An open letter to Board President Mike Umann, regarding the unauthorized $50K loan

Mr. Mike Umann

2019 Board President

Lake Lindero Homeowners Association

December 5, 2019

Mr. Umann,

Many homeowners are becoming increasingly concerned about this so-called “loan” for an approximate amount of $50,000 that was made to the Lake Lindero HOA from Christopher Barone.  This is raising serious questions as to the legality of the transaction and the liability it places on the Lake Lindero homeowners.

According to our CC&R’s the Board may not authorize or accept a loan of any amount over one thousand dollars without a vote of a majority of the membership.  Chris Barone stated on his latest public YouTube video that he considers the money he gave to the club a loan.  You have not explained the reason for the loan to the membership,  either publicly or in writing.  In general membership meetings this year you and Treasurer Bromley have stated that we were on solid financial footing.  I believe you have intentionally mislead the membership.  

Mr. Bromley has breached his duty as Treasurer by not properly accounting for this loan.  We also don’t know the specific use of the loan funds.  According to our Articles of Incorporation, “the Treasurer shall receive and deposit… all moneys of the Association and shall disperse or cause to be disbursed such funds as directed by the Board of Directors; … and shall keep proper books of account”.  Mr. Bromley has not been diligent in keeping records.  Therefore, I consider the entire transaction illegal and fraudulent by you and Paul Bromley.  It is also a conflict of interest since Chris Barone is your employee and the head of the Legal Committee.

So where does that put us, the membership, in terms of having to be responsible for paying back a loan that we did not authorize.  Certainly the membership cannot be responsible.  The HOA Board has a duty to protect our interests and this duty prohibits the Board from making decisions or acting on matters without the authority to do so.  You clearly have acted without authorization.  This is gross negligence and willful misconduct on your part and anyone else involved in this transaction.

I want to make it clear that as an HOA member I am against using any of our HOA finances to repay the balance of this loan.  To do so would be a continued serious breach of fiduciary duty owed to us by the Board and/or Lordon Management.  Any future payment on this loan, whether in cash or other forms, will be viewed as fraudulent and I will seek legal action personally against you or any Board member that authorizes such payment.

I trust our Board to do the right thing.

Sincerely,

A concerned LLHOA member

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If you like this post, you may like the following posts, click to view:

LLHOA Incomes vs. Expenses deficit in 6 of the first 10 months for 2019 - November deficit update

Where is the money!

The $50K question for Mr. Chris Barone: was it a Gift or a Lump-sum prepayment of membership dues?

Join us, Vote for change, Vote YES on the recall !

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