At CAI-RMC, we believe homeowners deserve a voice in their communities and confidence that their association’s money is managed responsibly. HOA boards earn that confidence by taking their fiduciary responsibilities seriously and giving homeowners clear information about how community funds are used.
A former HOA president in Severance, Colo. is accused of stealing nearly $150,000 in association funds, and it raises a big question for homeowners across Colorado: How can we protect our community's money from bad actors?
HOA dues pay for shared maintenance and services. Reserve funds help cover major repairs. Losing that money can leave neighbors facing difficult decisions and additional costs. Homeowners deserve to understand how their association handles those funds and what they can do when questions go unanswered.
Recognize warning signs that deserve answers
First, missing financial reports, unexplained expenses or repeated refusals to provide records deserve attention. These are warning signs.
Also, recognize when an association has stopped holding meetings or following election procedures. These concerns warrant specific questions and documentation. Of course, seek the facts before drawing conclusions about wrongdoing, but it’s your right to dig for more information.
You can also ask who reviews the association's bank statements, how expenses are approved and when the next owner meeting and board election are scheduled. Keep copies of your requests and any responses.
Request the records in writing
Colorado homeowners generally have a right toinspect association records, including financial information and meeting minutes, subject to legal exceptions. Some private or legally protected information must be withheld or redacted.
Send a written request to the board and management company, if there is one, following the association's records inspection policy. Identify the records and dates you need. For example, request recent financial statements and records supporting an expense you do not understand. Follow applicable notice requirements and ask about any copying charges.
Copies of association records may involve a fee. Colorado law allows reasonable charges for labor and materials, capped at the estimated cost of producing and reproducing the records. Ask for an estimate and check whether the documents are already available through your community’s owner portal. A reasonable copying fee can be a worthwhile investment in understanding your association’s finances, especially given the potential costs of legal disputes or missing funds. Boards and management companies can also use recurring requests to improve access to routine documents through the portal. When evaluating management services, consider how easily homeowners can access financial information. Required annual disclosures, including the insurance summary, must remain available to homeowners at no cost.
If your request is denied, ask for the specific legal basis in writing. A documented request gives you a clearer starting point if you need further help.
Use meeting and election procedures
The Colorado Common Interest Ownership Act (CCIOA) generally requires an owner meeting at least once a year. It also allows owners holding at least 20 percent of the association's votes, or a lower percentage specified in the bylaws, to call a special owner meeting.
Review your bylaws to understand when board terms expire and how elections must be held. Talk with neighbors and follow the requirements for requesting a meeting, including notice and agenda rules. Specific requirements depend on applicable law and your governing documents. If a proper request is ignored, an attorney experienced in Colorado HOA law can explain your enforcement options.
Put checks around community money
Ask your board what financial controls it uses. Community accounts should be held in the association's name, and control over reserve funds should be shared by at least two people. Someone who cannot authorize withdrawals should receive statements directly from the bank and review them regularly. Compare payments with invoices and receipts.
Ask the bank which safeguards it can enforce for checks and electronic transfers. A requirement for two signatures on a paper check does little to protect an online transfer unless appropriate controls also apply there.
A qualified community manager or accountant can support financial reporting and independent review. The board should remain involved in reviewing the association's finances. A finance committee can also help distribute that work and bring more owners into the process.
Check protection against theft
Fidelity or crime insurance can cover financial losses caused by theft, fraud or embezzlement, depending on the policy. Ask the association's insurance professional whether coverage includes volunteer board members and anyone else who handles funds, including the management company where applicable.
Review coverage limits against the money the association holds, including reserves. Ask about exclusions anddeadlines for reporting suspected losses. Insurance can help an association recover from a covered loss. Financial controls help reduce the chance of a loss occurring or continuing undetected.
Get help when concerns continue
If requests for information or meetings continue to go unanswered, seek legal advice about your rights and the remedies available. If you have evidence suggesting theft or fraud, report it promptly to local law enforcement. Preserve the relevant documents and correspondence. The association should also seek prompt guidance on notifying its insurer.
Colorado's HOA Information and Resource Center provides information and collects complaints, but it has no investigative or enforcement authority to resolve HOA complaints. Filing there documents a concern. Legal enforcement and reports of suspected crimes require separate steps.
Homeowners can ask questions and use their rights before a financial problem becomes a crisis. CAI-RMC offers education and resources for homeowners and volunteer board members. Visit cai-rmc.org/Homeowners to learn more about understanding your association and getting involved.
