The Arizona HOA Honey Moneypot
The "Arizona HOA Honey Moneypot“ – why all these problems in Arizona HOA’s?
· Honey attracts bees. Money attracts the worst of behavior
· It’s the cash stupid!
· We estimate that $3bn of CASH is sloshing around in HOA bank accounts owned by YOU
· Worst example which went unnoticed in the excesses 2008 financial crisis
o Community Association Banc (CAB), a division of First National Bank of Arizona (“FNBA”) attracted over $1bn of deposits in the months prior to 2008
o Only $75mm was funneled back to communities
o Only the FDIC knows where the rest went
o They used wholesale deposit harvesting via HOA Management Companies
o Few Boards even knew or know where their cash is
o The only credentials of the President of CAB, a $1.5 billion plus bank, were membership of CAI, HOA management, and ownership of Las Vegas nightclub
o I’m not making this up – See this - click HERE
o When FNBA went under in the shadow of IndyMac, the Federal Government injected $862mm of FDIC taxpayers money
o In a highly unusual step, they also bailed out UNINSURED DEPOSITORS
o Many Arizona HOA’s had millions in excess of the FDIC insurance limit
o We believe the decision was political
· What this got to do with you?
o Be aware there are powerful dark forces at work in the HOA industry
o Few Management Companies, and none of the so called specialized HOA Law firms, have incentives to promote transparency
o The Edge at Grayhawk lost $2.4mm in fraud because nobody was keeping an eye on the Management Company
o CAI , a national organization, has huge lobbying power because of their access to money