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I was wondering if you would agree to publish my comments in response to David Berman’s comments that he made in volume 3 of his Fetherolf Chronofiles.
Thanks, Ron
In his efforts to malign the efforts of Forrest Fetherolf, blogger David Berman was wrong in his The Fetherolf Chronicles article regarding the portrayal of his wife’s innocence in signing what he claimed was a “routine” document.
Mr. Berman’s comments are highlighted below in Yellow.
When my wife Rosalyn was SCA Board president and Roger Cooper was Board secretary, they signed routine documents as required after a 6-1 Board vote on the allocation of surplus Association funds.
Actually, that document was a legally required declaration by the Board of Directors in the form of a resolution asserting the Association’s compliance with IRS Revenue Ruling 70-604. That resolution said that such surplus funds shall be returned to the homeowners when it stated that such excess membership income “shall be applied against the subsequent tax year member assessments.”
That promised return of such funds, made on 28 August 2008, never happened.
Since the Association’s IRS tax resolution falsely made a material claim of the return of surplus funds that did not take place, the Board and, or those executing the document, committed a crime. Legally, that crime was a forgery, that is, falsely producing a legal instrument with the intent to deceive—not merely the homeowners but also the IRS.
The late Bob Frank and Tim Stebbins, two residents supported all along by Mr. Fetherolf (who claimed he had an affidavit) and several others, alleged in a report to Henderson Police that this constituted a criminal act and should be prosecuted.
After a lengthy investigation, the police exonerated Berman and Cooper and then arrested Frank and Stebbins for filing a false police report.
Actually, after Sergeant Jeffrey Farley started his investigation, those investigative efforts were abruptly stopped. Sgt. Farley’s role abruptly changed from investigative to efforts that were solely designed to find evidence, real or imagined, of probable cause that he believed might be sufficient to justify the arrests of Frank and Stebbins. He would do so, presumably at the City’s request, based on what he learned at a secret meeting of himself, his supervisor and four members of the Board that took place on 26 January 2010.
The circumstances surrounding that meeting and the abrupt change in the City’s decision to arrest and prosecute Frank & Stebbins are discussed in some detail in my report, The Untold Story, which is available to read on my website.
The case was moved out of Henderson to avoid possible conflict of interest and was assigned to a North Las Vegas assistant district attorney. After a long period of delays and postponements requested by Frank and Stebbins’ attorneys, the matter was dropped because it was only a misdemeanor case and the prosecutors could not justify the cost of pursuing it. Frank and Stebbins, supported by Fetherolf, then turned around and filed a federal lawsuit alleging false arrest and denial of their civil rights. After they lost at the U.S. District Court level, Frank appealed to the appellate court, which quickly denied Frank’s appeal. In the course of the Frank and Stebbins lawsuit, the North Las Vegas prosecutor submitted an affidavit stating that she believed she had enough evidence to convict the two men, but had to drop the case purely for economic reasons.
Notwithstanding the travesty of the legal proceedings against Frank and Stebbins, did Forrest Fetherolf and friends get it right, as Frank and Stebbins had alleged, namely, that the Association had failed to either return excess surplus to members or apply it to next year’s membership dues? Yes, they got it right and were proven so as a result of an onsite IRS audit of 2007 taxes by Kathy Thomas in 2010. The auditor found the Association “did not refund or credit the homeowners the surplus funds for tax years 2001-2007,” and she concluded that “the taxpayer used an inappropriate accounting method.” As a result, her audit reported a Deficiency and Penalties totaling $1,344,821.
By Ron Johnson
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