State fails to protect condo owners from board fraud, grand jury finds
By Brenda Medina
06 February 2017
Carlos Caiñas, left, confronts Guillermo Merique, right, treasurer of
the condo board at The Beach Club. Caiñas and 70 other condo owners at
Fountainebleau Park, demands Merique’s resignation on Wednesday March
23, 2016. Photo C.M. Guerrero
The Florida state agency that regulates condominium associations does
not work to protect the tens of thousands who live in condos, resulting
in extensive fraud, mismanagement and conflicts of interest among the
boards and management companies that govern them, according to a
Miami-Dade grand jury report issued Monday.
“Unfortunately, the [Department of Business and Professional
Regulation, or DBPR] seems ill-suited to resolve, correct or prevent
many of the recurring problems that have been brought to their
attention,” the grand jury report said.
The report came nearly a year after El Nuevo Herald and Univision 23
launched an investigation that revealed many cases of electoral fraud
and forgery, conflicts of interest, mismanagement, and rigged bidding
systems among many condo associations in South Florida.
The grand jury report makes it clear the Florida Department of Business
and Professional Regulation “is not effective and doesn’t protect
condominium owners from fraud and mismanagement,” Miami-Dade State
Attorney Katherine Fernandez Rundle said Monday.
“This makes condo owners even more vulnerable to manipulations and in some cases leads to the loss of their homes.”
The report echoed the complaints of dozens of condo owners, from
working-class families in Little Havana to affluent families in Key
Biscayne, documented by the reporting of El Nuevo Herald and Univision
The report noted a special committee of the Florida House of
Representatives published similar findings in 2008. “Sadly, nine years
later, this jury has listened to testimony from condominium owners
similar to the complaints” gathered by the lawmakers back then.
“Unfortunately and almost irrationally, some of the problems seem to have gotten worse,” the report said.
The findings come amid a condo building boom across the state. There
are an estimated 1.6 million condos in Florida today — nearly 300,000
more than in 2007 — and 38 percent of them are in Miami-Dade and
Despite this building boom, the state government did not assign
additional investigators to look into the thousands of complaints
received each year by the DBPR, according to the grand jury. The agency
has only 33 investigators statewide for condo issues, and only 12 work
Florida has more than 20,000 licensed condo association managers and
more than 2,000 management companies. By contrast, the Division of
Regulation within the state agency has only 53 investigators, who
regulate all licensed professionals statewide, including thousands not
related to condos.
Stephen Lawson, a spokesperson with the agency, said they are reviewing the grand jury report.
“The department takes very seriously its statutory obligations
regarding the enforcement of condominiums,” Lawson wrote in an email
Monday to the Nuevo Herald.
The report notes the grand jury heard from DBPR employees, but added
their testimony was “guarded and strained” and the witnesses appeared
with lawyers assigned by the state. In fact, the agency’s general
counsel “actually challenged our jurisdiction and authority to conduct
this investigation,’’ the report said.
had to subpoena BPR investigators
“Unlike other public officers and officials who appeared voluntarily,
to obtain the appearance of two DBPR investigators we were required to
issue subpoenas,” the report noted.
The grand jury also reported that the DBPR’s “failure to demand that
its investigators utilize, or comprehend basic investigative techniques
is breathtaking.” One of the investigators who testified repeatedly
said he did not know basic information and needed to consult with his
Grand jury members said they were shocked to learn that condominium
laws and regulations do not include clear definitions of ethical
principles as basic as conflict of interests.
The grand jury issued a series of recommendations for changes in state
laws to correct some of the principal issues: open access to condo
association records; conflicts of interests among members of
association boards; fraud in board elections; the powers of election
monitors; and the responsibilities of the DBPR.
recommended criminal punishments for condo board members
Also recommended were criminal punishments for condo board members and
licensed administrators who act “in bad faith” for their personal
profit or are involved in fraudulent activities. And the report noted
that the results of condo elections of board members should be
nullified if there’s clear evidence of electoral fraud.
State lawmakers from Miami-Dade who are drafting a law to updating
current condo statutes said they are reviewing the grand jury report.
“This report is very revealing and is going to be extremely helpful to
the Legislature as we figure out how to fix this very important
issue,’’ said State Rep. J José Félix Díaz, a Republican who represents
a district that goes from Doral to Kendall and includes Fontainebleau,
a neighborhood with many condos.
Armando Perez Roura Jr · EN CUBA
This Grand Jury report is a farce, I can assure you the problem is not
DBPR only, the problem also is the Miami Dade County State Attorney
office with don't do anything, you go there and they tell you call the
Police Department, you call or go to the police department and no one
knows what is going on. They tell you is a civil case ( is a unit at
Miami Dade County Metro Police with have 3 or 4 detectives, with they
do more that what they can do because don't have any help.)
Think of this,
In the whole Miami Dade 4 detect, and remember most of this cases you
need to do a lot of accounting, and the major problems is the Civil
Judge , you file a cases and they play the game come back in a month,
and next months and the cases last 3 and 4 years, and in the mean time
we need to keep paying attorneys fee.
The Miami Herald and the Nuevo
Herald knows of cases like that, and I have to recognize the Herald have
done a great job in this reports.
And let's not talk about this
politicians, they are ALL TALK NO ACTION, they call a press conference
tell us "we are going to do this" and what they want is free
advertising for their next election.