Florida Representative Julio Robaina, a Republican from the 117th district, wants to be the lawmaker who tamed condo fraud. The Miami Republican authored House Bill 1397, which would create a new police force, so-called “condo detectives,” overseen by the Department of Business and Professional Regulations. The police force would respond to allegations of fraud and other illegal practices in condominiums. It’s now under consideration in the legislature.
Condominium fraud remains a problem spiraling across Florida, and Robaina told The Real Deal why the bill matters and why he believes it is long overdue.
Why are you proposing the addition of a new police force?
It’s because condo fraud is at an all time high. There are an even higher number of complaints we’re getting from unit owners about things like condo association financial mismanagement, kickbacks, and special arrangements with contractors.
We’ve been doing a pilot program in Miami-Dade and Broward, where we have been screening complaints. When people claim fraud, they’re asked to submit whatever proof they have. If there is probable cause by the Office of the Condominium Ombudsman, which I established years ago, we take the information and forward it to the local police departments. Typically, the police that deal with them are economic crimes units that handle white-collar crime. But the cases have gotten to be so many that they’re piling up in small police departments, and they’re not getting priority.
What is wrong with the current system in place?
Every person pays a $4 tax that goes into a trust fund set up to help out people that live in condos. For years we’ve been screaming about fraud, but we’ve done nothing except raid that trust fund to the tune of over $26 million in the past three years, and they are not getting anything in return.
What I’m trying to do is take less than $400,000 a year out of there and establish [a condominium] police department. These are local police officers that will only do fraud investigations for condominiums. There is enough work for them to get around and do these investigations. They will act like any law enforcement officer that is doing any type of white-collar crime, and become specialized in looking for fraud. And if they find it after investigation, the case is simply given to the state attorney’s office for prosecution.
Who are the typical perpetrators of these crimes?
The biggest culprits are normally board members. We’ve had so many arrests in Dade and Broward, and all over the state. We need a group of people in law enforcement who will make it their priority and their only responsibility to investigate fraud.
Is the problem with condo associations?
The super-majority of condos work well and have great people, ethical people, but you do get those bad apples. The proof is in all the arrests. You have property management people that inflate the prices. You have them working in cahoots with the board. At times you have self-managed condominiums — those really scare me — the condos that do not want to hire a licensed professional manager so they let the president or one of the board members be the manager at the same time, so they do everything — they manage money, they pay the bills. We even saw a case like that where people had been paying their credit cards from the maintenance fees. In another case, someone had stolen 750,000 dollars and was headed out of the country.
Who would oversee this police force?
They’ll be overseen through the Department of Business and Professional Regulations. This is an idea that has been long in the coming and long overdue. I guarantee that these guys will have dozens of arrests before the year’s out. These would be certified law enforcement officers, just like every other officer. And no, they’re not going to go around pulling people over, or give tickets. They need to be viewed more as not condo cops, but condo detectives.
How would investigations be initiated? Would the police force itself initiate them?
Once the complaints are filed, they are screened. A lot of them are nothing more than someone who is just upset, but every so often there is enough evidence, where it looks like somebody is putting money in his or her pocket. And if it is, the condo detectives would get the case after it’s been screened by the Ombudsman’s office, meaning it’s now passed the first stage of probable cause. They would then be able to go on site, solicit records, look at documents, and do an onsite investigation. The same way they investigate when there’s a potential for Medicare fraud. If they find there’s fraud, they turn it over to the state attorney’s office. They won’t initiate their own investigations, there has to be a complaint generated. They’re not just going to fly around the state to find someone to investigate.
Does the economic situation increase the risk of these kinds of incidents?
Absolutely. [People are saying], “I was in hardship, I couldn’t pay for my insurance, I couldn’t pay my credit card bills.” I think the hard economy is driving people that normally would have never done this type of white collar crime to consider it.