Citing illegal compensation and a breach of fiduciary duty, members of the politically active Neighborhood Market Association (NMA), including one of its founders, are suing the organization and CEO/President Mark Arabo, alleging a lack of transparency and a “failure to provide financial documents.”
The complaint seeks information regarding an alleged real estate transaction in which the NMA is said to have “realized a substantial profit.” The disenchanted members are seeking to determine how the “profit was distributed for the benefit of NMA members.” The lawsuit alleges that Arabo received approximately $210,000 as a “finder’s fee” for the deal, while noting he “was not a broker in the transaction or otherwise entitled to this compensation.”
The NMA leadership briefly rebutted the complaint, in a response to Rostra. “The suit filed is baseless and without merit,” said Executive Chairman Amad Attisha. “We stand by the NMA leadership and our practices.”
The NMA, made up of hundreds of independent and local markets, liquor stores, and convenience stores in the San Diego area and throughout California, has used its political clout for several years in local elections and advocacy, while opposing government efforts to increase fees and regulations on its member businesses. Arabo, the group’s current president and CEO, was selected as one of SD Rostra’s area “Influentials last year, in which it was noted…
Mark Arabo was included as a “Voice for Refuge” in … Voice of San Diego. He leads the Neighborhood Market Association, while last year becoming a national spokesman for persecuted Iraqi Christians, working to address their plight with Congress and the Obama Administration. Some have noted he may be looking to run for office. A local consultant said, ‘Arabo is a pro-business Democrat with a bright political future.’
The NMA members sent the following statement to Rostra…
Members of the Neighborhood Market Association (NMA) have filed a lawsuit against the NMA and its officers for failure to provide financial documents for review, as required by the NMA Bylaws. The members made numerous requests for the documents prior to taking legal action.
The NMA is a non-profit mutual benefit corporation serving a group of neighborhood markets, liquor stores, convenience stores and independently owned supermarkets in California and surrounding states. On or about September 24, 2015, a group of NMA members (NMA Plaintiffs) filed a Civil Complaint, San Diego County Superior Court Case Number 37-2015-00032389-CU-OE-CTL, against the NMA, Mark Arabo, NMA’s President and CEO, and Amir Oram, NMA’s former Secretary/Treasurer, seeking the appropriate remedies for the NMA’s failing to produce certain requested documents. The documents requested include the NMA’s membership list, financials reports, agendas and minutes of boards meetings, all which NMA members have a right to examine.
“I requested the NMA’s membership list repeatedly since 2010, however it has never been provided,” Said Samir Salem, who has served multiple terms as Chairman for the local NMA chapter as well as at the Executive Board.
The NMA Plaintiffs allege that in 2014 the NMA sold real estate property in Mission Valley and realized a substantial profit. The group wishes to see how that profit was distributed for the benefit of NMA members. “We have a right to request this information,” according to Basil Zetouna, a former NMA Chairman.
Over the years, the NMA Plaintiffs have heard complaints from NMA members regarding the lack of transparency in NMA affairs. The group is anxious to review various financial documents to see once and for all what is going on with the NMA’s account(s). “The NMA claims 2800 members and every member has a right to access this information,” said Arkan Somo, NMA’s co-founder and its first appointed President.
The lawsuit is the result of the NMA’s repeated failure to provide any of the requested information to the NMA Plaintiffs despite repeated requests. These NMA members are simply asking for information to which they are entitled under both the NMA bylaws and the laws of the State of California.
Linked here is a copy of the lawsuit.