Article Courtesy of The Miami Herald
By Brenda Medina and Erika Carrillo
Published March 13, 2017
After decades of struggling against a condo regulatory
system that experts say perpetuates impunity and makes it easy to commit
fraud, thousands of condominium owners in Florida may finally see
substantial changes in state laws.
Earlier this month, state senators and
representatives from Miami-Dade filed a bill that includes
21 reforms to Chapter 718 of the Florida statutes. The
reforms seek to correct gaps in the laws and establish
criminal penalties for some irregularities in the
administration of condos.
The plan classifies falsification of documents, an offense
that now carries no legal consequences, as a third degree
felony and sets prison terms. It also criminalizes electoral
fraud, such as the falsification of signatures on ballots
for condo boards of directors, and refusing access to
administrative records with the intent to cover up crimes.
The proposal came one year after el Nuevo Herald and
Univision 23 published a series of investigative stories on
condo abuses in South Florida, like electoral fraud,
falsification of signatures, conflicts of interest,
embezzlement and cases of fraudulent bidding.
Hundreds of Miami-Dade County condominium owners
marched in protest in the city of Doral on April 16, 2016.
The series also exposed the lack of enforcement by
authorities, from local police departments who refused to investigate
allegations of fraud, to widespread negligence at the state agency in charge
of enforcing condo laws and regulations and investigating complaints.
“The importance of these reforms is that
all these ideas came from the people and from all the
residents that we interviewed,” said state Rep. Jose Felix
Diaz, chairman of the Miami-Dade delegation to the Florida
Legislature and prime sponsor of the proposal in the state
House. “For the first time there will be criminal
consequences for those who commit fraud.”
Diaz added that many of the ideas to criminalize abuses by
condo administrators and boards of directors came from the
county police and the state attorney’s office in Miami-Dade.
A grand jury report last month harshly criticized the state
agency that regulates condos, the Department of Business and
Professional Regulations, saying it had been negligent in
the investigations of thousands of complaints submitted to
The report made several recommendations for changes, which
were taken into consideration by the Miami-Dade lawmakers as
they drafted their proposals.
State legislator René García speaks at a press
conference on Friday, March 3, 2017, to outline proposals for new
laws that would make it a crime to rig condo board elections.
Miami-Dade State Attorney Katherine Fernandez Rundle and
state Sens. René García and José Javier Rodríguez announced they had
finished the proposals at a recent news conference.
Also at the conference were Miami
Commissioner Francis Suarez, representing the Miami-Dade
County League of Cities, County Commissioner Esteban Bovo
and a group of condo residents.
Fernandez Rundle said her office “on a
daily basis, deals with complaints from condominium owners”
who have problems “from trivial issues that make daily life
difficult to the improper use of millions of dollars.”
“That’s when the owners realize the state of Florida offers
them few legal protections and guarantees,” she added.
Police and State Attorney officials have insisted that the
lack of criminal penalties in condo laws and regulations
when it comes to investigating and punishing allegations of
condo fraud, limits their jurisdiction in these type of
The new bill includes the following provisions. It would:
Force condo associations to publish
financial reports. If financial and administrative
documents are not provided as required, those
responsible for distributing the documents could face
criminal charges that range from a misdemeanor to a
third degree felony if the documents are withheld to
cover up a crime.
Establish an eight-year term limit
for members of board of directors. “How many times have
we heard that the same people are president and vice
president, and they just exchange the positions,” García
said. But members could stay more than eight years if
they win a super-majority vote.
Establish penalties for
electoral fraud, which includes the falsification of
signatures on ballots, and punishments for those who are
not owners but vote or those who “disappear” ballots.
Miami-Dade State Attorney Katherine Fernandez Rundle
speaks at a press conference on Friday, March 3, 2017, with state
legislators from Miami-Dade to outline proposed reforms to condo
laws. She said her office ‘on a daily basis, deals with complaints
from condominium owners’ who have problems ‘from trivial issues that
make daily life difficult to the improper use of millions of
Clarify the definition of conflicts of interests to
prohibit condo directors from being hired to provide services to their
condos and from hiring relatives. Currently, board members can be hired to
provide services such as cleaning, painting and repairs as long as they
disclose the conflict to the other board members.
The el Nuevo Herald and Univision 23 series highlighted the case of the Los
Portales III condo in Hialeah, where four board members had been paid more
than $100,000 by the management company over five years. The payments were
approved by the board members themselves, without the knowledge of the rest
of the owners.
After the news media’s investigation, the Miami-Dade Police Department
assigned detectives who specialize in economic crimes to handle complaints
of condo fraud. They have made five arrests for theft and embezzlement in
the past year.
“Any change in the legislation that gives us more power to help the victims
in these cases of fraud is welcome,” said Juan Perez, director of Miami-Dade
police. “It’s important that other police departments join the county’s
Rodríguez stressed that the proposed reforms are the result of bipartisan
cooperation, and that the Miami-Dade delegation expects to receive the
support of lawmakers from central and northern Florida.