By: Libi Uremovic | Original Article at patch.com
4 Bonds Issued, but the Money Can’t be Found
Beaumont City Council has Approved four (4) Mello Roos type bonds for fiscal year 2015:
Series A Area 7A1 $11,100,000 Issued March 31, 2015
Series B Area 19A $20,095,000 Issued April 23, 2015
Series C Area 18 $5,335,000 Issued June 3, 2015
Series D Area 16 $7,820,000 Issued June 18, 2015
The importance of the bond fund accounts is to track the bond money. FOR EXAMPLE:
2004 Series D was the original bond for the 2015 Series B bond. 2004 Series D’s Reserve Account #6711742205 had a Balance of $1,647,429.88, but the money is no longer in the Account. The memo states that it was moved to another Account – presumably the 2015 Series B Bond Fund Accounts – but the City states that they did not receive any Series 2015 Bond Fund Accounts from Union Bank.
The April General Ledger shows the City received $75,000 from Union Bank for the Bonds’ Administration Fees.
The City of Beaumont has their April and May Bond Fund Accounts posted online: http://publicdocs.beaumontcares.com/weblink8/browse.aspx?dbid=0
The City states that what is posted on the city’s website is all of the bond fund accounts received from Union Bank for the months of March and April.
2015 Series A, Series B, Series C, and Series D Bond Fund Accounts are missing.
As Bond Trustee; Union Bank disperses the money for the bond. It is Union Bank that pays Rodd Gunn, O’Connor Securities, etc. Union Bank should have documentation showing how the bond funds have been dispersed and to whom.
Documentation from Union Bank showing all money disbursements from Series A, Series B, Series C, and Series D Bond Fund Accounts has also been requested. The City claims they have no such documentation.
Since the issuance of the Bonds both Alan Kapanicas and Rodd Gunn have retired themselves from the City of Beaumont. The last two bonds list the Finance Director as ‘Vacant’.
Until recently, Beaumont’s Bond Fund Accounts listed Union Bank Vice President Stephen Boughton as Account Administrator, Now Nabeel Badawi is listed as Account Administrator.
As Bond Trustee; Union Bank is obligated to disclose monthly reports showing the allocation of the funds in their possession. The Corporate Office is responsible for their satellite offices.
Beaumont’s State and Federal investigations are centered around the illegality of the bonds of which Union Bank is Trustee.
The City of Beaumont has acquired four Mello Roos Bonds, but there is no trace of the money. I am now requesting from the Corporate Office that they produce the Series 2015 Bond Fund Accounts and also a list of the Amount of money distributed from each of the four Bonds.
The City of Beaumont/Union Bank has until July 6th to release the Bond Funds Accounts.
Please let me know if you have any questions.