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Five Most Common Conflicts of Interest for Board Members

06/01/2022 12:01 PM | Anonymous member (Administrator)

By Steve Walz, RealManage

  1. Bringing proposals for consideration from a company either owned by a Board Member or relative/close friend.  According to the Professional Manager Code of Ethics, ‘Managers shall disclose all relationships in writing to the client regarding any actual, potential or perceived conflict of interest between the Manager and other vendors. The Manager shall take all necessary steps to avoid any perception of favoritism or impropriety during the vendor selection process and negotiation of any contracts.’
  2. Voting for a community improvement that would directly benefit them, while not benefitting others. This might include making repairs to only their deck or doing siding replacement on only their building, even if another building has more damage and should be addressed sooner. It’s the board member’s duty to do what’s best for the community as a whole. 
  3. Choosing which homeowners should be sent to attorney for collections.  Each homeowner should be treated equally as it relates to the rules and regulations.  If a board member is lenient with a homeowner (perhaps because they’re friends) they have to allow the same leniency with all homeowners. Having set policies in place and following them for every homeowner will eliminate the potential for favoritism.  
  4. Selective enforcement of who receives covenant violation notices. This is very similar to the aforementioned in #3, above.  Once again, the BIG rule of thumb to remember here, is treat everyone the same! If you’re going to violate someone for have grass over 3” in height, you better violate everyone who has grass over 3” in height.  If you don’t, it could potentially be a violation of the Federal Fair Housing Act. 
  5. Changing rules and regulations for personal reasons and not taking into account the needs and wants of the community.  Each HOA community has (or should have) set standards included in their governing documents as it relates to architectural, appearance, landscaping, maintenance, restrictions, etc. These standards set the tone for the community.  When buying a house in an HOA community, you’re also buying into HOA’s governing documents.  If the governing documents require each home to have one tree in their front yard, and someone on the Board has a dead tree in their front yard, they can’t just expunge that regulation simply because they don’t want to have to buy a new tree.  


Steve Walz, CMCA, is the Vice President of Operations – Colorado for RealManage. Steve recently joined the CAI-RMC Editorial Committee. His self-care includes hanging out with his dogs, playing piano, cooking and a glass of wine on his balcony.

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