CLOSURE IN EMBEZZLEMENT CASE

An Opinion By Jan Bergemann
President, Cyber Citizens For Justice, Inc.

Published December 4, 2010

Remember the rage of the owners in the Boca Rio Townhome community when they found out that quite some of their association funds had disappeared into the coffers of the Hard Rock Cafe and other casinos?

HOMEOWNERS -- THERE GOES YOUR MONEY- AND HERE COMES A SPECIAL ASSESSMENT!

Remember the public outcry when Assistant State Attorney Preston Mighdoll said state laws that regulate homeowners associations lack criminal sanctions, making financial crimes hard to prosecute?

STATE LAWS THAT REGULATE HOMEOWNERS' ASSOCIATIONS LACK CRIMINAL SANCTIONS

In this case the homeowners in the Boca Rio community finally got some sort of Happy Ending -- quite a good chunk of the embezzled funds could be recovered, thanks to the hard work of Jean Winters, Esq. from the Boca Raton law firm of Winters & Winters, PA.

Attorney Jean Winters worked tirelessly hour after hour to go after Betty Marshall, the former president of BOCA RIO TOWNHOME ASSOCIATION, INC. in Boca Raton, Florida. Initial investigations showed that more than $400,000 of association funds were unaccounted for. But neither the local police nor the state attorney's office were of much help to investigate the theft. Requests for help from local state legislators fell on deaf ears.

The law firm of Winters & Winters, PA was retained by Boca Rio Townhome Association, Inc. to represent the association against former board president Betty Marshal, her husband Albert Marshal and former vice president Mike Addessi. Those three persons were charged with embezzling more than $400,000 of association funds. The association finally settled with Mike Addessi, when it realized his part was relatively minor in comparison to the theft by the Marshals.

The actual theft had occurred over a period of two-and-a-half years. Then board president Betty Marshal handled the day-to-day affairs of the association, and only she had access to the bank statements. After first writing herself more than $13,000 in checks, Betty Marshal took out two debit cards on the Association’s bank account.

Using these debit cards, Betty Marshal helped herself to more than $400,000 of the association’s money. Here are some of the debit card purchases that Betty Marshal charged:

v Hollywood and Coconut Creek Seminole Hard Rock Casinos

v Borgata Hotel Casino & Spa in Atlantic City

v Global Cas(ino) in Henderson, Nevada

v Online gambling purchases at offshore trading and/or gaming locations in Great Britain, Korea, the Philippines, Netherlands and Sweden

v ATMs and point-of-sale debits at various other locations, including Philadelphia and Hershey , Pennsylvania, and Florida

v Chocolates and airline tickets in Hershey, Pennsylvania

v Rental cars, cable and Internet services, and Napster file sharing service.

When association members exposed the Marshals, a new board finally called the police. The next day Betty and Albert Marshal fled from Florida to their home in Pennsylvania. Five days after their escape to PA, the Marshals conveyed title to their Pennsylvania home from both of their names to Albert Marshal’s name only – in hopes of avoiding creditors (like the Association). The Marshals had already refinanced their Boca Raton property for more than twice what it was later worth, and the bank foreclosed on that property. Only the Marshals’ PA home had substantial equity remaining.

The attorneys had as well to battle with the insurance company that claimed there was no coverage. Indeed there was coverage and the association recovered $150,000 from the insurance company. As the next step on the road to recovery of funds, Winters & Winters, PA filed a lawsuit for conversion, fraud and for fraudulent conveyance, taking steps to prevent the Marshals from draining all the equity from their Pennsylvania home. The Winters law firm litigated the case against two sets of lawyers hired by the Marshals, and finally obtained a judgment on liability against the Marshals.

Trial on the amount of damages was set for October 20, 2010, but on the day before the trial the Marshals finally caved in. The Boca Rio owners obtained a consent judgment of $250,000 and title to the Marshals’ Pennsylvania property. Upon sale of this home, Boca Rio could recover up to $100,000 in equity. Everybody dealing with these issues knows how difficult it can be to collect from embezzlers -- especially from gamblers -- if there is no criminal prosecution. Boca Rio owners were actually fortunate to get the deed to the property.

The State Attorney's office was only willing to prosecute Betty Marshal for the checks, not the credit card embezzlement. Betty Marshal’s criminal case is still pending.

On October 19, 2010, Winters & Winters, PA resolved the case against the Marshals in Boca Rio Townhome Association’s favor -- giving the owners of the Boca Rio community some sort of closure after this horrible experience with bad neighbors.

We all know that embezzlement and fraud are rampant in Florida's community associations. But not all owners from associations hit by embezzlement are lucky enough to find attorneys that are willing and determined to go after the bad guys. In this case, the association members recovered much of the missing funds through the diligence and persistence of their attorneys.

Considering the fact that there are a lot more embezzlements of association funds than there are bank robberies, our Florida legislators should finally create the necessary law to prosecute these dishonest people that rob their neighbors. Financial damages in the six-figure range are only all too common -- with the bad guys getting away without criminal prosecution.

Since our government forces developers to create community associations, our government should create the necessary laws to protect the owners against embezzlement, theft and scams, making NEIGHBORS STEALING FROM NEIGHBORS a criminal offense, strictly prosecuted by our law enforcement agencies.

The owners of the Boca Rio community were lucky enough to recover a big part of the embezzled funds -- thanks to the hard work of their attorneys, Winters & Winters.

THE BOCA RIO SAGA