|Pressure||One or more people hunger for
|Opportunity||The condo has lax controls so it
is easy to steal money, services or goods.
|Rationalization||The perpetrators rationalize why
it is acceptable to steal from the condo corporation.
|Diversion of cash transactions||Someone rents the party room and
pays cash. Someone else pays to rent a parking spot. This cash does not
go to the condo but into someone's pocket.
One manager was in charge of three condo buildings, each with over 500 units and he stole from all three of them. Cash can be paid for the use of guest suites, paying monthly fees or to pay off chargebacks.
|Defalcation of property||Items are purchased and they
disappear. No one knows where they went.
At one building refrigerators were ordered for a few units. One frig was sent from the store straight to the manager's house. The new manager never found out where the other refrigerators went but they were not delivered to the corporation.
it is not stealing but incompetence on the part of a director, employee
or a manager. There are lax controls, a failure to maintain records and
a failure to collect arrears.
the areas where the corporation may be at risk and put in processes to
eliminate these risks. There can be collusion, inadequate separation of
duties and/or inadequate segregation of control authority.
One manager was hiding the amounts that certain vendors were receiving by submitting huge numbers of invoices for small amounts. It is a good idea for the treasurer to ask for a list of cheques by vendor.
|Operation controls||Put in a set of controls that
will detect any missing funds or goods.
Allow owners to attend board meetings. (They can observe but must remain silent.) Allow the owners to examine all the corporation's records that are not restricted for legitimate reasons.
One manager was asking all the contractors submitting quotes on a job to pad the quotes by a given amount because he wanted his house painted.
If the directors are using contractors that work for the board to do work in their units, disclose this at a board meeting and have it recorded in the minutes.
The best controls is to allow owners to attend board meetings.
|Share information||Talk to the directors at nearby
compare the costs they are paying for similar contracts and hourly