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Paradise Spa HOA enters the Hall of Shame

Paradise Spa HOA enters the Hall of Shame

CREATED Jul 1, 2011

Contact 13 continues its HOA Hall of Shame with a place where the name is a lot prettier than what's going on behind the scenes.

It's called Paradise Spa, but as Chief Investigator Darcy Spears found, this "paradise" is plagued with problems including some condemned buildings and allegations of embezzlement.

Homeowners say the HOA board is to blame.

In it's heyday in the 1960's, Paradise Spa was a gem in Las Vegas.

A hang-out for the likes of Frank Sinatra and the Rat Pack.

Today, it's less than a shadow of it's former self.

And it's the subject of multiple lawsuits, as well as complaints on file with the Nevada Real Estate Division.

"I don't know what to think about it except that there are a bunch of crooks in here," says homeowner Iris Hokanson.

"When I went to the last homeowner's association meeting there were several elderly people--and I'm talking 20 or 30 elderly people that still live here--and they were looking at me saying, what can you do?" says former Nevada State Senator William O'Donnell.

O'Donnell is a Paradise Spa homeowner and an advocate for the elderly residents who still live here.

85-year-old Iris Hokanson is one of them.

She lived in a 3-bedroom double unit, until the building caught fire.... last January.

It's since been condemned by the County.

She continues to pay mortgage on the units every month even though she hasn't been able to live in them for almost a year.

"All the money that I've already paid and I still owe money, and I have nothing. And no place to move back in. And I don't know what I'm going to do," Iris says, fighting back tears.

The lawsuits and the State complaint say she hasn't been able to move back to her home because of Aaron Yashouafar--a Beverly Hills millionaire who's also the HOA board treasurer and whose companies own most of the Paradise Spa units.

Contact 13 discovered the HOA cashed in on almost a million dollars in insurance money that was supposed to be used to fix Iris' building and another that was involved in a second fire.

We sat down with Paradise Spa HOA president Jim Pazargad.

Darcy: "The balance sheet right here shows that $842,871.84 was given out and that $836,100 was spent. On what?"

Jim: "That... that..."

Darcy: "You don't know."

Jim: "I don't know that."

Darcy: "Where did that money go?"

Jim: "Let me tell you something about that money. I never seen that check. I'm saying right to you on the camera. I never have seen the check. Check was delivered to Los Angeles to Aaron's office--handed to him."

Where the money went from there is what she and others have asked the Real Estate Division to investigate.

If the State finds criminal activity at Paradise Spa, the case will go to the Attorney General.

Jim: "There is no criminal activity here. I promise you there is not."

Darcy: "It doesn't look good."

Jim: "Well, I know it doesn't look good."

It looks bad enough for O'Donnell and other homeowners to personally file a lawsuit.

"When we found out that most of the money is either gone or absconded with, I said this is unconscionable. This is the worst case of elder abuse I've ever seen," says former Nevada State Senator William O'Donnell.

He says it doesn't get much worse than this: Contact 13 learned on top of Iris's mortgage for the burned units she can't live in, she's also paying $600 a month rent to a real estate company run by the very same man who collected insurance money on her building and never fixed it.

Contact 13 tried multiple times to reach Yashouafar, leaving messages at his Beverly Hills home and with Jim Pazargad, who acknowledged that Yashouafar knew we were trying to reach him.

"You know the fact that he's not responding to me makes everybody think he's got something to hide," Spears told Pazargad.

"No, I'm gonna send him an email and make sure he calls you," he promised.

Yashouafar never called. 

So we had to ask Jim about another financial failing detailed in the lawsuits and the homeowners' complaints to NRED.

"They have not paid their association dues to the tune of about $700,000," Bill O'Donnell told us.

Yashouafar's companies own 288 units in Paradise Spa.

Pazargad says his fellow board member is constantly sending money to pay other association bills.

"So if he can send you money at the drop of a hat and he's got this big, fancy house in Beverly Hills, why can't he pay his association dues?" Spears asked.

"Wow," Pazargad responded, astonished.  "You really investigated this guy, huh?"

That's my job, Jim.

That, and getting answers for Iris and others who've been left in the lurch.

"We shouldn't charge these people when their units are just sitting there, I would agree with you 100% on that," Pazargad said.  "If they were paying rent up to now, they have to be reimbursed."

Iris has not been reimbursed, but after Contact 13 got involved, Pazargad promised she'd no longer have to pay rent.

He also promised Yashouafar would fix the fire damage so she can have her home back.

Jim: "He's gonna fix it. He's gonna fix it."

Darcy: "Alright, let's shake on it. He's gonna fix it."

Jim: "I'll shake hands with you that he told me he's gonna fix it."

Iris has a hard time believing any of it.

"Now that they've said the building is condemned, I'm not too hopeful on that."

Aaron Yashouafar's track record may be an omen for what's to become of Paradise Spa.

We found some of his properties in Los Angeles, Oklahoma and New York facing bankruptcy and foreclosure.

His management of the New York properties led to the Village Voice listing him as one of the city's 10 worst slumlords.

And, he's under separate investigation by the State of Nevada for his Sky Las Vegas high rise over allegations of fraud and over-billing residents for power usage.

Paradise Spa has gone into receivership while all this is being sorted out.

That case and the lawsuit filed by homeowners about the HOA board are both scheduled to appear in court this week.

Contact 13 will be following them every step of the way.

And we want you to continue sending us your nominations for the HOA Hall of Shame. If you have any story ideas, please email them to 13Investigates@KTNV.com or call 702-257-8440.