Condo fraud is most likely to be suspected when there is an unexpected or unexplained depletion of funds in one or more bank accounts. Explanations that funds are being transferred from a reserve fund account to an operating fund account may be used to comingle funds and hide such frauds.
When condo fraud is suspected, condo directors can take immediate action:
- Contact the bank and have them put a hold on all withdrawals while the situation is investigated
- Obtain bank statements for at least the past year and copies of all cheques written on these accounts
- Inform legal counsel of suspicions
- Have someone, possibly an accountant, review accounts and provide an opinion regarding the missing funds
- Inform your insurance company of suspicions of fraud