Icon South Beach Residents Angry After Condo President Admits to Cashing $113,550 In Checks
|Marc Averette via Creative Commons|
|The Icon South Beach, a luxury condo building now in turmoil|
So it's not surprising that residents of the Icon at South Beach -- a luxurious glass tower located at 450 Alton Rd. -- freaked out after discovering earlier this month that condo board president John Stimmel had cashed more than $113,000 in checks from Icon's accounts.
Stimmel insists the cash went towards employee bonuses.
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The condo board called an emergency meeting for February 4, during which residents angrily demanded answers.
In emails prior to and on tapes recorded during the meeting, Stimmel -- who didn't return multiple calls from Riptide -- admitted to receiving and cashing 15 condo association checks worth $113,550 from 2005 to 2008. But he swore the money was promptly handed out in sealed envelopes to Icon employees as Christmas tips.
"The reason for the cash as opposed to a check was we were trying to avoid paying burdens," he said on the tape at the open meeting, which was recorded by residents and given to Riptide. "According to Continental [Group, the management company hired to run Icon], we would have had to pay 35 percent more for the tips" if given as checks, he explained.
"It seemed at the time that it was doable," he said of the practice.
When residents pointed out that the whole things sounded like tax fraud, Stimmel only dug his hole deeper. He admitted to depositing multiple, smaller checks rather than a single check for the $28,000 in yearly tips.
"Then I would have had to fill out a form which would have alerted the bank," he said. (The Bank Secrecy Act of 1970 requires banks to report cash transactions of more than $10,000.)
In a statement, Continental confirms the condo association's accountant signed off on Stimmel using the checks. "There is nothing illegal about issuing cash bonuses."
The condo stopped that practice in 2009, the statement continues, and the board has hired another accountant to review the cash payouts.
Meanwhile, the February 4 meeting has left the condo in turmoil. A group called Icon Residents for Change is pushing for Stimmel's resignation.
"This building has a $5 million budget," says one resident who wished to remain anonymous, "and they are paying out tips in cash to avoid taxes? Give me a fucking break."
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