HOA Treasurer Indicted for over $1 Million in Fraud – Please Get More Than One Person Doing Books

Here’s another example of an HOA possibly being defrauded by the treasurer. Aaron Yashouafar of the Paradise Spa Home Owners Association in Las Vegas just got indicted for looting more than $1 million from an HOA. Over a year it is charged that he wired himself $250,000 for personal projects, and then deposited two insurance cheques for over $830,000 into an out of state account.

To me it doesn’t matter if your HOA or condominium account has millions of dollars or tens of dollars – any money misappropriated is a hardship on the owners.  There are some very simple steps to help prevent fraud:

1. Self-managed boards should always have co-signatures required on cheques, and standing polices that limit the amounts of electronic transfers.
2. Books and statements should always be presented by the treasurer to the board at each meeting.
3. If possible, use a management company to do the bookkeeping. While it’s not unheard of for a management company to “go bad” – it’s a lot, lot (lot) less unlikely because your accounts are run through a third-party, who has to make all your account statements available to your board and treasurer.
4. Move the role of Treasurer around – do not let the treasure remain the same person for more than two year. The bookkeeping isn’t too hard, and even for self-managed, outsourcing the bookkeeping is hugely inexpensive – just search the internet for services.