Miami-Dade leaders to tackle condominium fraud in Tallahassee
Miami Herald
By Brenda Medina & Enrique Flor
15 April 2016

Miami-Dade Mayor Carlos Giménez speaks with Luz Moscoso and Ruben Gallardo, condominium owners who attended the meeting at county police headquarters.   Roberto Koltún

Miami-Dade Mayor Carlos Giménez says he will travel to Tallahassee during the legislative session to support a group of state lawmakers from South Florida who will seek to reform state legislation in order to crack down on a wave of condominium frauds.

The initiative that will be submitted in November by State Rep. José Félix Díaz, as leader of the county's delegation to the state legislation, aims to make substantial changes in the state regulations for residential complexes.

“I am going to support the proposals of Rep. Díaz when he goes to Tallahassee to fight for these changes in the laws on condominiums and home owners associations,” Giménez told el Nuevo Herald. “I will go with him to give him my full support and make sure these proposals can pass.”

Giménez' decision was applauded by a dozen residents who attended a meeting Thursday at the county police headquarters in Doral to discuss the growing allegations of condominium fraud.

A series of investigative articles by el Nuevo Herald and Univision 23 published last month has revealed a string of scams and irregularities affecting Miami-Dade condominiums.

After the stories were published, residents of several condos around the county have organized protests demanding action by local and state authorities. During the meeting Thursday, condo owners announced they would march in downtown Doral Saturday, starting at 11 a.m., to demand changes in the state laws that regulate condos.

Also attending the meeting at county police headquarters were Díaz and state prosecutor John Perikles, who heads the financial crimes unit in Miami-Dade, as well as detectives from the county police's economic crimes unit, a representative of the state department that regulates condos, known as DBPR, and residents of condos in Doral, Fontainebleau, Hialeah Gardens and North Miami-Dade, among other areas.

“When I discovered that my signature on a vote in my condo elections had been falsified, I complained to the DBPR but was told they could no longer investigate because 60 days had passed,” said Fabio Peñaloza, resident of the Las Vistas condo in Doral.

“I went to the Doral police and they told me they did not have the resources to investigate this type of crime, and that I should go to the Miami-Dade police,” Peñaloza said. “There, a detective … told me the case was complicated and the investigation could take a year or two.”

“But what we have found is not an isolated case. It is a major pattern of fraud,” he added.

Other owners at the meeting also complained that authorities do not investigate allegations of electoral fraud, irregular bid processes and financial mismanagement in the condos.

The problem is especially prevalent in Miami-Dade, which has 22 percent of all condos in Florida and is the source of the vast majority of the hundreds of complaints received by the DBPR each year.

So, who's problem is it?

“The police tell me, 'that's not our problem.' The prosecutors tell me, 'this is not our problem.' So, who's problem is it?” said Jose Rosario, a resident of the Samari Lakes condominiums in Hialeah Gardens.

Miami-Dade police Assistant Director Freddy Ramirez replied that the department recently ordered its agents to file reports on any complaints about condos received. Condo owners have complained that police departments usually handle their allegations as civil matters and refuse to document them.

County police opened an investigation last month of The Beach Club in Fontainebleau Park after el Nuevo Herald and Univision 23 published articles showing a massive falsification of signatures on votes for a board election, as well as the allegedly fraudulent award of a $5 million-dollar contract to a roofing company.

Ramirez, Gimenez and other officials at the meeting insisted that current laws limit the capacity of police and prosecutors to investigate condo cases. Residents, for their part, complained that the DBPR — Department of Business and Professional Regulation — often claims it does not have the jurisdiction to investigate some types of complaints.

Díaz noted that after meeting with condo owners and analyzing the fraudulent schemes uncovered by el Nuevo Herald and Univision 23, he decided to propose that the Miami-Dade delegation urge the state legislature to adopt condo regulation reforms as a priority. He has tried at least twice to make some changes in state laws that regulate condos without success.

“We have real and systemic problems, and they are not all the same,” said Díaz. The solution is “a combination of the DBPR, state prosecutors and police. And there must be a more profound examination of what activities must be categorized as crimes.”

Díaz said part of the reforms will include categorizing as crimes some of the activities by companies that manage condos, and strengthening the rights of owners.

The legislative proposal, he added, also will seek to clearly define conflicts of interests that wind up bleeding condo coffers for the benefit of a few people.

charging extremely high prices

“We have seen that there are companies in different Miami-Dade condominiums that do business with other companies they are linked to, but are charging extremely high prices,” said Díaz.

“It's difficult to regulate private businesses, but what we can do is to make sure that condo owners can know the true bids” for condo contracts, he said, “and not allow cases like The Beach Club, where there are allegations of a fraudulent bidding process.”

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