions over the previous years.

The USAF Personnel Center told me that fewer than 20 USAF company grade officers had received the LOM prior to that time. I was 29. And, in recognition of sustained combat area performances, I was selected for promotion to Major after only 7 years service.”

“Attached are certificates for the LOM and BSM and a photo of my other awards and decorations during my 22-year active duty career.”

Records & Photos of Military Awards
lom-bsm-frank-67-69.pdf

I have previously avoided distributing such private information. Other SCA board candidates have not been equally challenged to produce evidence of their career claims. But, hopefully this is enough to overcome some of the false rumors and negative campaigning I am told often happens during SCA clubs, in the fitness centers, and during restricted coffees for the other candidates.

I encourage everyone to share this with anyone you feel might have been previously misled about my qualifications and fitness to serve well on the 2012 SCA Board.

Bob Frank
Candidate for the 2012 Sun City Anthem Board of Directors

Frank & Stebbins Photo in April 2, 2012 Las Vegas SUN by Steve Marcus

For those who are not be aware of it, the Patrick Coolican article in the Las Vegas SUN featured in both the March 30 and April 2 issues titled “Don’t Question Your HOA or You Might Get Arrested”
http://www.lasvegassun.com/news/2012/ma … -arrested/

continues to get picked up by other publications and national web sites featuring HOA matters.

For example:

1. THE LAS VEGAS WEEKLY(Page 12)
http://www.lasvegasweekly.com/magazine/
http://www.lasvegasweekly.com/news/2012 … t-thing82/

2. THE PRIVATOPIA PAPERS by Dr. Evan McKenzie (Associate Professor of Political Science, University of Illinois at Chicago Adjunct Instructor, The John Marshall Law School, Chicago, Attorney at Law, Consultant, expert witness and author of ” Privatopia” and “Beyond Privatopia“.
http://privatopia.blogspot.com/2012/03/ … t-get.html
http://www.evanmckenzie.com/index.php?o … &Itemid=28

Dr. McKenzie is recognized as probably the top global expert on Homeowner Associations and related government laws and policies. He posted a link to the SUN article for his global audience studying the problems created by abusive HOA Boards and government authorities, and included this personal comment:

“Thanks to Rodney Gray and others for sending me this link. It turned out that Frank and Stebbins were right about the position the IRS would take on the surplus, although that issue, amounting to a tax liability of $1.35 million, is disputed and is still being negotiated. In the meantime, the cops arrested them and they were charged with making a false police report. Say what?”

“Eventually the case against Frank and Stebbins was dropped, but as reporter Coolican says, “This seems to be a curious use of government resources.” What is the nature of the relationship between the HOA board of directors and the Henderson police and city government, that such a thing would happen? Strange days, indeed.
Posted by Evan McKenzie at 7:20 AM”

3. THE SCA-VIEW JOURNAL by Ronald Johnson titled “The Untold Story”
http://www.scaview.org/pages/Today%27sAnthView.htm

4. THE LAS VEGAS REVIEW-JOURNAL, article by John G. Edwards titled “Home Group’s Board Battles” originally posted November 16, 2008 and updated April 9, 2012.
http://www.lvrj.com/business/34543364.html

This article is included because it details the 2007 beginning of false, personal and illegal attacks against me that have continued to this date. The 2007-2008 attacks were vain attempts to try and force me to resign from the board and/or to use the political influence of the SCA Board’s attorney to try to get the State of Nevada to remove me from the board.

But, the boards and David’s Anthem Journal blog have utterly failed to deter me from insisting on ethical board behavior.

The 2007 Board (led by president Mike Dixon and VP/Treasurer Roz Berman) filed 18 willfully false allegations against me with the Nevada Ombudsman Office and the Nevada Real Estate Division.

The bogus charges were detailed within 110 pages of secret, sworn statements on penalty of perjury.

But, after having to spend more than a year defending my honorable name and lifetime reputation of ethical behavior, and after having to spend over $20,000 for expert attorney fees to defend myself against the bogus allegations, I was totally exonerated.

Only people truly fearful of the consequences of public exposure of their misbehavior and conflicted decisions would go to so much trouble to get rid of someone like me. If I had been totally wrong, they could have just ignored me and not worried about the consequences.

So, why post all of these things at this time?

Members are reporting to me that dirty political tricks, smear campaigns and outright lies are heard every day in the fitness centers, in the clubs, recreation centers, and in the restricted coffees–all designed to confuse people and block your access to both sides of community issues.

Contact me for flyers to walk your neighborhoods and proudly tell people you see every day that you are voting for Bob Frank, #1 on the ballot!      bobfrank@cox.net

http://www.anthemtoday.com/forum/viewtopic.php?f=2&t=3766

Bob Frank has filled in the background on SCA’s Community Property Construction Defects as follows:

The details on this very important community milestone need to be checked out. I suspect there is no justification for having a secret board meeting.

As usual, SCA’s business affairs are complex and involve lots of our hard-earned money. The following will try to be as brief as possible, but the situation is not simple. The potential for creating adverse impacts to members linked to construction defects in community property walls (and other areas) is huge.

This meeting comes after about 4 years of association activity involving about $13 million dollars of construction defects agreement negotiations. Our members deserve far more information than has been provided. The way the card notice was handled makes one suspect the board’s planned actions.

If so, it is no wonder the board wants to hide behind closed doors during this voting period. It would be embarrassing to reveal such negative results during the board balloting period.

But, if the deal is fair to SCA, we can be certain the board will be bragging loud and long over its success!

It is a “must read” factual report that names the names and describes the background story that the newspaper would not publish. 

It is important to this community as it indicates evidence of potential serious misconduct by certain past and current directors as well as Henderson employees.

For your convenience, here is a PDF version:  theuntoldstory.pdf

and here is a the link to the online article:
http://www.scaview.org/pages/Today%27sAnthView.htm

The following is what Tim and Claudia sent to their friends:

————————-

“We will receive our ballot for the 2012 election of 3 new board members within the next couple of days.  This is our opportunity to elect qualified people to represent us on the board, those who are dedicated to make Sun City Anthem everything it should be.

In the past we have suffered the embarrassment of huge tax liabilities because past boards refused to return excessive dues, we have witnessed the series of humiliating and expensive restaurant failures, we all have been harmed by wasteful spending.

Enough is too much.

It is the right time to have qualified neighbors on the board that will protect and assure our homeowner rights.

Claudia and I will vote for Forrest Fetherolf, Don Schramski and Bob Frank. 

Although these three gentlemen have no connection to each other, we are convinced they individually bring the qualities we need now – the right people at the right time to do the right job.  We hope you will also support these men of true character.

Mr. Fetherolf brings a wealth of business skills and experience.  He has eagerly pursued fiscal responsibility on various committees and work groups.

Mr. Schramski brings outstanding leadership skills together with the experience and enthusiasm to make positive things happen.

Mr. Frank has continuously demonstrated a commitment to help and support the residents of our community.  We need that more now than ever.  He stood tall in the face of cruel attacks by jealous nay sayers.  The falsities of the deliberate lies thrust at him have now been exposed in the press and he has been completely exonerated of all false charges.

These are our recommendations –vote your conscience but please vote.  Our community prospers only when we all work together.

Tim & Claudia Stebbins”

Some of the facts reported by Nelson Orth on AnthemToday concerning a recent 6-month period included:

“What these memos clearly state is that RMI determines the amount of money per month that RMI is owed, deducts that amount from a SCA bank account, and then asks two board members to rubber stamp that amount.”

“It should be noted that for all of these 13 memos there is not one piece of paperwork justification (e.g. timecards) for the amount determined by RMI.”

 ”The total amount approved by the board for this six month period totals $1,698,295.90.”

“In the December 2, 2011 memo, SCA was charged $164,610.00 for bonuses.”

“I cannot find any contract or paperwork which permits the payment for bonuses to RMI by SCA.”

This sounds like the board has an open invitation to RMI to commit fraud  An emergency forensic audit is required.

And, imagine that Treasurer Forgeron and Secretary (attorney) Gardberg are running to be re-elected to the board!  

This procedure involving millions of dollars should disqualify both of them for continued board service.

Here is the link to the details:
http://www.anthemtoday.com/forum/viewtopic.php?f=6&t=3741&p=7948#p7884

Of course, the confusion is due to disinformation and outright false statements made by current and past board members.  Don’t those board members sound like whining children who have been caught with their hands in the cookie jar?

Why would they take such serious risks and be so deceptive? 

What do we expect from certain individuals who might be seen as desperately trying to avoid being cited for criminal violations of state and federal laws?

For those who are truly seeking the truth, please review the evidence at these links.

1. http://www.anthemvoice.org/arrest.html
2. http://www.anthemvoice.org/taxes_issue.html
3. http://www.garyportercpa.com/index.php?option=com_content&view=category&id=1&Itemid=20
4. http://www.scaview.org/MoreLegal.html
5. http://www.scaview.org/AppealingTaxAuditResults.html
6. http://www.scaview.org/TaxMessOrigins.html
7. http://www.scaview.org/TaxAuditResults-Forgery-FalseReport.html
8. http://www.scaview.org/TaxAuditEatingCrow.html
9. http://www.scaview.org/IRS%20Tax%20Audit%20Results.html
10. http://www.scaview.org/PossibleElectionFraud.html

If all of that is just too much for you to assimilate,  perhaps it would be easier to just accept the IRS Audit results and the IRS denial of appeal.  The debate is over.

And, let us not forget, this tax appeal issue is NOT about “saving money for the corporation.”  NO, it is about millions of surplus dues dollars THE BOARDS FAILED TO  RETURN TO YOU, the homeowners!  

Why would anyone give the board the benefit of any doubt when the boards have been caught secretly withholding refunds from members without authority since 2002? 

This is just plain DISHONEST!  It is a disgusting display of hubris and a flagrant example of disrespect of our community! 

Clearly, the directors have proven THEY CANNOT BE TRUSTED!  It would be a critical mistake to return any of the incumbents to the board.

“Don’t Question Your HOA or You Might Get Arrested!”   
coolicans-march-30-2012-article-on-arrest.pdf

 http://www.lasvegassun.com/news/2012/mar/30/dont-question-your-hoa-or-you-might-get-arrested/

Readers can find copies of:

1. The SUN article,
   
2. Public comments placed on the article web site, and 
3. Our responses to some negative public comments

at this AnthemVOICE site:  http://www.anthemvoice.org/arrest.html

The dismissal was quietly implemented without a court hearing and without prior notice to the defendants or their attorneys.  It just popped up by surprise on the Henderson web site, and the Anthem Journal blog owner somehow learned of it first.

Many members have been asking for more information about the case, and we have posted many of the basic records and supporting evidence on AnthemVOICE (the web site). 

If you take the time to read some or all of those documents, you will discover some truths about the following:

1.   What Frank & Stebbins filed with the Henderson Police Department in November 2009 was TOTALLY accurate, and the original question has yet to be professionally investigated.

2.  Reasonable people with access to the evidence seen on the AV web site could not have fairly concluded that Frank and Stebbins were filing a “knowingly false police report”.

3.  The evidence shows that Frank and Stebbins did not willfully lie to the Police.  That suggests certain SCA board members and their professional advisers have deceived the Police Department for the past two years.

4.  The Henderson Police Department investigation was woefully incomplete, unprofessional, and seriously biased in favor of SCA board members.  The conclusion in the original investigation is now discredited.  

5.  We do not know if those who willfully deceived and knowingly manipulated the City of Henderson leadership in 2009-2012 will be treated in the same way that was so viciously meted out to Frank and Stebbins for such a misdemeanor.  We must wonder if there will be equal justice under the law?   Or, did Frank and Stebbins receive a special version of police and City abuse reserved for political targets?

6.  The Henderson Police Department, City Attorney and the involved Municipal Court Judge can be seen to have seriously failed their public duties.  While most of them have been dismissed, forced to resign or retire or otherwise be replaced in the past year, accountability for such gross misbehavior remains in laps of the elected members of the Henderson City Council who were kept aware of what their subordinates were doing.

7.  The evidence proves there was no “probable cause” for issuing the arrest warrant, requiring bail, and allowing the HPD to strip search, perp-walk, confine in jail for 4 hours handcuffed with arms behind their backs, and otherwise totally humiliate and intimidate Frank and Stebbins.  That abusive behavior authorized by certain individual may be considered criminal violations of state and federal laws by the Attorney General, District Attorney and/or FBI.

8.  Accountability for this case of police brutality and local government abuse of power rests squarely on the shoulders of the Henderson City Council, the staff and a certain Municipal Court Judge that authorized the false arrest warrant.   Few, if any, of the City Council Members will be able to plead a “Pontius Pilate” defense on this case.  Every one in authority at all levels in Henderson knew what was being done was ethically, morally and legally wrong, but no one had the courage to step up and demand it be stopped.

9.  So, the question is,  How do Bob Frank and Tim Stebbins get their good names restored?   And, what accountability will there be in Sun City Anthem for the massive, hateful political actions taken by so many postings on the Anthem Journal   during the past 2 years that materially skewed the board elections and destroy the honest, ethical, lifetime reputations of Bob Frank and Tim Stebbins?   Will the 7,144 members of the SCA community act quickly to help them restore their honor?

10.  And, what about consequences for those dozens of hateful, political attacks by anonymous names posting on Anthem Journal against the many SCA members who dared to admit they were friends (or used to be friends) of the Franks and Stebbins?   Should those anonymous Anthem Journal posters be allowed to remain secret? 

11.  And, perhaps most importantly, should the owner/operator of David’s Anthem Journal escape with no consequences for his thousands of lines of personal attacks that can now be seen to be solely intended to vainly try to protect his spouse from criminal investigations?

This is what Ron Johnson accurately reported in Jan 2010 from a recent Board Meeting:

“Construction defect attorney Roger Grant of Feinberg Grant Mayfield Kaneda & Litt announced today that mediation efforts with Pulte have failed, causing them to file legal action against Pulte for about 13 million dollars.

The firm will be notifying homeowners as well as advising them that potential sellers must make appropriate disclosures that are required by law.”  28 Jan 2010

The  situation is even worse than stated above since the construction defects identified had been known since the early 2000’s when most of the infrastructure was constructed by Del Webb.  Even Sun City McDonald Ranch had collected on similar construction defects by Del Webb.  

It was also known in 2008 that the same sort of construction defects allegedly existed in the perimeter block walls in the community property controlled by the Anthem Council along the Anthem Parkway. But, since Anthem Council was a wholly-owned and controlled corporation of Del Webb/Pulte, the SCA Boards never required DW/Pulte to pay for those millions as well.

Well, it is now March 2012 and the Board and its two law firms apparently have failed to collect even one dollar from Pulte.  

Can you imagine the huge cash value to Pulte for not having pay SCA for so many MILLIONS for so many years?

Follow the money and tell us why the boards since 2007 have failed to collect for so long on such major developer obligations? 

And, if collections and accrued interest for all those millions for all those years is actually being worked and accounted for, why is such vital  information not reported in board reports, in accounting reports, and in the annual budgets? 

IF/WHEN such money is finally collected, how will it be received, accounted for, spent, and what benefits or penalties will it have on the annual assessment levels and income taxes?

By the way, any business person is likely to suspect it is probably a serious violation of generally accepted accounting rules by the Finance Committee, RMI and the Board Officers to hold such receivables off the books and away from member view.

After 4 years of spinning and being proven wrong by the IRS concerning failing to return end-of-year surplus assessments to SCA owners, one would think certain past and current board members would be trying to do the “right thing” and avoid personal litigation risks.  

But, such does not seem to be the case.  Past and present directors seem determined to ignore the case that SCA homeowners have the right to demand payment of the lost/un-returned surpluses since 2002.  Members simply do not have to accept the board’s negligent losses and succumb to unjustified special assessments. 

Members have remedies for dealing with certain director’s and finance committee member’s apparent knowing violations of various laws, statutes and federal regulations.  For example, this week a Sun City Anthem Director incorrectly reported the following concerning the next steps on the SCA 2007 income tax bill for $1.3 Million back taxes and penalties as follows:

“We have 90 days after we receive a note of deficiency — if we receive one.   Since we will not be initiating litigation but rather entering into an administrative appeal, we would not need a vote of the owners. I may have the description wrong but the spirit is correct in our understanding. 

I’m sure if it comes to that point this Board will be sure we have sound advice and impeccable legal standing for whatever action we vote to take.” 

But, the truth (as stated by a national expert on IRS procedures) is as follows:

“All of the process from the examination by an agent to the conclusion of the trial in the US Tax Court is done before tax is assessed.  It must be assessed before collection efforts happen.  I’ll try to break this down into steps:

1.  When the examination of a tax return concludes the agent issues a Revenue Agent’s Report (RAR).  The taxpayer can agree and pay the tax.

2.  The cover letter to the agent’s report says, “If you are not in agreement you have thirty days to file a protest”  you file that protest and it, along with the RAR, go to the Appeals Division.

3.  You make your presentation to Appeals and at the conclusion the Appeals Officer informs you of his/her decision at which time if it supports the agent you have the option of paying the tax!

4.  If you do not indicate your agreement with the Appeals Officer a report is issued with a cover letter.

5.  The cover letter says you have 90 days to agree and pay the tax or….. file a petition with the US Tax Court.  If you don’t voluntarily pay and don’t file a petition within the 90 day period you will be considered to have waived your right to take the matter to the Tax Court, the tax is assessed and collection procedures ensue.

It is interesting that the first thing that is checked on a petition is “was this timely filed”.  People tend to put this off… if filed on the 91st day it is too late and the tax is legally assessed and collected.

These are the steps in the process.  The time limits are only on the taxpayer not the government.

As you have seen when this examination was concluded the board was required to enter their disagreement (request for an Appeals hearing) within 30 days.  It was about six months before the government got around to scheduling the Appeals hearing.  

Now the confusion.  The Appeals Officer has informed the board that their appeal was denied, the Revenue Agent’s position is being sustained.  Apparently the AO stated it would be about three months before the “90 day letter” would be issued.  It could take five or six months…. there is no clock ticking on the government.  I know this seems like a long time but the step is a statutory… but clerical step.  It’s just waiting to be typed up.

When the 90 day letter (statutory notice of deficiency) is issued, the taxpayer will have ninety days from the date of that letter to either file their petition with the Tax Court or they will be considered to have waived their right and the tax will be assessed.  If not received timely it is not given notice by the Tax Court and waiver is presumed.

The same process has been in place since around 1929.  If you think it’s a little out of date….. it is! “

So, why would board members still be trying to pretend there is still hope to beat the IRS in tax court and claim they do not have to get membership approval via a ballot before being legally allowed to sue the IRS?

In case you missed it, check out Ron Johnson’s comments in this regard.
http://www.scaview.org/MoreLegal.html

Why are at least some of the new directors not rushing to pay what is owed and trying to minimize further taxes and penalties by making all of the required amendments to previous tax returns?  Could they have been threatened to keep their mouths shut or risk legal action from the old board members?

Can all of the past and present directors truly believe they all can avoid possible federal tax fraud charges in the future?  Historically, trying to bluff the IRS when you have a bad hand is not smart.

Are some directors just so hung up with their egos they are incapable of knowing the truth, or do they truly not care how much of our hard-earned money they waste?   Perhaps it is both?

We will continue to receive such grossly disrespectful treatment as long as we tolerate it.   And, as competent real estate professionals can advise, failure to disclose to potential buyers the details about the many unresolved SCA financial problems can create significant liabilities to sellers.  It can also impact the declining property values resulting from sustained SCA board misconduct.

It also means that tens of thousands of dollars for interest and penalties accumulating since the audit as well as the estimated $100,000+ paid to the “expert legal team” to process the appeal have all been wasted.

Here are the words from SCA Board President/Attorney Long’s announcement:

“IRS appeal denied. We received notice late last week that the IRS Appeals Officer assigned to our Association’s administrative appeal of the 2007 tax audit has denied our appeal and upheld the findings of the IRS examiner. We expect the IRS to issue a statutory notice of deficiency within the next several weeks. After this occurs, we will have 90 days to file a petition for judicial review of the IRS decision. We have asked the Ad Hoc IRS Audit Task Force appointed at the May board meeting to recommend a course of action for consideration at the February board meeting.“

For our reader’s convenience, we would like to recommend for review a series of comments on that matter posted recently on Rana Goodman’s forum at this link:

http://www.anthemtoday.com/forum/viewtopic.php?f=21&t=3552

An Anthem VOICE founder, Kay Frank (and former IRS Auditor) added the following comments to the above link:

“I can find no evidence that the IRS has ever been reversed on this statute after forty years.  Jack Troia called that “old” law, but competent attorneys call it “settled law”.

The IRS has pulled the records for the ensuing years.  Although they have not addressed them yet, they will–especially since we lost the appeal.  The best chance is to pay up and try to cut a deal on the ensuing years.

An expression of good faith is to show a reduction in 2012 dues by immediately crediting accumulated surpluses instead of forcing a net increase in assessments for 2012.   The boards have never accounted for the millions of unreturned surpluses and we must demand a clear accounting for the whole amount by the new auditor.

Homeowners are not forced to make up for the financial failures of the boards.  The board and/or a SCA homeowner coalition should seek recovery of all reported to the IRS accumulated surpluses from the insurance of our accounting firm, law firm, RMI and SCA liability insurance.   We do not have to accept punishments for the board’s willful failures.

Norm (McCullough) quoted Carl (Weinstein) as citing (Auditor/Tax Preparer) Gary Lein’s reservations about the return–however, they both are individuals who signed  and/ voted approval of the return.  In my opinion they have even more responsibility since they have self-admitted their lack of assurance that they were correct, but signed anyway.

When the current president of the association made a nasty personal remark about the IRS auditor at a board meeting, he was just asking for the IRS to show no leniency.  The least a SMART lawyer could do is keep nasty opinions private.

…just a few of my thoughts.

Kay ”

But, by hiding behind the “so-called” Business Judgement Rule (BJR), HOA directors are told they can get away with almost anything (short of flagrant embezzlement) and not be held personally accountable.

So say association attorneys John Leach & Ed Song, auditor/tax preparer Gary Lein, community management company contractor RMI (headed by CEO Kevin Wallace), Nevada Real Estate Division Administrator Gail Anderson, and the NV Commission for Common Interest Communities and Condominiums (7 members appointed by the Governor from the HOA trade association (CAI) including 3 with obvious Sun City Anthem board conflicts of interest–auditor Gary Lein, Del Webb/Pulte executive Randolph Watkins and 6-year SCA Board Treasurer/President Favil West).

However, while directors are expected to consult “professionals” when making their board decisions,
the NV Attorney General has notified directors that corporate laws prohibit them from blaming the professionals for providing poor and/or illegal advice.

The obvious conclusion is that individual Sun City Anthem Directors are personally responsible for their past mistakes and toleration of financial misconduct, law violations, income tax fraud, community property losses, contractor failures and over-charges, and cruel abuses of community members without justification and without following due process rules. 

It is truly illegal and immoral for current directors to refuse to deal with past gross financial errors which can be corrected  on behalf of our members.

Special accountability for fraud and abuse rests on the backs of SCA Presidents since 2005.   The SCA contract with RMI grants exclusive/sole authority to the SCA board president to direct all RMI employee and related contractor actions. 

In other words, board presidents are the first persons to be held personally accountable for board wrong-doing and gross negligence.  Second in the accountability chain under corporate law would be the Board Treasurers and Secretaries   Actions to enforce accountability should start with those officers.

But, what can be done?  Have any of them committed real crimes as described in Nevada Revised Statute (NRS) 205?   Read the laws for yourself from this online record and see what you think.
http://www.leg.state.nv.us/nrs/nrs-205.html

It is clear that if the evidence showed a director used a lethal weapon (such as a gun or knife) to threaten one or more SCA members to give up hundreds of their dollars, such a director could be charged and convicted under felony crimes for armed robbery and theft.

But, if the same director exploited HOA rules and hid behind the BJR to force members to pay exorbitant annual dues so the money could be wasted on untrustworthy sub-contractors where board members might receive hidden benefits or kickbacks for themselves, could they not also be held accountable by law enforcement agencies for what seems to be similar felony crimes?

We have hundreds of highly experienced members of this SCA community including some currently elected to positions as Clark County and Henderson Judges. 

No doubt such expertise could be used to find ways to enforce accountability–if such professionals would do their duty and stop looking the other way while crime flourishes all around us.  

If you know of such professionals in the financial, legal, and law enforcement businesess, please approach them and ask them to get involved–for their own sake as well as the whole community’s lifestyle and financial future. 

And, in the process, remind them that ignoring such crimes only encourages more of the same….

Look at the following chart for some basic evidence (extracted from page 53 in the report) of the serious privacy violations possible with such devices.   

Imagine if a smart meter was reporting to Nevada Energy every few minutes or less on what power you are consuming.  Imagine if it was easy to detect what spikes are generated by what kinds of appliances.  Would it not be easy for criminals to discover when a person normally takes a bath or showers or sleeps or works or is away for hours, days or weeks at a time?  

And, why would you want to allow the power company to detect, collect, report, store and analyze such personal and private information about you, your family and visitors?  Is there anyone who could truly believe the power company could be trusted to have and keep such private information collected every few minutes of your future life?  It seems crazy to me for them to even try to bully us into accepting such an outrageous concept!

The report is two years old, exceptionally detailed, and appears to provide devastating evidence in sworn testimony by national experts against the safety, security, health and privacy claims by Nevada Energy for its Smart Meter Program.

Unless the owner, resident or visitor grants specific authority for such wire-tapping/unauthorized surveillance actions by the power company, there are major law violations being planned by the smart meter program.  Is this not conclusive evidence of fraud and other crimes by the PUCN and NV Energy?

Clearly, this Attorney General/BCP report proves that customers must be allowed the right to Opt-In.  And, if choosing to refuse the smart meters, they must not be required to pay a penny (directly or indirectly) for anyone else’s decision to use the smart meter programs.

This is not the only damning report against the smart meter program by the Bureau of Consumer Protection.  After you have read this and the other reports, you may want to participate in the efforts to demand that the Attorney General and the Governor direct the District Attorney to investigate why the PUCN’s smart meter program is being allowed to be implemented.  It is outrageous.

Meanwhile, we all need to be meeting with the BCP and getting more facts before the PUCN January 18th hearing about the apparently bogus/illegal “opt-out” proposal by Nevada Energy.

In conclusion, the enclosed BCP report and related evidence is clear.  There are no legal or economic justifications for implementing a smart meter program in Nevada.   No matter how much money has been wasted to date, we simply can not allow hundreds of millions more being wasted while our privacy and constitutional rights against unreasonable surveillance are willfully violated by the State. 

This smart meter program must stop.  All citizens have obligations to themselves and their families to tell the Govenor to terminate it immediately.

Our initial concerns have been validated.  Some HOA statutes and regulations clearly deny constitutional rights to property owners/share holder members of homeowner associations.  The evidence suggests that such violations and statute defects have been crafted by the state and local government agencies and trade association to enable both the government agencies and the HOA business interests to obscenely benefit from their controls of HOA boards. 

As a result, there are no “fair dispute resolution” processes available from the NV Judicial Branch.  The HOA situation is a case of a decade of truly shameful actions by the Executive and Legislative Branches, and shameful neglect by the Judicial Branch.

Anthem VOICE has documented many examples of such misconduct over the years, and more cases will be reported on in the near future. 

Meanwhile, the following article by George Staropoli in AZ is one of many available at his site showing how tens of millions of trusting and apathetic HOA members have been allowing themselves to be “farmed/milked” of their hard-earned savings, retirement funds and American freedoms.

Evan McKenzie is another nationally-recognized author reporting on the shocking losses of constitutional rights and democratic practices due to unfair/dictatorial HOA laws and regulations.  (http://www.evanmckenzie.com/)   His list of current major HOA problems and necessary actions are quoted here:   Dr Evan McKenzie Quote

———-QUOTE———

Link to this Article & Website:  http://pvtgov.wordpress.com/2011/12/30/2783/

“HOA-Land — the failure to democratize

QUOTE

Note: The following is an excerpt from my paper, “Are the American people rejecting democracy at the local level?”

HOA-Land — the failure to democratize

Will the acceptance of authoritarian private local governments in the US result in a weakening of democracy in America, and destroy “one nation, indivisible, with liberty and justice for all”?  

“Democratization” describes the processes underlying “the emergence, the deepening, and survival of democracy” in a society.  Democratization is also concerned with the forces that affect the sustainability of a democracy.  And that’s the issue before us:  Has the First American Experiment with representative democracy succumbed to the “emergence and acceptance of a quiet innovation in housing,” the Second American Experiment? This New America of HOA-Land?[i] 

In his “Theories of Democratization”,[ii] Christian Welzel presents a case well applicable to HOA societies.  Welzel believes that, “Democratization is sustainable to the extent to which it advances in response to pressures from within a society.”  It appears that HOA-Land dwellers feel no need to pressure for change, just like Mayer discovered with his interviews after WW II.

People power is institutionalized through civic freedoms that entitle people to govern their lives, allowing them to follow their personal preferences in governing their private lives and to make their political preferences count in governing public life.

Since democracy is about people power, it originates in conditions that place resources of power in the hands of wider parts of the populace, such that authorities cannot access these resources without making concessions to their beholders. But when rulers gain access to a source of revenue they can bring under their control without anyone’s consent, they have the means to finance tools of coercion.

 The above amply defines the dynamics of political machines and power cliques that operate, more or less, within all HOAs from benevolent dictatorships to rogue boards. And with respect to voting as the sole indicator of a democracy, it is well known that HOAs are woefully deficient in fair and just elections, with no “fair elections” laws in effect. Welzel goes on to say,

Many new democracies have successfully installed competitive electoral regimes but their elites are corrupt and lack a commitment to the rule of law that is needed to enforce the civic freedoms that define democracy. These deficiencies render democracy ineffective. The installation of electoral democracy can be triggered by external forces and incentives. But whether electoral democracy becomes effective in respecting and protecting people’s civic freedoms depends on domestic factors. Democracies have become effective only where the masses put the elites under pressure to respect their freedoms.

 Once again we are told that there’s a need for pressure from within, from those living in HOAs, to uphold their Constitutional protections.  Even if state governments decide to enforce constitutional protections and the equal application of state laws, it remains with the HOA-Land residents to defend our system of government.  Welzel reaffirms this essential requirement, “It is only when people come to find appeal in the freedoms that define democracy that they begin to consider dictatorial powers as illegitimate.”

 Welzel offers a path to victory to stop this erosion of democracy within America that is highly applicable to the social movement for HOA reforms.

 As social movement research has shown, powerful mass movements do not simply emerge from growing resources among the population. Social movements must be inspired by a common cause that motivates their supporters to take costly and risky actions. This requires ideological ‘frames’ that create meaning and grant legitimacy to a common cause so that people follow it with inner conviction.

This is why values are important. To advance democracy, people have not only to be capable to struggle for its advancement; they also have to be willing to do so. And for this to happen, they must value the freedoms that define democracy. This is not always a given, and is subject to changes in the process of value transformation.

 And what about our elected officials?

However, although Welzel writes that “elites [those in power, the cliques] concede democracy even in the absence of mass pressures”, it is only “when these elites depend on the will of external powers and when these powers are pushing for democracy.”   But, with respect to HOA regimes, Americans cannot accept this state of affairs by state legislatures, especially not with respect to these fundamental issues of democratic governance — the very soul of this country.  The absence of legislative support, sua sponte (on their own), for HOA reforms throughout the country is inexcusable! 

UNQUOTE

Here is the leading graphic for this web article.   See quote below concerning why this writer accuses the power companies and PUC of “extortion”.   Since this article has been up since October 2011, the very serious allegations made must ring true or he would have had to remove it.  Here is a link to the entire (copyrighted) article from which some excerpts and the graphic are quoted below.
http://ppjg.wordpress.com/2011/10/03/cpuc-and-pge-misinformation-misrepresentation-and-attempted-extortion/

So, if you have been ignoring what is happening in the world concerning smart meters, then you might want to think again. Massive backlashes against smart meters is a global phenomenon.   Nevada is just late to the “party” and most of our citizens are just too trusting of those in power.  Searches about “smart meters” reveal thousands of very useful articles.  Here is one that summarized the whole situation.
http://morphcity.com/home/104-smart-meter-slavery

For example, see this Canada Free Press article reporting on Nevada public testimony in opposition to smart meters.  See the included quote from Anthem VOICE’s Bob Frank that was ignored by the Nevada media.
http://www.canadafreepress.com/index.php/article/43248

Here is a report on members of the Maine Legislature who are championing the removal of the “mandatory” claims by Maine’s power companies.  The word “extortion” also is mentioned in Maine.
http://www.seacoastonline.com/apps/pbcs.dll/article?AID=/20111113/NEWS/111130338/-1/NEWSMAP

And, in case you  missed it, recently there was a near-riot in CA when a group of elderly women paid to have their “mandatory” smart meters replaced with the old analog meters and PG&E cut off the power to the participants.
http://stopsmartmeters.org/2011/12/13/pge-shuts-off-power-to-sickened-families-2-weeks-before-christmas/

And, finally for today, here is what conservative talk radio host Dr. Mark Levin had to say about “smart meters”…
http://www.youtube.com/watch?v=W_XG25YKRGc

———————-

Mike Hazard

on KDWN, AM 720, Sunday evenings from 7:30 to 8 PM has continued to feature HOA Issues and Solutions Program as moderated by Anthem VOICE’s Bob Frank during the past few months.

The December program will be tonight, December 11, 2011 at 7:30 to 8 PM.  Ray Grant and Bob Frank will be interviewing
Nevada Assemblyman Lynn Stewart (District 22) 

and Nevada State Director of  Business and Industry Terry Johnson

Assemblyman Stewart has earned great respect from Nevada homeowners as a champion in support of legislation and services to help protect HOA unit owner property rights.

Director Johnson was appointed by Governor Sandoval to lead the Business and Industry Department.  One of his major responsibilities is to directs the activities of the Real Estate Division, led by Administrator Gail Anderson, where all NV Homeowner Association policies, procedures and justice processes are managed.

During tonight’s December 11th program, the focus will be on matters of concern to Nevada HOA unit owners and what improvements can be envisioned for the future.   Discussions will focus on the increasing numbers of HOA board abuses of authority and the many concerns raised by the FBI’s 4-year investigations into Nevada HOA fraud and abuse.

KDWN is at AM 720 and live streams over the Internet at this link:
http://www.kdwn.com/streamer/

Sound clips of the December 11 program will be mounted on this site in the near future.

————–previous info—————-

The October 9, 2011 program featured Sun City Anthem HOA unit owner Tim Stebbins and Calico Ridge HOA unit owner Dr. Gary Soloman, PhD.   

Tim Stebbins responded to questions about critical HOA management problems and reported on his experiences with Nevada Real Estate Division failures to provide fair and balanced support services to both HOA unit owners and HOA board members.

Dr.  Soloman reported on his professional research and experiences concerning health problems caused by abusive, dictatorial HOA Boards and explained his rationale for putting up billboards on the freeways around Las Vegas such as illustrated below.

See the previous Anthem VOICE article for more details.
http://blog.anthemvoice.org/2011/03/31/could-living-in-an-hoa-be-hazadorus-to-your-health/

In November, Bruce Baxter from a HOA North of Las Vegas and Bob Frank were interviewed by Ray Grant on topics that elaborated on the points made during the October program.   11 sound clips in MP3 format from the November 13, 2011 program are attached at the end of this article.

—————-

Here are the sound clips in MP3 format from the November 13th program.

1-13nov11-hoa-kdwn.mp3
2-13nov11-hoa-kdwn.mp3
3-13nov11-hoa-kdwn.mp3
4-13nov11-hoa-kdwn.mp3
5-13nov11-hoa-kdwn.mp3
6-13nov11-hoa-kdwn.mp3
7-13nov11-hoa-kdwn.mp3
8-13nov11-hoa-kdwn.mp3
9-13nov11-hoa-kdwn.mp3
10-13nov11-hoa-kdwn.mp3
11-13nov11-hoa-kdwn.mp3

http://www.businessweek.com/magazine/the-king-of-all-vegas-real-estate-scams-12082011.html

In the meantime, it remains a mystery why so many Sun City Anthem unit owners continue to ignore the signals of our board and sub-contractor misconduct.  How many times have you heard a resident say “Oh, I can’t believe any of our board members or community managers could be involved in crimes!  They seem like SUCH nice people….”

Of course they do–seeming like a “nice person” is a key characteristic of a confidence artist.  See this link:  http://money.howstuffworks.com/con-artist.htm

“You might think you can spot a con artist because he’s someone you instinctively “don’t trust.” But the term con artist is short for confidence artist — they gain your confidence just long enough to get their hands on your money. They can be very charming and persuasive. A good con artist can even make you believe he is really an old friend you haven’t seen in years.”

Has Sun City Anthem been bilked by fellow homeowners and the commercial partners?  What do you think of the following list of apparent losses of millions of dollars by SCA boards since 2005?

1.  Developer non-payment of hundreds of thousands of dollars due to rejected reserve studies in 2006, and developer refusals to pay for reserve study shortages identified by the board’s “look back” reserve study in 2008.  Why has the association attorney failed to protect the financial interests of the association while the developer profits from not having to pay its obligations?

2.  Board failure to collect over $250,000 due from the Trumpets Lease in 2006 and 2007?  Why did certain former SCA board members assist the failed lessee escape having to pay for unpaid lease funds and repair of the heavily damaged  SCA restaurant facilities after being evicted in 2008?

3.  Why did the 2005, 2006, 2007 and 2008 boards fail to collect the $1.3 Million owed by the developer for the 2002 Co-Gen Contract Deal?

4.  Why did the boards accept the association attorney’s advice (originally appointed by the developer) to wait until the statute of limitations had almost expired before filing a claim for about $13 Million?  How much has the developer saved in interest and cash flows since 2005 by being allowed to endlessly delay the very large payments for missing reserve funds and construction defects obligations?

5.  Why did the boards and the association attorney allow the developer to deliver an incomplete facility for Recreation Center #3?   How many hundreds of thousands of dollars have SCA members been bilked out of while the board spent member assessments to finish the building?

6.  How much was added to the developer’s profits as result of not having to pay for the unneeded “Green” features and not having to deliver a completed facility?   How much was added to the sale prices of thousands of SCA homes built after the 2002 change in the Anthem Master Plan to pay for the 3rd Recreation Center that the developer failed to spend on its construction?  Why did the boards, association attorney and community management company allow SCA members to seem to get bilked in this way?

7.  Why have the SCA boards, Finance Committees, and Tax Preparer/Auditor played high risk games with the Internal Revenue Service by failing to return millions of dollars of member surplus assessments each year as they claimed to have been doing?

While there are many more signals that something is very wrong with how our association has been managed since 2005, the biggest mystery is why so many members ignore the obvious?  Tolerating such apparent gross negligence and mismanagement has only emboldened the leaders to become more open in their apparent misconduct.

However, it must be remembered that:
(1) the IRS delivered an audit in 2010 claiming SCA Directors had violated federal income tax regulations in 2007 (and possibly since that time) and about $1.3 Million was owed in back taxes and penalties; and
(2) a former SCA Community Manager employed for over 20 years by Del Webb/Pulte/RMI was recently convicted of willfully and knowingly violating State Laws. 

Both cases indicate that State and Federal criminal charges might eventually be filed against certain individuals for what appears to be serious law violations. 

Although new SCA Directors have been consistently advised by the attorney and community management company to never look back at past board failures, it is becoming increasingly clear that waiting for the FBI to look into some of these matters is the worst possible strategy for the individual directors as well as our homeowners. 

Where the FBI has gone into HOAs, the property values have tended to sink below average.  It is our member’s fault if we sit by and allow that to happen in this “paradise”.

See:  http://www.youtube.com/watch?v=Ug75diEyiA0

Our AnthemVOICE article dated March 7, 2011 reminded Sun City Anthem members that the SCA Board’s 2009 Federal Tax Returns had reported $4.8 Million of untaxed and un-refunded surplus member dues held in a working capital (slush fund) account.  

Here is the page from Sun City Anthem’s 2009 budget planning presentation reporting the $4.8 Mil. surplus.
http://blog.anthemvoice.org/__oneclick_uploads/2010/07/surplus-build-up-2002-2009.pdf

But, when Finance Committee Chair Candance Karrow was asked during the November 2011 Annual Membership Meeting why assessments were being increased by $714,400 in 2012 when there was such a large accumulated surplus account balance, she stated that all of the surplus had been spent. 

When asked “what for” she just shrugged her shoulders, and claimed she did not have the details!  Even worse, not a single board member was willing to answer the obvious questions about the missing millions of surplus funds.

Imagine a corporate board and its finance committee responsible for the assessments, collections, accounting and spending of a 2-year total of $16 Million of member assessments plus an additional $4.8 Million for expenditures of unidentified “stuff” and they have refused to explain such outrageous over-expenditures!

Imagine that all seven board members, all community managers, and the association attorney  just sat there and said nothing to help Ms. Karrow explain where the missing $4.8 Million had gone! 

And, imagine that the former board member and disgraced attorney tried to misdirect the audience from the hard questions during member comment period by reminding people of the 4th quarter 2008 “$100 dues holiday”. 

Anyone who can use simple math can readily see that such a $100 reduction in the 2008-mandated $160 increase in annual assessments had absolutely nothing to do with the reported $4.8 Million surpluses carried over and declared during the 2009 budget year.  In fact, one has to wonder how in spite of the $714,400 “dues holiday”cut in 2008 assessments it was possible to report an increased total of $4.8 Million accumulated assessments a year later in August 2009!

Come to think of it, one has to wonder what kind of serious conflicts of interest that man might have for so often seeming to work to cover up the mismanagement of past and present board members?  Year after year, on advice of counsel and RMI, the boards have refused to clean up the past financial disasters while the former VP creates smoke screens and misdirections to keep members confused about the essential facts.  As many say, follow the money through independent forensic audits, and we will find the truth.

So, where’s the “beef” (missing surplus funds)?   Since embezzlement has been found so often in national HOAs and during the current Nevada FBI investigations of HOAs, prudent/ethical people will not allow such major questions involving apparently missing millions of dollars to go unanswered.  Honorable directors cannot continue to tolerate such obvious signals of past and current financial mismanagement.

Even if the boards can eventually prove they legally and properly spent all those millions in such a short time in such secret ways, how will they explain away the apparent waste and abuse of funds that were required by federal and state laws to be refunded to our members?  It is absolutely required that the boards return those millions of surpluses or ask the members to vote via formal ballots to authorize the boards to pay the income taxes and spend the resulting funds on clearly identified capital improvement projects.

Considering the FBI’s ongoing investigations, this matter would seem to be an extremely high priority for the board to resolve.  Each serving director in recent years could face criminal allegations if nothing is done.  It will be truly painful for all directors and SCA members if we wait to act until the FBI announces an interest in SCA’s financial and board election affairs.  Out of self-interest, our members must stop ignoring the obvious signals of serious problems.

———————-

FYI:   For those who have not been following the “over-charged dues/slush-funds–working capital funds/False Income Tax Reports” fiasco since it was first identified in 2007, the following links contain some details.   

http://blog.anthemvoice.org/2011/03/02/irs-report-released-boardauditor-has-no-more-excuses/

http://blog.anthemvoice.org/2011/02/19/reject-the-boards-shell-game-on-income-taxes/

http://blog.anthemvoice.org/2011/02/11/irs-audit-finds-sca-owes-1345-million-in-back-taxes-for-07/

http://blog.anthemvoice.org/2010/09/18/dues-holiday-is-bogus-tell-the-board-you-know-the-truth/

The accused person is long-time Del Webb, Pulte and RMI employee, Terri Da Silva.

The Nevada Commission for Common Interest Communities and Condominium Hotels (CICCH) will hear the formal prosecution by the Deputy Attorney General during a session scheduled at 9 AM for December  6-8, 2011. 

The PDF case report is attached at this link:   Da Silva Prosecution by Attorney General

This hearing/trial for alleged law violations in 2008 follows by only a few weeks the previously scheduled prosecution against certain 2008 SCA Directors (led by 2007 and 2008 Board Presidents Mike Dixon and Roz Berman) where the individuals were excused from trial due to a surprise technical error in the State’s paperwork. 

But, because the facts of the previous case were never heard by the Commission, AnthemVOICE hears that the State is considering resubmitting revised charges in 2012. 

That case was reported on in the previous AnthemVOICE and LV Review Journal articles at these links:

http://blog.anthemvoice.org/2011/06/18/attorney-general-office-removed-bob-frank-from-sca-board-indictment/
http://blog.anthemvoice.org/2011/09/01/did-defrocked-attorney-berman-mean-to-disclose-the-truth/

http://www.lvrj.com/business/2008-case-tossed-in-sun-city-anthem-hoa-dispute-128659613.html

Coming so soon after the IRS issued its 2011 audit findings against the 2007-2008 SCA Boards claiming SCA owed $1.3 Million in back taxes and penalties, 2012 looks like it could be a hard year for some former SCA board members, auditor, attorneys and collaborating community managers.  Link to one of the reports on IRS Audit:
http://blog.anthemvoice.org/2011/03/02/irs-report-released-boardauditor-has-no-more-excuses/
http://blog.anthemvoice.org/2011/03/12/what-are-the-odds-of-success/

Finally, since there have been dozens of extremely well-documented State Law violation complaints filed by SCA members against SCA Boards and RMI Community Managers since 2008, perhaps there could be some distant hope for homeowner justice, after all?  

At this point, we have only seen the tip of the iceberg of potential State prosecutions against the SCA Boards and contractors.  Meanwhile, the FBI criminal cases of HOA fraud, abuse and racketeering are reaching an ever-wider group of involved board members, community management company employees, and public officials.