Saturday, October 29, 2016

The Arizona Corporations Commission and HOA's - non-profit corporations

From: John Sellers []
Sent: Saturday, October 29, 2016 5:24 PM
To: ' ' < >
Cc:;;;;; 'Betty Camargo' <>;; Louis Dettorre - Arizona Dept of Real Estate <>; Fareed Bailey <>; David Farnsworth <>
Subject: Arizona Homeowners Associations and the Arizona Corporations Commission

Dear Andy
In 2008 you and Senator Tom O’Halloran helped us out in a potential legal quagmire at our HOA in Prescott. We were one of the first three winning cases at the OAH to be challenged on purely constitutional grounds by the HOA Attorneys. Facing hundreds of thousands of legal expenses.
At the time, I think you told my wife…we don’t usually get constitutionality wrong, but as you know for a while it was. We got lucky and the HOA chickened. Others were not so lucky
Well, things move on but the onion peeling continues. I’m engaged in a struggle with my HOA in Prescott, we don’t live there anymore, which just announced the resignation of every one of its Directors, Management Company and Attorneys. It’s a black hole heading for bankruptcy.
Separately I’m part of a sizeable growing group working with Senator Farnsworth on new legislation to clean out this mess, the corruption and what I’ve testified to, think you were there, as “legal terrorism”. My own personal view as a banker is that we are close to uncovering the money angle which will expose HOA corruption affecting the 40% of Arizonans and 62 million US homeowners who have no idea where their many billions of their money is. And nobody has ever answered the question why the FDIC bailed out two HOA banks, First National Bank of Arizona and Desert Hills bank to the tune of $1BILLION collectively in 2008. Including bailing out the UNINSURED DEPOSITORS. I have a theory, but that’s for later. THESE ARE REAL COSTS TO THE TAXPAYER BECAUSE OF ZERO REGULATION
I happen to believe that this little tsunami could be a ticking time bomb for municipalities, anti-Money Laundering efforts, certain banks, taxpayers and homeowners. And ACH the money transfer system in a worse case.
As I like to say – it’s not the landscaping – IT’S THE MONEY STUPID - where totally unlicensed Management Companies, in concert with certain banks, ARE ACTING LIKE BANKS/FIDUCIARIES with $billions under management
Why am I approaching you?
One of the unsung roles of the ACC used to be to receive annual reports from HOA non-profits to show a summary balance sheet. In 2008, by clicking, I was quickly able to easily access a list of their HOA’s and add up the deposits they were collectively showing in your records. Another click to the County Recorder’s Office and what do you know – a Deed of Trust in their name from the same bank. See attached HOAMCO was roundtripping HOA moneys.
I have a blog at  which addresses this. You can get to the HOAMCO chapter including the attachments and much more by clicking HERE
I’ve tried to find out from the ACC why this simple reporting requirement was discontinued. See emails below. No response. So, my questions to you are:
Why did ACC delete this incredibly simple transparency check?
The Corporations Commission acts as a Utility Commission but, as its name indicates, it also monitors non-profit corporations like HOAs
What role could/should the ACC play in avoiding what could be, in my opinion, the next banking drama?
Look forwards to your response. This will be posted shortly on our blog so you can also respond there if you wish.
Copy: ACC Election Candidates
Tom Chabin (D), William Mundell (D) via their blog
Boyd Dunn (R) email

Louis Dettorre, Assistant Commissioner AZDRE
Dan Gardner/Fareed Bailey, Senator Farnsworth’s Office

John Sellers
Cave Creek
From: John Sellers []
Sent: Friday, October 21, 2016 2:46 PM
To: 'Betty S. Camargo' <>
Cc: Louis Dettorre - Arizona Dept of Real Estate <>
Subject: Legislative Changes
I understand all that. We’re working with Louis Dettore who’s Assistant Commissioner there.
My question was why/how did HOA’s stop reporting balance sheets to you. I presume some rule was changed
John Sellers
Cave Creek
Arizona 85331
From: Betty S. Camargo []
Sent: Friday, October 21, 2016 2:38 PM
Subject: FW: Reporting by HOAs
Dear Mr. Sellars,
I am a paralegal in the Legal Division of the Arizona Corporation Commission (“ACC”).  Your e-mail was forwarded to me for a response.
The ACC is a state agency that incorporates businesses and regulates the sale of securities.  It also governs railroad and pipeline safety and public service corporations (non-municipal utility companies).  The Commission does not regulate the day-to-day operations of corporations.  The ACC Legal Division provides legal advice and representation to our five elected Commissioners and the Commission staff.  We do not provide legal services to the public.
From your e-mail it appears that you have concerns regarding Homeowner Association (“HOA”) reports.  In 2016, the Arizona Legislature passed legislation moving the Homeowners Association (HOA) Dispute Process to the Arizona Department of Real Estate (ADRE).  I am enclosing the contact information for the ADRE that may be able to assist you with this matter.
The statutes that govern Homeowner Associations can be found in Arizona Revised Statutes, Title 33 “Property”, Chapters 18 “HOA’s Dwelling Actions”.
I hope this information is helpful.
Best regards,
Betty S. Camargo, Paralegal
Arizona Corporation Commission
From: []
Sent: Thursday, October 20, 2016 9:45 AM
To: Legal Div - Mailbox <>
Subject: Reporting by HOAs
I'm part of a group working with Senator Farnsworth to clean up transparency and other issues in HOA's.
Until 2008, I was able to detect gathering of funds by a certain Management Company in one bank which then lent the money back.
That's because they were required to report a summary balance sheet to you.
Why was that requirement deleted.

John Sellers
928 310 8220