Ct Condo Associations That Suspect Theft By Property Manager Must Report Immediately To Insurance Carrier

Boards of directors at the dozen Connecticut condo complexes managed by Westport-based Consolidated Management Group should alert their insurance carriers if they suspect that money has disappeared from their accounts.

Scott Sandler, a Farmington attorney whose firm Perlstein, Sandler & McCracken specializes in representing condo associations, said Thursday that state laws require that both management companies and associations carry fidelity insurance to protect condo owners in case of theft by a management firm.

However, Sandler said that a condo association that suspects a theft must immediately contact their insurance carrier to notify them of a potential problem. That will hopefully result in the associations being fully protected. Timely notification is required, he said.

Sandler’s firm represents one of two associations managed by Consolidated that claim that a total of $530,000 is missing from their accounts.

His firm represents Strathmore Land Condominium Association, a 64-unit community in Westport, that reported to local police that $300,000 is missing.

“Because of the ongoing investigation, I have been advised not to comment at this time,”  Olaf Nelson, president of CMG told the Connecticut Post on Friday. Nelson was unavailable for comment today.

“Approximately $300,000 was deserted from our funds,” said Robert Meyer, treasurer of Strathmore Lane Condominium Association, told the Post.

Meyer he and other residents had been looking into suspicious financial activities for month after CMG’s controller left the company.

The Post identified the second Westport victim complex as  Whitney Glen Condominium Association, a 62-unit community for seniors and another CMG client. The newspapers said that the association filed a lawsuit against former CMG Controller David Liptak, of Milford claiming it was missing $230,000. Read more: http://www.ctpost.com/local/article/Alleged-fraud-hits-condos-530-000-missing-from-3867833.php#ixzz26m4OFPQG

 
According to the Connecticut Consumer Protection Department the following associations are also managed by Consolidated, which has an A+ rating from the Better Business Bureau:

Crowne Pond Assn. Inc, Wilton
Country Place Condo Assn., Shelton
Clarmont Condominiums, Norwalk (that is the correct spelling)
Fawn Ridge, Norwalk
Chateau Condominiums, Bridgeport
Fairfield Colonial Gardens, Fairfield
Long Hill village, Trumbull
Birchwood townhouses, Westport
Trumbull Townhomes, Trumbull
Ettl Park Condo Association, Greenwich
Pheasant run, Greenwich
Greenwich Green, Greenwich

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4 Responses to Ct Condo Associations That Suspect Theft By Property Manager Must Report Immediately To Insurance Carrier

  1. Martcor says:

    Think CMG needs to show good faith to all communties they represent and have them audited at their expense by a firm that has NO conflicting interest with CMG or CAI-CT. Why this secrecy if all other communities are on the up and up?

  2. Mary Powell says:

    WE had the same issue at Elmcroft Condominium Association in Stamford. We are trying to find out where the monies went. Investigation ongoing.

  3. Mary Jane Bolin says:

    QUESTION:
    Hi George,

    CCOC is a terrific organization and we thank you for all the great information you provide for those of us who are dealing with difficult situations. Keep up the good work!!!

    We have two questions and hope you will be able to assist:

    1) Our association also has a tax district. Until the current president took office in May 2015, the Board met to discuss business related to the association as well as the tax district. The only distinction between the two entities was found in the annual budget when some expenses were assigned to the association or the tax district or, on occasion, divided between the two. Our current president insists on having two separate Board meetings, one for association business, one for tax district business. It is a false and cumbersome distinction and an artificial division in the opinion of many of us. He says that our past method of conducting just one meeting was incorrect. What advice can you offer? Our by-laws do not address this issue.

    2) Our president likes to spend money (!) and is planning (without full Board approval) to have our by-laws rewritten or modified. (He has not clarified this job but says our attorney has estimated that it will cost $2,000.) He also bemoaned the fact that our tax district has never had its own set of by-laws and wants to have this document created also. Do we need two sets of by-laws for our association??

    Many thanks.

    P.S. the “contact” address, George@ctwatchdog.com is not working. My e-mail has been returned.

    • Hi Mary Jane
      I am not familiar with how the tax district interacts with your HOA. However as to your second question the president can’t spend HOA money without approval from the board. My guess is that $2,000 to rewrite the documents is low.

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