HOA Corruption

Article Courtesy of Channel 8, LasVegasNow
Published February 13, 2009

The sweeping FBI political corruption probe into homeowner's associations sent shockwaves throughout the Las Vegas valley last year.

Seven associations have been caught up in allegations of crooked lawyers and construction companies. State lawmakers want to bring the hammer down on more potential schemes, all while the FBI investigations are still moving along.

For years, homeowners have cried out for help saying scam artists were weaseling their way onto associations and then funneling millions of dollars in cushy construction deals to their well-connected buddies.

In late 2008, FBI Agents raided offices looking for proof of corruption and theft. The I-Team uncovered how it was possible for shady investors to buy into 1-percent of homes and then get elected to HOA boards.

It's these loopholes that State Senator Mike Schneider wants to close.

For years he has railed against monolithic HOA's and their boards. He is proposing bills to close that 1-percent loophole and make penalties about as tough as they come.

"There should be felony charges in there. There should be jail time and that's how serious this is," he said.

Schneider also wants to force HOA boards to open up their books to homeowners and be more transparent about contracts.

Part of the investigation centers on just how the tainted board members used the rules to get what they wanted.

It's unclear if all these reforms are going to come out as one bill, but Senator Schneider says he
wants to have the bills introduced in the next week or so. He says he finally thinks HOA lobbyists won't have ground to stand on, thanks to the investigations.