South Boston condo property manager accused of taking $200K in missing funds
CBS Boston
By Ryan Kath
11 October 2017
BOSTON (CBS) – The trustees of a South Boston condo association are
scrambling to pay the bills after they say a former property manager
disappeared with an estimated $200,000 of funds.
The Channel View Condominium Trust has now filed a lawsuit in an effort
to recoup the missing money and Boston police tell the WBZ I-Team they
are also investigating.
As high-rise residential construction sprouts up around the Boston
area, real estate legal experts say details of the financial dilemma
can serve as a lesson for other condo associations.
Along West Third Street, there is plenty of evidence of neglected
maintenance at the 18-unit Channel View building: rotted wood, peeling
trim and missing exterior lights.
The Channel View Building (WBZ-TV)
“This is all stuff that should’ve been done and stuff that we had set aside money to do,” trustee Andrey Lyalko told the I-Team.
For the previous ten years, Jean Kong and her business XLT Property
Management had overseen the finances for the condo association.
However, when basic maintenance started falling through the cracks,
trustees decided it was time for a new management company to take
charge.
“There were a lot of red flags,” Lyalko said.
Those red flags soon turned to panic. The new management company was
hired to begin in April, but trustees say Kong had control of the
association’s bank accounts and kept stalling about transferring the
money.
Trustee Andrey Lyalko shows problems with the Channel View Building (WBZ-TV)
Prior to the management change, the Channel View Trust had sold two
underground parking spots for about $135,000. According to court
documents, those funds should have been deposited into a reserve
account, bringing the balance to an estimated $200,000.
Emails provided to the I-Team show some of the delays trustees
experienced. In one exchange, Kong said she could not get a ride to the
bank in Connecticut. In another, she told trustees that she had a bad
reaction to a new medication.
“It was just weeks and weeks turning into months of excuses, injuries
and illnesses,” trustee and condo unit owner Nicole Corcoran explained.
“We couldn’t get any straight answers from her, so then we got really
concerned.”
Ryan Kath talking with trustees Andrey Lyalko and Nicole Corcoran (WBZ-TV)
According to the lawsuit, Kong’s last communication was in late May
when she wrote, “I hope to have all the remaining files and funds
turned over with the next 2-3 days and resolve the outstanding issues
as soon as possible.”
When Kong stopped communicating, the trustees decided to sue her in Suffolk Superior Court.
The huge hole in the budget has trustees feeling the heat from condo owners who paid their dues.
“People had been paying more than their fair share to cover expenses,”
Lyalko explained. “To tell them it was all for nothing and the extra
fees they paid actually contributed to us losing the money…that’s a
tough thing to have a conversation about.”
Speaking generally, real estate attorney Jordana Roubicek Greenman said
cases of mishandled condo association funds can easily happen if
trustees and residents are not vigilant.
“If you’re a bad actor, it might be easy to get away with something
like this if people are not asking questions and checking to see where
the money is going,” the attorney said.
Real estate attorney Jordana Roubicek Greenman (WBZ-TV)
The I-Team found several recent examples around the Boston area:
A property manager who stole $95,000 from a complex in Lowell
A Waltham woman who admitted to embezzling $350,000
A mother and son, facing allegations of ripping off a Leominster condo association of $175,000
Greenman said there are a number of safeguards condo associations can
implement, including: always having access to financial records;
requiring more than one signature to approve purchases; and making sure
the insurance policy covers losses due to embezzlement.
“If the correct protections are in place, and if you ask enough questions, this should not happen,” Greenman said.
Kong did not respond to phone calls or email inquiries from the I-Team.
When approached outside her Newton home in September, the former
property manager got in her car and drove away without answering any
questions.
Jean Kong getting into her car (WBZ-TV)
Following that exchange, Kong sent an email that indicated WBZ would
receive a statement from her attorney. To date, that still has not
occurred.
Court records also show that she has not filed any response to the
lawsuit. Trustees are currently trying to win a judgement so they can
access the bank accounts and recoup any funds that are still available.
But as more time passes, they are not feeling much optimism.
“We put our trust in her as our management company and she just blindsided us with this,” Corcoran expressed.
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