And You Thought the Only Thing to Worry About was the Building Falling

Calling the record keeping  “horrific”, citing difficulty in getting documentation and financial balances not carried over from one account to another, as well as “lots of open items,”  Auditor Marie D. Mirra nonetheless presented audit figures, displaying numerous sheets of numbers and accounts, and told  homeowners  it’s all because they have come through “numerous changes in both management and accountants” over two years including two different management companies and three different accountants..

In spite of that introduction the  Board of Governors of the Eastpointe Homeowners Association then unanimously approved and accepted the audit for the year ending June 30, 2021, with the phrase “to the best of our knowledge” there was no fraud, standard wording in an audit approval, the auditor said.

But condominium owners in the 14 story complex made it clear they are not happy with either the audit, or reasons given why it was accepted unanimously by the Board.  Nor were residents happy with the response to a number of questions concerning their finances in the HOA account and if they have been accurately registered.

Several residents of the complex have also made it clear in recent weeks the accounting for funds is not the only problem they see happening in the luxury units located one on of the highest points along the East Coast. There are problems, residents said, with lack of maintenance, work being done by contractors without going out for bid, the dog walk not properly cared for, reported misappropriation over several years  of collected “Dog Walk fees”  not itemized in a specific account and unacounted for, the swimming pool closed during the record high temperatures this summer and a host of other financial, economic, social and maintenance issues.

At the regular meeting of the Board of Governs held by Zoom with an estimated close to 100 people in attendance, Auditor Mira  blamed  “three different accounts and two different management, 1^st Service Residential and  PREC of Long Branch, a firm which lists Thomas Arnone as vice president, Property Management.between 2020 and 2022.

HOA President Joan Bruno praised the work of   Mirra citing her committed to excellence nd her outstanding efforts in completing the audit, she said MARIE cold only stay a limited amount of time at the meeting and questions would be limited

During the nearly 90 minutes the auditor was presenting facts and figures she gave her own credentials with 34 years in working with community associations, and noting that the previous auditing firm,  did not understand bookkeeping of a condominium HOA which led to the difficulty in locating all the monetary matters. “Whenever I think I’ve seen it all….there’s still more,” the auditor said in criticizing so much of the documentation she both had to review as well as was not available.

She cited the number of red flags she found, but discovered that rather than fraud, deception or theft, it was more because  balances were not carried over and deposits were not transferee in accounts as they should be.  She cited a “significant amount of documentation” that was inaccurate and bookkeeping balances that were not carried over.

She assured property owners, in spite of their questions that the red flags led to inefficiency errors and documentation not being tallied rather than missing funds,  and admitted the matter of bookkeeping led “lots of room for error.”

In response to one woman who owns two different units at Eastpointe and spends considerable time away from her Highlands residence  Mirra  said the onus is on the property owner, not the HOA to produce all the receipts and documents to prove she has paid all her bills over the past two years.. She told another resident his suggestions for a forensic audit could only be requested by the Board of Governors, and not individual members of the association, something the resident challenged but never received proof that It was true.  Other questions from HOA members were met with “these are issues we can resolve tonight”  or complaints they never get responses to their many questions.

Questions on work that was scheduled to be completed but was never even started, including  new asphalt  meant those funds should still be  in the reserve account, residents said,  Nor was it answered how the state of the finances and the audit and statements it was “horrendous” would impact persons purchasing a unit and applying for mortgages, other than the auditor saying banks all handle that background information differently.

Another resident, who indicated he has asked at seven different meetings for specific information about transfer of funds from 2018 – 2019 said he has never received responses to his queries, with board members urging “it’s time to move on” in spite of his still not getting a response.

Speaking after the meeting residents specified a number of areas where they are dissatisfied with managerial processes and operations. One resident filed an OPRA request for information concerning the Front Entrance Way Project when he was unable to secure the information from the board on how the more than $10,000 project was awarded to a relative of a board member without a vote from the HOA as required within their contract. The resident said “we were never shown bids on the project and are certain there were no permits or borough inspections and approvals of the work. He said when two drainage systems were filled in, it caused damage in the parking area below which has resulted in yet another cost of  $300,000 homeowners are now expected to pay.

“No bids, no permits, no response to the HOA members. This is a financial disaster being pushed on the Eastpointe owners. Someone should be in trouble, and someone should pay, but it should not be the Eastpointe owners,” the resident said.

Residents have also expressed anger and frustration their requests to see  records for “legal fees” have been denied to this time.