Weather Alerts 1 View »

Cactus Springs board members claim HOA president misused funds

Cactus Springs board members claim HOA president misused funds

By Darcy Spears. CREATED Feb 18, 2013

Las Vegas, NV (KTNV) -- Fraudulent, dishonest and criminal. Those are the words used to describe an HOA president and his cohorts. They're accused in a lawsuit of stealing hundreds of thousands of dollars from the homeowners they were elected to represent. Chief Investigator Darcy Spears reports on what could be the most shameful HOA Hall of Shame yet.

Angels are watching you announces a wall plaque on the front of a house but the people inside are anything but angels according to a lawsuit.

A house in the Cactus Springs HOA near Rancho and Washington is home to Board President Thomas Hays, his domestic partner and former board member Michael Stevens and community manager DeAna Belcastro. We can't show you their faces, because they hid from our camera and our questions.

"Where did the homeowners' money go," asked Chief Investigator Darcy Spears.

"It looks like fraud," explained Cactus Springs board member Rain Liu. Rain and another board member, Linda Laine, filed a lawsuit in January because of what they call a massive fraud perpetrated against the HOA. The lawsuit calls Hays the mastermind of ring of thieves who are accused of using up more than $300,000 of homeowners money in just seven months.

"Without valid reasons. No emergencies. Where did the money go," asked Rain. 

Until recently, Rain and Linda say they were not asked to approve expenditures or given access to financial records. Since hiring a lawyer and making demands, they're now seeing records that show most of the homeowner's money has been spent on security for the gated community.

The lawsuit says Hays and Stevens set up an internal security company that they alone controlled and managed. The highest paid employee of that company was Stevens himself.

"Basically, he was getting paid $1200-$1400 per week," said Rain.

"Per week," asked Chief Investigator Darcy Spears.

"And not only that, Michael Stevens also works for our current management company," said Rain.

With security expenses of more than $306,000 in just seven months, homeowners were paying more than $10,000 a week to manage one guard shack that wasn't even staffed with real, licensed guards. In a December board meeting that was recorded, Michael Stevens gets into an argument with an attorney Rain and Linda brought in to inform homeowners about what's been going on.

"And I would suggest that you can decide who knows what they're talking about and who has something to hide," said the attorney.

"Sir, you don't represent our community and don't insinuate things," said Michael.

"I would keep your mouth shut young man," said the attorney.

"Don't make accusatory statements toward me when you don't know me at all," said Michael.

When Contact 13 went to Masters Association Management to find Stevens and his employer an employee gave us a piece of paper saying they'd been advised by their attorney not to talk because of the lawsuit. The lawsuit says Masters helped to cover up a lot of the malfeasance by board President Hays.

"We see reimbursement of petty cash for Thomas Hays, nearly $1,000-$2,000 per month," said Rain.

Reimbursements for things described vaguely in the ledger as supplies.

"Yeah, what supplies? We don't know. He never shows us any receipts," said Rain.

They claim the Masters Association Management has refused to turn over receipts. But they do know one thing, Thomas Hays likes fried chicken. They've seen one receipt showing he used homeowners money to pay for it. According to the lawsuit, homeowners also paid for Hays' and Stevens' personal cellphones. Hays even sold his car to the HOA for $5,000.

"Why would the association need to own a car," asked Chief Investigator Darcy Spears.

"He claimed that the guard needed a car for patrol, but we do already have golf carts for patrol," said Rain.

Despite a legal demand letter to pay the $5,000 back, Hays hasn't done it yet. Rain and Linda also question his explanation for janitorial expenses, which totaled more than $25,000 last year. Cactus Springs has no common building, no clubhouse, no swimming pool and no meeting rooms. Here's the humdinger: the checks were written out to the board president's mother.  

The checks to Stella Hays for the supposed janitorial services were being mailed to her son's house, but there's a big problem with that. According to the lawsuit, Stella Hays lives in Kentucky. Unfortunately, this is going to hit the homeowner's wallet.

This statement was released by the attorney for Masters Association Management Company:


“The Masters Association Mgt Co. is promptly procuring and providing all necessary documents and information to properly respond to the allegations contained in the Lawsuit.  Considering the matter is presently in litigation, it would be inappropriate to comment at this time.  The Masters is aggressively insuring that the association is properly managed and the homeowner interests are being protected.”


- Edward Boyack


Darcy Spears

Darcy Spears

Email Twitter
Darcy Spears is currently the Chief Investigative Reporter for Action News.