ARIZONA – Where’s the HOA’s money First Service?
Arizona Homeowners Forum: Where’s the HOA’s money First Service?
By John Sellers
October 23, 2016
To: Jeremy Ruskin, Chief Financial Officer, FirstService Corporation Toronto
I’m writing to you in response to the failure of FirstService in Scottsdale to provide timely evidence that the information I’m supplying them below is making its way up your compliance chain. If you have one. I believe these financial issues are way beyond their paygrade so you get to hear about it as CFO direct. A lot of bankers don’t seem to understand them either.
I’m an ex banker currently working with a group of likeminded people and Arizona State Senator Farnsworth to make legislative changes for Arizona Homeowners Associations. One of the things we’re doing is following the money. It’s extremely disturbing already but even more so as we broadly collect basic banking information as to how HOA Management Companies, including yourselves, are running the cash. Here’s the issues which concern me, and I have intimate experience of all of them.
Four aspects manifest themselves, the first historical, plus three current risks.
- The losses in Arizona in 2008 alone of almost $1 Billion by the FDIC in respect of First National Bank of Arizona (“FNBA”) and Desert Hills Bank (“DHB”). The successor to FNBA is Mutual of Omaha who you currently use for Vintage. FNBA, prior to the 2008 crisis, wholesale harvested, via Management Companies, such as yourselves, over $1bn in deposits over an extremely short period, of which only $75 million went back into HOA’s. This wholesale harvesting continues as evidenced by the broad documentation we’ve collected. Read more:
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