By Deborah Goonan, Independent American Communities
HOA corruption and fraud takes many forms. This month’s roundup features several elaborate schemes, and plenty of dirty tricks.
Authorities: Foreclosure lawyer Mark Stopa made nearly $5 million off clients’ homes
Susan Taylor Martin, Tampa Bay Times
Published: September 28, 2018 Updated: September 29, 2018 at 10:09 PM
During the foreclosure crisis, thousands of Floridians turned to Mark Stopa for help in saving their homes.
The 41-year-old St. Petersburg lawyer became one of the state’s best-known foreclosure defense experts, quoted in national publications and portraying himself as a bulwark against heartless and conniving lenders.
But even as Stopa helped many people hold on to their homes, he acquired millions of dollars worth of property from other clients through what authorities say was a years-long pattern of fraud and deception. The alleged scheme to defraud clients and mortgage lenders has had a ripple effect throughout Florida, leaving thousands of foreclosure cases in limbo and Stopa’s former firm about to file for bankruptcy.
“It’s like the Titanic going down,” said Richard Mockler, a Tampa attorney who has tried unsuccessfully to salvage Stopa’s law practice.
On Aug. 21, agents of the Florida Department of Law Enforcement raided Stopa’s offices in downtown St. Petersburg. According to the search warrant, Stopa obtained title to distressed homes throughout Florida using shell corporations, many of them registered in New Mexico. The properties were then rented out while Stopa, under the guise of representing the original owners, continued to fight the foreclosure cases.
Agents subpoenaed Stopa’s PayPal account and discovered deposits from individuals at approximately 20 properties controlled by his companies.
Between Jan. 1, 2011 and April 1, 2018 records showed, Stopa received a total of more than $4.8 million.
See also: Attorney Mark Stopa’s foreclosure cases are halted but clients’ checks are being cashed
According to FDLE, Stopa pretended to be helping homeowners facing foreclosure by taking title to their homes. But after acquiring 90 homes through his New Mexico based shell corporation, Stopa placed tenants in the homes and began collecting rent, without making mortgage payments.
Several months ago, after Stopa’s law license was suspended, Tampa Attorney Richard Mockler took over Stopa’s law firm. He attempted to salvage the practice. But following an August raid by FDLE, the firm is now headed for bankruptcy.
Stopa’s criminal investigation is ongoing. Former clients of Stopa must seek new attorneys.
South Hampton HOA president, treasurer charged with felony theft (MD)
By Paul Lagasse firstname.lastname@example.org Oct 16, 2018
South Hampton Homeowners’ Association president Ulysee Davis, his wife Linda and HOA treasurer Benedicto Afroilan have each been charged with felony theft and conspiring to steal in excess of $100,000 for allegedly stealing money from the South Hampton Homeowners Association over the course of at least five years, according to charges filed by the Charles County Sheriff’s Office.
The charges cap a 14-month investigation by CCSO’s financial crimes division that involved tracing payments to and from multiple accounts in least three banks and the seizure of documents from the Davis and Afroilan residences.
According to the charging documents, “it is apparent that the defendant Ulysee Davis conspired with co-defendants Benedicto Afroilan, [Afroilan’s daughter] Elsa G. Afroilan, Linda Davis, and [Davis’ daughter] Uniqueka McKinney Davis set up a shell corporation called Unique Management Company in a guise to steal money from the South Hampton Homeowner’s Association.”
Ulysee Davis ran as a Democratic candidate for county commissioner for District 2 in the Primary Election. He lost to Thomasina Coates.
Note that, prior to his arrest, Ulysee Davis is a former candidate for his county commission. It’s becoming quite common for HOA board members to use their positions as stepping stones into local politics.
Apparently, homeowners were unaware of this family’s bogus management company scheme for several years. Ultimately a few HOA members became suspicious and contacted the local Sheriff.
Property manager admits to defrauding Charleston communities of $700K
By Andrew Knapp email@example.com
The Post and Courier (SC)
Oct 19, 2018
A Charleston-area property manager accused by dozens of homeowner associations of pocketing more than $700,000 of their money now faces prison time on a federal criminal charge.
Karen Colie, who owned Marshland Communities on Johns Island, was charged Wednesday with wire fraud. She promptly pleaded guilty to the felony that carries up to 20 years behind bars and a $250,000 fine. She was not immediately sentenced.
Filed in U.S. District Court in Charleston, Colie’s plea agreement called for her to pay back every “identifiable victim” that fell under her scheme.
IAC wrote about Karen Colie of Marshland Communities in 2016, when the former community manager skipped town leaving dozens of condo association high and dry. In case you missed the previous post, check it out here. Note that Colie was trained and certified by industry trade group Community Associations Institute.
Woman, 42, accused of siphoning water funds
By Jessie Stensland. Whidbey-News Times (WA)
Friday, October 19, 2018 6:00pm
The former secretary/treasurer of a North Whidbey community association is accused of stealing more than $40,000, court records state.
Johanna M. Boyle, 42, is accused of paying her husband, who was the association’s water manager, thousands of dollars for work he did not do over a seven-year period, according to the police report.
Prosecutors charged Boyle in Island County Superior Court Oct. 16 with one count of theft in the first degree, with an aggravating condition alleging she used her position of trust to commit the crime.
The missing money came to light in 2016 after a wife and husband were sworn in as the new secretary/treasurer and president.
The woman replaced Boyle, who had held the position for years.
Another husband and wife play tag-team in this alleged scheme to defraud owners of at least $43,000. The ploy went undetected for many years, because it involved the collection of relatively small fees to disconnect water supply whenever someone moved out of their unit.
The incoming new board members — also a married couple — were wise to engage the services of a professional accountant to help explain discrepancies. The accountants reports serves as evidence for local police.
Bartow business owner pleads guilty to racketeering
Posted Saturday, October 13, 2018
BY JAMES SWIFT, The Daily Tribune News (GA)
A Cartersville-based accountant pleaded guilty to violating the federal Racketeer Influenced and Corrupt Organizations (RICO) Act in Bartow Superior Court Tuesday.
Gregory James Heath, principal of H&H Tax & Accounting LLC at 17 Felton Place Suite C in Cartersville, entered a negotiated plea of guilty to 64 counts of theft by taking while serving as an accountant and money manager for the Lakes of Stonegate Homeowners’ Association in Kennesaw.
“As a fiduciary of the HOA, [the] defendant was charged with proper management of the HOA’s funds,” a bill of indictment states. “Instead, the defendant used his position and access as accountant to siphon funds from the HOA’s accounts into his own accounts and those of his business.”
Cherokee Judicial Circuit Judge David K. Smith sentenced Heath, 45, to 30 years with five years to serve in confinement and the remainder to be served on probation.
“I don’t want you being in charge of people’s money,” Smith said. “With computers these days, it’s possible to do all kinds of things, and you demonstrate that.”
Heath received a 20-year sentence, plus a $1,000 fine, for one count of violating the RICO Act. He also received a consecutive 10-year sentence for theft by taking and an additional $1,000 fine; concurrent with that sentence are 62 additional counts of theft by taking.
In total, Heath is ordered to pay $71,907.58 in restitution to the Lakes of Stonegate HOA through the Department of Community Supervision. According to a Bartow Superior Court final disposition, the fines associated with theft by taking counts will be suspended if all restitution is paid within 10 years.
This Cherokee County Judge was tough on Heath, once a well-respected tax accountant in his community. RICO charges almost always result in longer prison sentences.
Former treasurer gets jail, probation after embezzling from Costa Mesa homeowners association
By SEAN EMERY | firstname.lastname@example.org | Orange County Register (CA)
PUBLISHED: October 15, 2018 at 11:44 pm | UPDATED: October 16, 2018 at 2:24 pm
A former homeowners association treasurer who embezzled more than $100,000 was sentenced Monday to probation and jail after agreeing to pay the money back.
Bonnie Harris, 71, was sentenced to three years of felony probation and 36 days in local lockup after pleading guilty earlier this month to four felony counts of embezzlement, according to the Orange County District Attorney’s Office.
Harris, who according to court records has homes in Seal Beach and France, previously served as the treasurer for the Cedar Glen Homeowners Association in Costa Mesa.
When a new treasurer took over in January 2016, discrepancies in the bank records were noticed, prosecutors said. Costa Mesa Police Department investigators determined that she had embezzled about $115,000 from the association between December 2013 and December 2015, court records show.
At 71 years of age, Harris, the former HOA Treasurer should have known better. In this case, the HOA was fortunate that the stolen money, $115K, was returned. Quite often, the association never receives full restitution.
See no evil: How a culture of secrecy boosts South Florida’s condo market
Luxury properties in the region are ensnared in an alleged billion-dollar embezzlement and money-laundering scheme. Those who built them? Not so much.
By Keith Larsen | September 25, 2018 03:32PM
The Real Deal
A lawyer with ties to Venezuela’s oil ministry, a member of the country’s “boliburguesía” elite and a money launderer sat around a Caracas office table while armed guards and a German shepherd with a shock collar stood watch.
The boliburgués placed his handgun on the table. It was November 2015, and the three Venezuelans were pressuring an unnamed associate to persist with a scheme that U.S. authorities would later allege embezzled $1.2 billion from the Venezuelan state oil company, PDVSA. Much of that money, according to a criminal complaint, ended up in South Florida real estate.
Among those reportedly alleged to be connected to the scheme: the three stepsons of the country’s embattled president, Nicolás Maduro; a billionaire Venezuelan TV mogul; and former executives at PDVSA. Eight people have been charged in the case so far, while one defendant — a wealth manager at a Swiss bank — was arrested in August.
With a federal investigation ongoing, the U.S. attorney’s office could seize at least 16 South Florida properties tied to the defendants. But in the initial complaint filed in July 2018, only one was explicitly named: Unit 2205 at the Porsche Design Tower in Sunny Isles. Federal officials allege this condo was ultimately transferred by Carmelo Urdaneta Aqui – who until 2015 was legal counsel to the Venezuelan oil ministry – to the alleged money launderer, José Vicente Amparan Croquer, as payment for services rendered.
Luxury real estate in South Florida has long served as a magnet for wealth from South America. The continent’s tycoons, celebrities, athletes and assorted hustlers have seen it both as a playground and a bank — a good place to invest or park cash, given its proximity, culture, weather and, most of all, its discretion: The provenance of the wealth has historically mattered little to Miami-area developers and brokers. What’s mattered is that their buyers have it.
A not-so-shocking report of money laundering in South Florida’s luxury real estate market. According to the Real Deal, an ongoing federal investigation ties billions of dirty money back to the corrupt Venezuelan Oil Ministry. But real estate agents selling high-end real estate don’t seem to care where the money comes from.