In a first, state boots North Las Vegas HOA board

State officials, in an "unprecedented action" announced on Tuesday, removed the entire three-member board of the Autumn Chase Homeowners Association in North Las Vegas.

"This is the first time the state has taken the extraordinary step of removing an HOA's board for violating the law," said Terry Johnson, director of the Nevada Department of Business & Industry, which runs the Real Estate Division. "It is critically important that homeowners associations operate with transparency and accountability in carrying out their duties."

The board members - Joseph Bitsky, his wife, Barbara Bitsky, and Hellen Murphy - were ordered to surrender the association's credit card and give all association records to the state until a new board can be elected, officials said.

The action resulted from a complaint filed by the Nevada Real Estate Division against the three board members accusing them of a series of state violations, including failing to prepare financial statements or to conduct board elections.

All three board members also were charged with retaliating against the homeowners who filed the complaint with the Real Estate Division and of improperly charging more than $10,000 on the association's credit card for their personal use.

The state action comes amid a long-running, unrelated federal investigation into a massive scheme to take over 11 homeowners association boards and steer lucrative legal, construction and community management contracts to the conspirators.

So far, 27 people have pleaded guilty in the high-profile investigation, and federal prosecutors expect to charge another dozen or so suspects by the end of the year.

Prosecutors have alleged that more than $8 million was funneled through secret bank accounts to fund a scheme to take control of 11 homeowners associations between 2003 and 2009.

The wrongdoing alleged at the Autumn Chase Homeowners Association, which has been mired in public infighting for the past several years, pales in comparison. The association has 46 homeowners and operates on a $9,000 annual budget.

But its former president, Joseph Bitsky, attracted plenty of publicity. Last year, he pleaded no contest in North Las Vegas Municipal Court to coercion. The plea stemmed from a contentious meeting at his house in which he blocked the front door to keep homeowners from leaving. He was upset over a recording of the meeting.

Gail Anderson, the Real Estate Division's administrator, said Monday's disciplinary action against the three Autumn Chase board members was necessary to "protect the interests of all homeowners in this association."

After a series of hearings, the Nevada Commission for Common-Interest Communities and Condominium Hotels, which is part of the Real Estate Division, concluded Monday that Joseph and Barbara Bitsky committed 248 and 261 violations of state law, respectively, officials said.

They were ordered to pay $82,600 in fines, $10,312 in restitution to the homeowners association and $22,884 to the state for the cost of the investigation.

The Bitskys also were barred indefinitely from serving on a homeowners association board in Nevada.

The commission did not fine Murphy, saying she might have been a victim of the Bitskys. But the panel precluded her from serving on a board in the future, officials said.

Joe Salvatore, an Autumn Chase homeowner who had fought to expose the Bitskys, said he is pleased with the commission's action.

"I'm pretty relieved for the most part because now we don't have to worry about them controlling the board ever again," he said. "It's a validation of all of the hard work we've done the last four years."

Paul Terry, president of the Nevada chapter of the Community Associations Institute, which serves as a voice for homeowners associations, also praised the removal of the board members.

"We think it's an appropriate and very positive development," Terry said. "It's pretty clear that the Bitskys were acting inappropriately and using the association's funds for their own purposes, and now they're paying a high price for it."

Joseph Bitsky declined to comment, stating only that, "We are luckiest people in the world."

Contact Jeff German at jgerman@reviewjournal.com or 702-380-8135.