Tucson woman accused of gambling away $5M in embezzled funds

[brokenwave]

Bob:

Anyone considering a real estate purchase is going to make “an off the cuff analysis” before buying. Mine is probably better than most as I’ve bought and sold more homes than most, and I seriously considered Cholla Bay, which I still fell has a unique southern Mediterranean vibe. I just read your most recent 3 or 4 HOA newsletters which are up on your website. I’ve never seen anything like this before, with personal attacks coming from the board, and implied allegations of improprieties. I’m usually not on Facebook, but there is some pretty tough stuff on your community page. It is indeed as bad as Brokenwave said above. Actually worse.

It could indeed be impossible for your community to move forward with the current association, or at least some of the present board members. But I’m going to double down on my essential analysis. A large group of invested homeowners need to raise some funds and provide essential services to ensure a functioning community and protect resale values. I’m sure most of you hoped your purchase in Cholla would be an investment, and you need to act decisively to protect that investment.

Best of luck to you. (And by the way I last skied on Friday, in Snowbowl, and I don’t get over my skis).

As I stated Cholla is a different animal from many communities. It grew from a collection of fishing shacks in the 50's into what it
is today. I built in 1988 and it was much different than today. Back then it was a fairly peaceful community, with the exception
of the anti-Brown group, who contested the fact that the Brown family owned the land here in Cholla and most of Sandy beach.

During the past 15-20 years as many Cholla originals passed away or sold out, new people came in and discovered how cheap
it was to have a place near or on the water without any real rules.
As the new people discovered Cholla there were many with $$ to splurge on a vacation or retirement homes and many built homes
much nicer than what was here already. Cholla didn't see a custom designed home until approx. the early 2000's after that many
new homes were built on the water front lots for 50-60% of what a place in Las Concha's would cost.

The difference is much closer now because people discovered Cholla is a great place to live.

The HOA and the theft has divided Cholla, where 300-350ish people are OKish with the current HOA issues and all.
Then there are approx. 130ish people who hate the HOA calling them thief's and liars and want to start all over.
From what I've have seen much is based on hearsay with lot's of mud slinging.

Cholla is made up of lot's of really nice places, $350K-$1 million+ homes and then you have hundreds of
places between $100K-$350k and many more that are abandoned or seldom used in major need or repair.
With that you have the many different attitudes that come with this various diversity and then you have the investors
with another mindset.

For me personally, I'm OK with whoever is in charge as long, as what I am paying for with my HOA dues is supplied to
the community.
When the new President takes over (the current Pres is done) and other board members come in
hopefully an audit is done and if there is any truth to the rumors, that there was any other wrong doings found,
then the previous board members responsible should be made accountable. Good luck with that!!

Since there is close to $200K in cash the HOA has in the bank (not the $100K I said before) that is a tempting
sum for people to get their fingers on, especially here in Mexico where the rules are just different vs the USA.

If Cholla were able to actually start a real HOA with some not crazy rules, that would be great to protect the homes we
have. It was tried in the past and never even came close to getting passed, so the attitude here is rules we don't like any
stinking rules. Cholla is still like the old west.

 

[Idyllwild]

Brokenwave:

Keeping the existing HOA with fresh leadership is by far the most efficient path forward. Some current Board members might consider stepping down as part of the healing and moving forward process. My community in Flagstaff recently went through the creation of a road district to pave and maintain our roads, which have actual craters on them. A vocal minority opposed the creation of anything similar to an HOA, and the imposition of any form of taxation to pay for the improvements. One even sold his house and moved to Idaho. I’ve paid a few hundred dollars for the initial legal and engineering work, and I’ll pay about $600 a year toward the improvement bond for some years. Chicken feed compared to doing semiannual alignments on the vehicles, and we’ll probably see an immediate 15% increase in resale values. Emergency vehicles will have better and faster access to our community. Insurance rates might go down. A special needs child in the community will be picked up and dropped off at his residence instead of by the highway. Some people in the neighborhood don’t like each other. So what. Everyone benefits for a modest cost.

An HOA should only have enough money on hand to meet short term expenses and fund a reserve. A large HOA in the US would calculate reserves based in the infrastructure that might need to be replaced or repaired in the next five years or so, and reserves would typically be funded at less than 100%, typically between 30 and 70%. Cholla owns almost no infrastructure, so it’s not clear why your HOA had ca. $400 K on hand. Maybe consider putting some tangible improvements in place and spending down the money on hand. A way to deal with free riders is to provide services to owners who are current on obligations. If you bring water in every served residence is going to need a water meter and an account with the HOA. If you pave streets, you might elect to pave streets or segments of streets with higher levels of participation.

Three years ago, when I was looking in Cholla, there was almost always a police presence at the entrance to the community. My realtor, the late Brian Hefferman, a Cholla resident, told me that the HOA had paid for a police car. The last half dozen times I’ve been to Xochitl‘s for breakfast there has been no sign of the police. If that has been suspended it might be a good idea to bring it back.

Lastly, the discrepancy between the sums taken, $170 K vs $360 K, appears to reflect the perpetrator’s tactic of moving money between the three entities she was stealing from in order to hide her crimes. I’m doing so, she stole each dollar on more than one occasion.

Regards