Courtesy of The Editorial Board of The Miami Herald
Published March 9, 2023
The allegations of gangster-style wrongdoing at one of
Florida’s largest homeowners’ associations, the Hammocks Community
Association in Miami’s West Kendall suburbs, already were the stuff of
Last year, HOA board
members faced charges of racketeering, money laundering,
fabricating evidence and using shell companies. Monthly
maintenance fees had been jacked up 400% without any real
explanation. Money seemed to be disappearing, but expenses
weren’t documented. The board hadn’t met in public in more
than four years, meeting in secret instead. Yet homeowners
couldn’t get rid of the board: One attempt was thwarted by a
fake bomb threat, and a recall effort got nowhere when the
board, in an outrageous move, threw out two-thirds of the
It took the arrests of the former president, her husband and
three others for participation in what prosecutors called a
sophisticated “criminal enterprise” to bring into the open
the insanity that Hammocks homeowners had been living with
Miami-Dade Circuit Judge Beatrice Butchko, as reported by
The Real Deal, called it “a terror situation.”
And now, in the latest
court hearing on Tuesday, it seems the fraud was even worse
than originally thought, somewhere in the range of $3.4
million, up from a previous $2 million estimate. That’s a
whole lot of homeowners’ fees stolen or misappropriated. And
it’s even more reason for a state or local crackdown on
Hammocks residents at a Justice for the Hammocks
meeting, signing petitions to recall the HOA board of directors.
The scheme in the Hammocks, as the Miami Herald has reported, apparently
revolved around payments to vendors for work that wasn’t done, with the
money pocketed by board members or family members. The investigation had
been going on for years, with the board refusing to cooperate. When
investigators from the Miami-Dade State Attorney’s Office were finally able
to gain access to the association’s clubhouse office last November — the
association at one point refused to comply with a court order because “the
board doesn’t trust the state” — they found a ton a documents, including one
stash under the floor of the office, according to the Herald.
The president, Marglli Gallego, seems to be at the heart of this. She was
first charged in 2021 on allegations she took nearly $60,000 from the
association, spending some of it on a private investigator to spy on her
neighborhood enemies. Members of the community have said that, for years,
they felt as though they were fighting the “Gallego Mafia.”
But $60,000 looks like weak tea compared with the most recent allegations of
a multimillion-dollar conspiracy.
The revelations haven’t ended, either. On Tuesday, court-appointed receiver
David Gersten said board members had used 55 bank accounts and credit cards,
something he called “exceedingly abnormal.” Prosecutors might call it
something else: evidence of a crime.
The Hammocks HOA is supposed to help govern a vast community with 6,500
housing units and a population of about 18,000. But any size HOA can abuse
its members. How many smaller HOAs are spending money in questionable or
even criminal ways that we don’t know about?
Homeowners’ associations can be boons to their community, keeping the
quality of life — and property values — high. That’s no small thing when,
for most people, their homes are their biggest investment.
But the Hammocks is proof that, without oversight, HOAs can run wild. Board
members can exploit their neighbors or even become criminal organizations.
More oversight is clearly needed. Miami-Dade State Attorney Katherine
Fernandez Rundle said in December that she is working on a plan to hold HOA
leaders more accountable. She was scheduled to hold a news conference Friday
to discuss a ”major effort” to change laws to provide new protections for
HOA residents and condo owners. That will be welcome progress.
Whether it’s a state or local effort, it’s time to learn the hard lesson of
the Hammocks HOA. And love thy neighbor, it ain’t.