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[1]”)  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

[1] Not to be confused with National Bank of Arizona