Big fines for two in Meridian affair

Two men who handled rentals at the Meridian condominiums near the Strip were recently fined $220,000 by the Nevada Real Estate Commission for 10 cases of improper handling of clients' funds in 2009.

The commission did not give addresses for the rental properties that were mismanaged, but three of the 10 wronged clients named in the complaint reviewed by the commission match the names of Meridian owners in a database maintained by the site's homeowners association.

Michael Mackenzie, an owner of Berkshire Realty, appeared at the commission's April 14 hearing, where he was fined $40,000 for acts including commingling rent moneys collected on behalf of clients with Berkshire's nonclient funds; failing to remit rental incomes to clients on time; converting clients' money to his own use; and failing to cooperate with a state investigation into allegations made by three of the 10 clients. Mackenzie did not return a reporter's phone call requesting an interview.

Eric Lynn, the broker for Berkshire Realty, failed to show up for his hearing, but was fined $180,000 for similar improper conduct involving all 10 of the clients. Lynn and Mackenzie have 90 days to pay their fines.

Elizabeth Daniels, a spokeswoman for the state Department of Business & Industry, confirmed the outcome of the disciplinary actions taken by the commission at its April meeting against Lynn and Mackenzie.

Daniels also said in a statement that the commission did not revoke the men's licenses. Mackenzie "was a broker-salesman with a property management permit" during the time period in question, but had allowed his license to expire before the commission's meeting.

Similarly, Lynn had held a license with a permit for property management for the same time period, but allowed it to expire before the hearing, according to Daniels.

Sally FitzHenry, who sits on the Meridian's homeowner association board, said Monday that the discipline of the two men was important to the individual property owners involved but does not affect the homeowners association.

The Meridian, 250 E. Flamingo Road, was the site of an illegal hotel operation in 2008. The county shut the hotel down because the site lacks the zoning for short-term rentals, and it had failed to pay room taxes. Some condo owners contend that illegal short-term rentals, by various parties, are still going on at the Meridian.

The state Real Estate Commission's disciplinary actions are administrative only, but it shares its information with law-enforcement agencies that can pursue criminal prosecution.

Civil litigation also is pending against several businesses that converted the Meridian property from apartments into condos.

Contact Joan Whitely at jwhitely@reviewjournal.com
or (702) 383-0268.