M.B. from Florida writes:
Dear Mister Condo,
Our longtime Co-op Treasurer has been elected to the board. Should a Treasurer be allowed dual roles? There is nothing in the Docs to say yes or no. Is it a good practice? Seems to me it is a conflict of interest.
Mister Condo replies:
M.B., please forgive my apparent ignorance on this topic. As I am not a resident of your state nor am I an attorney I cannot claim to be an “expert” on this subject. However, I must ask you how a non-Board member becomes an Officer of the association. My understanding is that folks are first elected to the Board and then elected to their officer positions by the Board members. At least that’s how it works here in Connecticut.
The underlying question you have is about conflict of interest and whether or not is it a good practice to have a Treasurer (the person with access to the association’s money) who is also on the Board (the governing body that decides how the association’s money will be spent). Provided there are ample checks and balances in place, I see no problem with this scenario whatsoever. I have to assume that to have been elected Treasurer this volunteer member of the community is trustworthy and capable of overseeing the funds of the association. I assume your Board meets regularly and that financial statements are reviewed as a regular part of the Board’s business. I also assume that your association requires two signatures on your association checks.
If these checks and balances are not in place then I would share your concern. Also, keep in mind that it would be a criminal activity for the Treasurer to steal money from the association. I found a great deal about Administration of Cooperatives online at the Florida Senate website at http://flsenate.gov/Laws/Statutes/2012/Chapter719/All If your by-laws don’t specifically show a problem with an individual serving as both Treasurer and Board Member you may wish to scour the laws to see if there is a law prohibiting it (I didn’t find any) or consult with an attorney in your region who specializes in community association law. There are many to choose from and you can find a directory of such firms at http://www.caionline.org/info/provider/Pages/CAINationalServiceDirectory.aspx. Simply search for an attorney in your area who can advise you. Good luck!