Condo boards have broad authority to manage multi-million dollar budgets and reserve funds. These boards typically oversee the entire management process for a community. They establish policies and procedures. Major expenditures and projects are approved by them. More broadly their role is to ensure the collective and individual interests of unit owners are being addressed.
Most condo boards are conscientious and effective. Major problems are rare. The frequency of problems increases in communities where a volunteer condo board lacks directors with solid financial skills. The likelihood that funds will be mismanaged because of incompetence or fraud will increase. Condo owners have been found to elect dishonest directors who steal money, and to elect less competent boards that do a poor job of collecting and spending money. Both problems can continue for years before owners suspect problems.
No degree of legislation can protect against these problems. The only known effective solution is for condo owners to become more involved. Learn more about how your building operates. Know the limits of financial reporting provided to you. Ask probing questions. Participate in community meetings and elections.
Electing more conscientious, capable and qualified individuals as directors remains the best way to ensure your community is well run and properly managed.