Category Archives: Condo Management

From the chairman of the committee in charge of his Pattaya Condominium building the author of “Welcome to the Fun House” comes the kind of advice condo owners need.

What a $400 oil change tells you about Pattaya condo repair ripoffs

Pattaya condo repair ripoffs are harder to detect than embezzlement but very noticeable if you someone’s asking you  for a $400 oil change.  But before I explain exactly how our condo employees tried to pull this one on me, remember just one thing.  It’s in their DNA.

Also–I am the chairman running my condo community so I should know a few things the rest of you don’t

Now let me give you a little background.  We had an office girl, bookkeeper, who our past chairman and committee trusted too much.  The chairman was a good man.  And he was a very smart man.  But he never tried to understand the Quickbooks accounting system I introduced years ago.  The bookkeeper did.  I trained her.  The problem tried to keep track of what she was doing.

The embezzler would receive maintenance fees and utility bill payments from our residents in cash.  Then she gave those residents Excel spreadsheets showing that they had paid all their bills.  She then pocketed their money.  And the Quickbooks accounting system displayed large sums of money as “undeposited funds”.

When I took over as chairman I got a fellow American to be on the new committee as my right hand.  Ralph was even better on Quickbooks than I was.  So the secretary bookkeeper suddenly disappeared when Ralph started asking her why she failed to deposit the undeposited funds.

We had the thieving bookkeeper by the gonads and she knew it

Then we reported the missing bookkeeper to a Thai lawyer.  This lawyer has a lot of power and all kinds of connections.  The lawyer located the missing bookkeeper and called her to account.

We then had a meeting in the lawyer’s office about how we should handle the embezzler.  $20000 had gone missing.  Our past chairman, two other committee members and I met with the lawyer. One of the men asked the lawyer:  “What percent of the condos in Pattaya are ripped off by their employees who are managers or bookkeepers?

The lawyer replied–99 % of all Pattaya condos are being ripped off by such employees

While the thieving bookkeeper was embezzling our money, we had a completely inept manager who was either conniving with the bookkeeper or looking the other way.  So when the shit hit the fan in our condo office, she suddenly quit and disappeared.

We got a new manager.  An honest young woman.  Then we started requiring all condo residents to pay our condo bank account directly.  We made it very clear that our new committee would cut the hands off of any condo resident who tried to pay cash to our office girls.  We also hired a new bookkeeper.  Who was just as scrupulously honest as our new manager.

And to make a long story short, we have stopped the accounting embezzlement in its tracks.  While we are forcing the embezzler to make monthly payments to pay back what she has stolen.

It’s now time to move onto Pattaya condo repair ripoffs

Embezzlement is to be expected more than it is to be unexpected. But I’ve already dealt with that in — How most Pattaya condominiums cheat their owners.

Unfortunately Pattaya condo repair ripoffs are even harder to detect than embezzlement.   But they are very noticeable if you being asked for a $400 oil change.  Here’s a tall tale  that’s based on a true story that I’ve changed to protect the guilty.   Unfortunately for all of you Pattaya condo owners out there this tale is all too true.  Welcome to Pattaya condo repair ripoffs.   Just keep in mind as you read it—–ripping people off is in their DNA.

 It all started when our condo engineer technician warned us:  “Big problem with water pump and fire control system.”

The entire sorry episode started when a condo committee member warned other committee members our insurance wouldn’t cover us for fire damages.  He warned:  “If our insurance finds our fire control system is deficient I am afraid it won’t cover us”.

The committee member  assumed that a fire control sensor and alarm would go into action as soon as it detected a fire.  He also assumed that an apparatus in our pump room would then automatically start a Cummins diesel engine.   And that this Cummoms diesel engine would start a water pump that would pressurize the fire hoses in throughout our building.

Our manager decided it was time to call in the experts when we couldn’t figure how the fire control system worked.  She found a company that specialized in such cases.  And two technicians visited our condo from Bangkok.

Then the company the technicians worked for presented a 174,000 ($5500) baht bid to our manager.  When I looked at that bid, I smelled a rat.  The entire 174000 baht bid included 1 item for a 13000 baht oil change.  Which is $400 in American money.

The problem was the technicians underestimated their opposition

Me

I lived and worked on a farm for 23 years.  I owned 3 tractors.  This was my largest tractor.

This tractor uncovered Pattaya condo repair ripoffs
It took 22 quarts of oil to change the oil of my John Deere tractor. It had 180 horsepower so it’s engine was a lot bigger than the Cummins diesel engine running our condo water pump

I cannot count how many times I had to change the oil for those three tractors.  And their engines were very similar to the Cummins engine at our condo.  Except they were much larger.  So the procedure for changing the oil was the same.  For the 3 tractors or the Cummins diesel running the condo water pump.

But the 174000 baht bid was for a complete overhaul of the entire system, which included replacing several water valves, a pressure gauge, several ball bearings and their seals.

Hey—I had done a lot of that before.  On my farm equipment.

But now our condo engineer enters the picture.  He thinks our entire water control system should run on automatic.  Trouble with that is, if we keep running the pump to pressurize all the fire hoses, if there’s a leak in one of the hoses, we are going to have really big problems.  So getting all this fire control equipment to run full automatic makes no sense whatsoever.

I decide that this entire 174000 baht bid is just one more example from an endless list of Pattaya condo repair ripoffs

Meanwhile one of the two Bangkok technicians contacts our condo manager.  He tells her:

Don’t tell anyone.  But I can do this whole job for only 100,000 baht.  Just don’t tell my company.

But the Bangkok tech’s made a big mistake.

Our new manager is honest.  She tells me everything.

Then our technician contacts me.  He diagrams the repair job for me.  And then he tells me:

“I can get this entire repair job done for 100,000 baht.  Will you accept my bid?

“Bingo.  I’ve got those Bangkok techs by the scrotum and I’ve also got our engineer technician by his balls.”

“Yeah.  100,000 baht if the conniving Bangkok tech does the job.  But it costs the same 100,000 baht if our technician gets the same work done.  I know what time it is.”

And so does our manager.

So here’s how we handled that 174000 baht repair

We never did a damn thing.  We were paying our own tech 25000 baht to take care of our interests.  He wasn’t.  So a few months later we fired his sorry ass.

We ran fire drills.

  •  We implemented a procedure of checking all the fire hoses on our condo’s 7 floors.
  • And while we did that we checked to make sure that all the valves on each level, etc were working correctly.
  • We started training our security guards and other key employees how to start up the Cummins diesel engine.
  • And how to turn on the fire hoses properly until they were gushing out enough water to do their job correctly.
  • We replaced the two batteries for the Cummins diesel engine
  • And now each month we run the diesel engine for an hour or two to keep the batteries charged.
  • And to make sure the Cummins diesel engine is working correctly.
  • We make  our own employees responsible for changing the Cummin’s diesel engine’s oil.
  • While we use normal inexpensive oil that is commonly used for diesel powered trucks, etc (instead of that very specialized oil the Bangkok company wanted to get us at very inflated prices)

The lesson all Pattaya condo  committee members need to learn about Pattaya condo repair ripoffs are

Ripping off condo owners for both unnecessary and excessively high repair costs is a way of life here in Pattaya.

As Doctor Phillaneous Beckstein once put it: “Getting hired on as a Thai manager or other key employee  for just 20,000 baht a month is a big deal.  That’s  because that 20,000 represents only part of what a manager or other employees make given all the opportunities there are for ripping off the owners.  All condo owners in Pattaya should know that they are more likely to be ripped off than not of victimized by Pattaya condo repair ripoffs.  And act accordingly. Committee members need to be very vigilant.  They need to take action on repair issues.  Lastly the rest of the condo owners need to fully support  their elected committee members. Nothing less will  save them from Pattaya condo repair ripoffs

How most Pattaya condominiums cheat their owners Part 1

I have heard from those in the know that up to 99 percent of Pattaya condominiums cheat their owners. Personally I don’t think the figure is quite that high, but I do know many condominiums in my area have successfully ripped off their owners by embezzlement, by charging outrageous amounts of repairs or both. I need to oversee the interests of our condominium owners. This is my job. Therefore it is my business to know how condo owners get ripped off and to do my utmost to see that this does not happen here. This is part 1–embezzlement.

How to Avoid Embezzlement

Lesson 1: Let me start off by asking all of you a single question? In your home country, whether it’s in the United States, Germany, the United Kingdom, Australia or wherever, would you leave $50,000 lying around in your home in full view of a new girlfriend you had just picked up in a bar, at Walmart or whiile shopping for groceries at the supermarket? If you are a rational adult you certainly wouldn’t for several reasons. First, you haven’t known the woman for a long enough period to be able to make an informed opinion as to her character. Second–fifty thousand dollars is a large enough sum to tempt a large amount of people you would meet in such casual circumstances to cross the line. Third, even if your new live in girlfriend was fundamentally honest with small amounts of money, fifty-thousand dollars is a large enough sum to make her reconsider the right price at which she will sell her integrity. The bottom line is you simply wouldn’t leave $50,000 lying around your place for the easy taking. So if this is true back in your home countries, then why would you ever allow your condo office employees such easy opportunity in Pattaya, especially when Pattaya has the seedy reputation it so richly deserves? With the huge discrepancies between what your typical office employee makes in a country such as the United States and Thailand allowing the condo manager or secretary to collect  even 300,000 baht amounts to the same thing as leaving $50,000 lying around your home in the West.

The solution is to completely remove the temptation by making it impossible for your office personnel to collect large sums of money  from your condo owners. You simply require all condo owners to pay their maintenance fees and utility bills through direct payment to your condominium bank account. As the old saying goes, there’s nothing like putting and keeping the money in the bank. The condo owners can then be required to pay direct deposit to the  condo bank account either in person , through internet banking or by ATM. Paying by ATM Is easy because all your owners have to do is to key in the condo bank account and the amount of the invoice one is paying. A confirmation then appears on the ATM screen that indicates that it is the condo bank account after all. Once the transaction is completed, the ATM produces a receipt which can then be handed over to the condo office girl as proof of payment.

Not only does this stop embezzlement at the source, it also can make a vast improvement in your condo’s cash flow.   We did it here at my condo under my direction and it worked like gang busters.  Try it, and if someone doesn’t like it tell him to stick it where the sun doesn’t shine.

Lesson 2. Do not trust a Thai “professional auditor” or CPA to uncover the embezzlement in your condo. . Thai law requires that certain procedures are carried out in such an audit. From my understanding of Thai law such audits are geared around profit and loss. From what I’ve seen the condo’s own balance sheet is of no consequence so long as all the bank deposits have been accurately recorded and the invoices have been accounted for. My own condo uses the accrual accounting system which means that if a condo owner is invoiced a 20,000 baht maintenance fee this counts as 20,000 income even if the condo owner’s deposit at the office is never made at the bank. The balance sheet never shows the 20,000 baht deposit simply because the 20,000 baht never made it to the bank in the first place. But it most certainly does appear in the condo profit and loss statement simply because the basic assumption is that the condo owner will pay. But suppose the condo manager or office girl pockets the 20,000 baht and then records it as having been paid. She then gives the condo owner a receipt. He’s satisfied now that he’s been given a receipt for paying his bill, and as for the receipt, it might even be the same kind of receipt he was given at the grocery bill or at McDonalds.

So accounting wise what happens to this 20,000 payment? It belongs into an account that is called Undeposited funds. On the condo books it has been collected from the condo owner, and one might think that it now resides in the condo safe to be later deposited at the bank. The reality, however is that oftentimes the money is being used by the condo office girl or manager for a month, two months or even for a much longer period of time. I have personally examined the books of a nearby condominium community which showed 441,000 in undeposited funds. No one knew where the undeposited money went. But it sure didn’t land in the condo’s bank account. As for the professional audit, I doubt if the auditor even as much as looked at the condo’s own balance sheet because the audited balance sheet showed exactly 441,000 baht less what it actually was. Lesson to be learned here is Thai auditor’s ignoring of undeposited funds and the internal balance sheets produced by a condo’s accounting software is an open invitation to embezzlers.

Lesson 3. Get a good accounting software program like Quickbooks and use it. Especially Quickbooks. It might be difficult to buy a fully licensed copy of the software here in Thailand as foreign credit cards are usually not accepted by Intuit, the company that offers Quickbooks. I bought a licensed copy of Quickbooks for my own condo using my U.S. credit card and then I simply made sure that I was reimbursed by our condo office. And…Quickbooks is in English so it might be difficult for your office personnel to learn how to use it. The solution is if your office personnel cannot learn how to deal with Quickbooks in English to fire them and hire people who can successfully deal with it in English.

Lesson 4. Make sure that at least one member of your condo committee understands how to use the software and that he can teach your office personnel how to use it. Our manager and office girl have been highly successful at learning how to use the software which has paid for itself many times over.

Lesson 5. The condo owners must be supportive of the committee and the manager unless of course one or the other is not doing their job properly. Owners must realize that their condo community is not a Democracy. It is a Republic and as such the condo owners elect those owners they want to serve on the committee and then they must let their duly elected committee do its job. If it is not doing its job properly it can then elect a new committee at the next general election. My study of History tells me that true Democracy came to us from Athens in Greece over 2,000 years ago and ultimately it did not work when a couple thousand citizens all started interrupting each other and shouting and carrying on until pandemonium reigned. More recently I learned from a condo owner who lives not far from me that his condo community has just gone through five committees due to condo owners thinking they were more important than committee members. Lawsuits were threatened by selfish owners and a well qualified manager was even beaten up by the girlfriend of an arrogant owner who felt his girlfriend was the condo queen bee.

Lesson 6–Condo Committee members need to pay attention. They need to actually work at doing a good job, at checking the accounting for the condo’s finances, and getting to know their fellow condo owners. They should know who is likely to be paying his bills on time and who isn’t and if those who do have been properly credited in the condo’s accounting system and so on.

Lesson 7–Here in Pattaya it oftentimes pays to be an embezzler. When is the last time you ever heard of a Pattaya condo manager or office girl who has stolen a condo’s money actually having to do jail time for her crime? Probably never. For one thing if an embezzler runs off with the condo owners’ money she’s likely to disappear to Bangkok or to Rural Such a Toni. Her family and fellow Thais are likely to cover for her since embezzlement is not typically viewed as a serious crime here. And if anyone does not believe me consider this

A. Even if the office manager is caught stealing, is apprehended by the police, convicted of a crime and then does some serious jail time and one of the condo owners publicizes the fact that she is a thief while giving out her name she can then sue him and win for defamation due to his causing her to lose face even though she’s a criminal by Western standards.

B. The police will usually not arrest her anyway. Instead she will be offered the chance to pay back what she has stolen, she will then say that she will try and in the end the condo owners will wind up not being able to force her to pay anyway.

C. The high cost of litigation. I have recently been told by a reliable Pattaya law firm that to initiate criminal court action against an embezzler that this law firm would have to be paid 160,000 baht just to start and that it would then take at least one year just to get the case underway and that there would be little chance for success given the fact that many witnesses would have to be called into court but would not be available due to their having to be back in their home countries, etc. The same law firm told me that it would cost 120,000 baht just to start a Civil Court case against the embezzler.

In a nutshell here in Pattaya you get to steal and collect the rewards of your theft but you don’t have to suffer any of the consequences. You can even get an office job similar to the one you have just left because so many Thai companies never ask for references or enquire of a prospective employee, “What have you been doing with the last few years of your life?” You don’t even have to suffer from embarrassment or being publicly recognized as the criminal you really are. Here it’s all smoke and mirrors. It’s the land of make believe and a real Disneyland for adults. Nevertheless it is possible to get good employees but this is highly unlikely unless you pay very close attention to the fact that this isn’t the West and that Western values are for the most part not valued here.