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Homeowner Groups Can Fight Fraud

August 21, 1994

* Your article "Homeowner Groups Easy Fraud Targets" (Aug. 15) had a significant error of omission--it didn't say that this type of problem occurs rarely in our industry and that it can usually be prevented through responsible management.

While any industry that handles money can be taken advantage of by unscrupulous individuals bent on committing a crime, the possibility of this happening within a homeowner association management firm can truly be minimized if homeowners' groups ask these pertinent questions of their existing or prospective management companies:

* Are there proper risk management controls in place within the company, such as internal financial policies, insurance policies, and adequate staff to ensure a thorough checks-and-balances system is maintained?

* Does the company have the business savvy and resources to be prepared to respond to a situation such as the one reported, or is the firm operating on a shoestring because of its expense?

* Can the company make reparation--immediately and appropriately--should such an incident occur?

The real worth of a homeowner association management company is measured not only in terms of its price for services, but in its ability to keep its immediate and prospective commitments operational and legal.

Members of the California Assn. of Community Managers (CACM) are required to adhere to a code of ethics and standards of practice and we have a certification program endorsed by the Department of Real Estate. So another question homeowners' groups can ask its manager is, 'Are you a member of CACM, and are you certified?'

We hope that this information is of use to your readers.



California Assn. of Community Managers


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