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letter-from-america

Friday’s Letter from America

It’s that time of the week again, so welcome to this week’s Friday’s Letter from America, this week we publish Part II of Timeshare Debt and Hedge Funds. This article is from Justin Morgan and Michael Nuwer, with the introduction from our very own Irene Parker. But as usual a roundup from Europe.

It has been a very busy week in the courts again with many case being heard, with sentence still to be issued by the judge but there have been a few announced.

gavela

On Monday there were two announcements, the first was the judge of the Court of First Instance in Maspalomas found against Anfi, once again the contract was declared null and void, the client in this case will be returned over 12,000€ plus legal interest. The courts are certainly sticking to the letter of the law.

In the second case that was announced, the Court of First Instance in Tenerife found against Silverpoint (Resort Properties). In this case the judge found that the contract was in breach of the timeshare law 42/98 in that it exceeded the 50 years that is allowed, this should have also been explained to the customer before signing.

The judge declared the contract null and void, ordering Silverpoint to pay the client over £59,000 plus legal interest.

The following day, Tuesday, another sentence against Anfi was announced by the Judge of the Court of First Instance in Maspalomas. Another contract was declared null and void, with Anfi being ordered to return over 26,000€ plus legal interest.

Back in September Petchey Leisure (now MGM Muthu) was ordered to repay over 16,000€ and declared the contract null and void, by the High Court in Tenerife. The client in that case has now had the money transferred to their bank account.

On Thursday, there were three court sentences announced, Once again Anfi have been ordered to return over 20.000€ plus legal interest, this was by the Court of First Instance in Maspalomas. The judge also declared the contract null and void.

In Tenerife the Court of First Instance declared a Silverpoint contract null and void, ordering the return of over 30,000€ plus legal interest.

In the High Court in Tenerife, Regency Resorts was ordered to return £35,200 plus an extra £35,200 as double the deposit taken in the cooling off period, which is forbidden by law. This particular client will now be receiving £70,400 plus legal fees and legal interest. A nice Christmas present for this client!

Today as we this article was being prepared for publishing the following news was issued in a press release:

The Supreme Court in Madrid issued another damning sentence against Silverpoint, the Court ordered the return of the full purchase price plus double the deposit and all legal fees. The contract was also declared null and void. In this case the client will be receiving over £105,000.

All these cases have been brought on behalf of clients by the Arguineguin law firm Canarian Legal Alliance, who are certainly at the forefront in the field of timeshare law.

cla-brochure

Inside Timeshare is still receiving many enquiries regarding “claims” companies and “law firms” contacting owners with the promise that they have cases and can get their money back. Many of these readers don’t even own in Spain, or even upgraded in Spain since the law came into place in 1999, so how can these cases go to the Spanish Courts?

Some of these are also being told that they pay for a relinquishment, then the claim will be filed on a no win no fee basis. This can only mean one thing, an attempt to claim under Section 75 of the Credit Consumer Act 1974. Another aspect to this is the client will also be told at the meeting the only way they can do this is by purchasing another product! Sounds like the classic “bait and switch”!

There is also more news which at present we cannot publish as it has not been verified, so that is it from Europe, now on with our Letter from America.

Timeshare Debt and Hedge Funds – The Developer vs the Member

wall st

By Justin Morgan and Michael Nuwer

November 17, 2017

On Monday Inside Timeshare published an article comparing hedge fund involvement in Puerto Rico to hedge fund involvement in timeshare. Today we examine further how debt affects timeshare with help from Economics Professor Michael Nuwer and private equity investor Justin Morgan.

http://insidetimeshare.com/tuesday-slot-american-perspective-comparison/

Introduction by Irene Parker

As a Diamond Resorts member, I have access to information I would not have about other timeshare companies, so once again Diamond is used as an example with help from Michael Nuwer, also a DRI member, and Justin Morgan, a former DRI member, to explain the mechanics of timeshare inventory valuation and timeshare debt.

I asked Inside Timeshare Australian Contributor Justin Morgan how a company like Diamond can have a $2.2 billion dollar valuation when the entire inventory of points is worthless to the members, given so many complaints about the lack of a secondary market. Of course, there is value to staying at a property, but for discussion purposes, timeshares are a liability on an individual member’s net worth statement. Inside Timeshare has received 196 timeshare complaints from our readers against four major developers. The majority allege they were sold or upsold by deceit and bait and switch. I have interviewed many families devastated, sometimes just weeks after purchase.

In an article I wrote for TheStreet, I expressed concern over inventory valuation irregularities that delayed DRI’s second quarter 2016 earnings report, the last public report before being taken private. Diamond previously reported 11 quarters of consecutive robust earnings growth. After announcing the delay, just after the Apollo acquisition announcement, earnings had to be restated from 2014 going forward.

“After the correction, the change resulted in a decrease in net income of $5.6 million for 2015 and a $1.3 million decrease for the first quarter, in each case from amounts originally reported, according to the second-quarter release. Significantly, second-quarter net income decreased $10.1 million or 28.5% to $25.5 million year over year, compared with a first quarter increase of $8.4% or 32.6% to $34.4 million, prior to the restatement.”

https://www.thestreet.com/story/13702895/1/diamond-resorts-international-s-second-quarter-earnings-reversal-is-worrisome.html

Justin Morgan’s analysis

The whole industry itself uses some quite questionable inventory valuation methods that may be designed, according to some, to target more the financing arrangements that were the traditional model in the industry when GMAC and others were underwriting timeshare sales departments. This is why private hedge fund equity in the industry has somewhat caused a shift in thinking. If private equity is funding the model based upon equity vs loan models, the capital structures underneath begin to change. The same accounting reports will still be drawn upon to make sense of the numbers, but let’s not forget that inventory valuations do have a bit of leeway to move. Even financial reporting itself can diverge from standard reporting models, but it usually is flagged as a change in accounting methodology that would have otherwise tipped off Apollo.

Like Enron, it depends upon who’s looking, and who might be wanting to look away to get a deal done. Even if Apollo did know, it doesn’t mean they’d fess to the knowledge of spotting an irregularity if they believed they were able to profit in the end, and I believe that Michael Nuwer showed the sort of cap structure that Apollo introduced. It largely turned the debt into the membership, so whilst Apollo may have even noticed non-standard valuations, it might have only forced a better price to come from Diamond vs flagging the issue or walking away from the overall deal. Clearly, Apollo are their own beast in these type of private equity deals which reap profits and shift debt restructuring unwittingly into club members. This is a bigger issue. It’s like taking a loan out in someone else’s name and handing them the bill after you’ve taken what you want for the deal. Club members were only ever at Apollo-DRI’s mercy after this.

There are definitely some important and significant value-implied shifts from these numbers since the street uses earnings to make their valuations, but the valuation of inventory is an area that is somewhat suitable itself. The industry bodies know how to make it work and actually fought to use non-standard inventory models. But I’ve not gauged for differences between the pre-order hedge fund industry and the one we’re seeing rise out of the seas today.

I have looked with horror upon the entry of these private hedge funds because I know that they have little interest in the product itself. They are only in it to devour the membership of as much as they can get, and given the legal models, that could be the scariest evolution to date. At least cryptocurrencies attempt to establish some monetary supply rules, but timeshare clubs know that they can just keep raising budgets legally to cover their required rates of returns.

In an industry that generally looks for 30% per annum returns as a rule of thumb, that’s going to cause some high maintenance fee jokes in the future. But I remember the old DRI hiking maintenance close to 25% circa 2007 and then again in 2009. They first blamed a strong economy, whilst the second blamed the weak economy. More like a satyr blowing hot and cold in the one breath! But the disturbing thing to me is how Apollo financed this whole arrangement. They shifted the debt onto the members. They made their money from the start…The rest is just cream…The debt which now pays the Apollonian entities is the debt Apollo created and lumped into the membership at the financing stage.

We must be clear. They created the debt specifically to land it on membership; so really, it is as if the DRI members paid a good chunk of the deal. If the Attorneys General don’t see this, then they’ll miss what chicanery has been done here.

Michael Nuwer

Diamond reports show increasing levels of bad debt accompanied by decreasing membership since the peak in 2013.

chart1

Membership is down 9% since 2013

chart2

One thing that is not clear to me is the economic value of points. It often appears that a developer sells the points (say 10,000 points) for, say, $20,000. But, the next day, if I (the owner) try to sell those points in the secondary market, they are worth, maybe, $1,000. (If Bluegreen points; DRI points are worth $0.) The economist in me thinks the developer originally sold me points for $1,000 plus a club membership for the remaining $19,000. Thus, if my points are foreclosed and resold for the full $20,000, only $1,000 is the value of the points.

So, the question here is: what is the developer selling. Is the sale just vacation points or is the sale a bundle that includes points plus other stuff? I’ve read my DRI contract many times and still can’t tell what it specifically covers.

So what happens when someone buys timeshare points?

Let’s look at this example:

Say Diamond makes a sale for $30,000. The buyer might make a down payment of 20% or $6,000. The remaining $24,000 is a loan. Diamond now has a short term financing problem. They have $6,000 in cash and $24,000 in a non-liquid asset. But Diamond has immediate operating costs. A bit more than $15,000 from the sale is needed for advertising, marketing, and commission expenses. The carrying cost of the inventory must also be paid. Additionally, Diamond faces G&A costs (general and administrative) which need to be paid. All of these are current expenses, but Diamond only has the cash down-payments to cover them.

To pay current expenses, Diamond borrows money from a bank (the jargon is a “warehouse facility”). This facility is a credit line agreement, and, just like my credit card, Diamond’s credit line has a limit. Before Apollo, Diamond’s credit line was $100 million with Capital One.

In short: Diamond must borrow money from a bank to cover the current year’s expenses while it waits 7-10 years to get re-paid on the outstanding loans made to members.

Securitization of the outstanding loans is a way to oil, and thereby speed-up, the lending machine. Once Diamond reaches its $100 million credit limit, it will not be able to offer more loans for the purchase of points. Thus, to overcome this limit, the company bundles outstanding loans into a trust fund and sells shares in that fund as an Asset-Backed Security. The proceeds from selling these shares are used to pay down the credit line and Diamond’s perpetual loan machine continues.

Irene asked how Apollo Global Management will fare in their purchase of DRI. Will the restatement of inventory valuation have an impact?

DRI EBITDA in 2015 was $385 million and thus the valuation multiple ($2200/385) is a mere 5.7. Apollo got the company for a steal. If they can spruce it up and get 10x, the valuation will be $3.8 billion. There’s Apollo’s 30% profit.

trust earned

Thank you to Michael Nuwer and Justin Morgan for their analysis. I have nothing against private equity, but extraordinary investment returns at the expense of timeshare members or Puerto Ricans is not acceptable if so many complaint allegations are true. In addition to 192 Inside Timeshare readers who are timeshare members, I have interviewed ten current and former timeshare sales agents that all confirm predatory sales practices are widespread in this industry. There have been several recent investigations and settlements by Attorneys General including New York, Wisconsin, Missouri, Arizona, Tennessee and Colorado as well as lawsuits too numerous to mention. It is our hope developers will confront the problem and work with member complaints to improve the quality of timeshare sales today rather than continue to deny such practices exists. Contact Inside Timeshare or an Advocacy Facebook if you have timeshare concerns.   

Timeshare self-help Facebook groups

https://www.facebook.com/timeshareadvocategroup/

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

https://www.facebook.com/groups/180578055325962/

https://www.facebook.com/groups/465692163568779/

https://www.facebook.com/groups/1639958046252175/

Thank you to Justin and Michael, also to Irene for her introduction. This week Irene has been very busy dealing with the many enquiries we have received from US owners / members. Within an hour of publishing Tuesdays article, we received 3 pleas of help, these are sent to Irene who then makes contact with the relevant advice and which of our advocacy team can help. Keep up the great work US Team.

If you need any information or help with any timeshare matter and don’t know where to turn, Inside Timeshare is here to help.

Also remember to do your homework before engaging with any company that either contacts you or you find in an advert. This last one rings very true for one UK reader, She found an advert in the Royal British Legion Magazine for a company that said it could help with a claim. Being in the British legion magazine she believed it would be genuine, well we all would! Unfortunately, adverts are not checked for authenticity, they are sold by a marketing company to pay the cost of publication, the same is also true for any newspaper or magazine. So the it proves that you need to do your homework!

On that note, Friday is here, the weekend is once again upon us, so have a great weekend and we will be back on Monday.

friday dog

 

job_losses_ahead_road_sign

Diamond Close European Sales Decks.

Last Friday, Inside Timeshare was given the following news, Diamond Resorts Europe have given notice that all their sales decks are to be closed forthwith. Sales staff in Malaga and Tenerife have been instructed to see a solicitor within the next 15 days, as there will be major redundancies.

So what is happening?

According to a letter passed to Inside Timeshare from a member, they are being informed that the European Sales and Marketing business has for sometime been facing a rather difficult time, in other words sales targets are not being met.

dri logo

Diamond state they have implemented a number of initiatives attempting to improve the performance of the European sales teams, but have admitted that it has not worked.

Therefore, Diamond have been forced to drastically reduce their sales and marketing operations in Europe, this is also subject to consultation with their team members. This is obviously a great blow to many of the sales staff around Europe, as Diamond are one of the major players, with sales decks all over Europe.

Diamond have gone on to add and reassure members this will not have any affect on their holidays, stating that “Diamond Resorts International continues to be a strong leader in the global hospitality and vacation ownership industries”. They also go on to say that any members wishing to purchase and increase their points ownership, will be able to as there will continue to be a dedicated team at their disposal.

It appears that there will be a few sales decks still operating , one has been named as Pine Lakes, in the UK, another is reportedly one of Diamond’s flagship resorts in Malaga, Sahara Sunset, with a apparently two remaining in Tenerife. These will obviously be run on skeleton staff.

At present it does look like it is mainly Diamond run sales decks, as yet we have not heard if it will affect any of the franchise decks, which did undergo a similar cut back earlier in the year.

This news is not that surprising, sales in timeshare resorts has been declining over recent years, the product has changed from the very first timeshares, where you bought a fixed week in a fixed apartment. Since then we have seen a move to vacation club membership rather than resort ownership, these clubs use the floating weeks and points systems, which offer only a right to use, subject to availability.

It must also be remembered that the way people book holidays is very different today, with many timeshare resorts available on various websites. Which is one of the main complaints from members, why did we purchase for so many thousands and yet non members can book at a fraction of our maintenance fees?

In the early days of timeshare it was also the quality of the resorts available that helped to sell “the dream”, after all, most package holidays were in not very desirable hotels. But again the hotel industry has improved, quality is very much on the agenda, with many hotels in recent years undergoing drastic renovations.

Another aspect for the decline in timeshare sales is obviously the all inclusive packages, again a week’s holiday for a family of 4 can be purchased for less than the average yearly maintenance fees.

future

So what of the future for Diamond sales in Europe?

To be perfectly honest, not good, many operators are scaling back their sales teams, timeshare is in decline, many owners / members are elderly, with children that do not want to take it over. What we call the internet generation, who have grown up with the unlimited availability on the web, without the initial huge outlay for membership.

Another question that has been posed, is what about Apollo in all this, could it be a move to also separate the US arm of Diamond from the European arm, a possible sell off?

As usual only time will tell, but for now, it would look like there are going to be a lot of ex sales staff looking for work in an ever diminishing industry.

Inside Timeshare will keep you posted on any latest news. If you have any comments on this subject or any other published, we welcome it as it helps to keep others informed.

 

letter from america

Friday’s Letter from America

Welcome to this week’s Friday’s Letter from America, somehow we think that when you have read this story you will be shocked, we certainly were.

shocked cat

Inside Timeshare heard from its first US timeshare member seeking advice one year ago. Like today, it was a Hispanic family. We in Spain feel like first cousins to American Hispanics, so are particularly affected when we hear one of our own might be faced with the possibility of foreclosure.

http://insidetimeshare.com/irene-parker-write-barclay-card-usa/

When the resort says no, a family may have no choice but to consider foreclosure. There is no one company to blame. Deceit on the front end of the timeshare sale has been talked about since timeshare began. The industry has had its ups and downs, but the emergence of the “right to use” point programs seem to have escalated timeshare complaints and lawsuits from both sides of the fence. There has been a flurry of developer lawsuits against exit, transfer or claims companies targeting members desperate for help, as well as lawsuits against lawyers practicing questionable business practices. Legitimate law firms are not immune.  Several Attorneys General in America have been investigating various timeshare companies.

Caught in the middle is the timeshare member, like the Vargas family. Hoping to warn the general public as well as existing timeshare members, to the danger of buying something that cannot be sold, Deneise Vargas shares her story.

How easily a Vacation Plan can result in Foreclosure

Hispanic

By Deneice Vargas

September 29, 2017

woman 1

I had hoped Diamond Resorts would help us. A hospitality agent had told me to supply medical documentation about my husband’s medical condition, so I thought they had listened and responded in a positive way. I then learned the person I had spoken with had quit. The person who replaced her said they would not help us because Louis got Bell’s palsy a week before we signed the timeshare contract. Bell’s palsy is not the flu! Symptoms include muscle weakness, drooling and an inability to make facial expressions. Just because a person has not been diagnosed, does not mean they are not suffering from a disease.

In dollar terms, this is what we are facing:

  • Current Loan Balance: $93,671 financed at 13.5%
  • Paid already: $76,627
  • Current Maintenance Fee: $6,948
  • We have accumulated 67,500 vacation points

Why buy so many timeshare points?

We purchased a timeshare at Polo Towers in Las Vegas and at Palm Canyon. We were never told maintenance fees would go up each year. With the loans and the maintenance fees, we have used all our savings.

At the Las Vegas sales presentation, the sales manager threatened to have our first sales agent from Palm Canyon in Palm Springs, Tim, fired because it was not legal, per them, for Tim to hold a price for us. The manager got on my phone, speaking to Tim, chewing him out. I was so upset I started to cry. I was confused and did not know what to do. We signed that contract so Tim would not be fired. They opened and charged a Diamond Barclaycard because I did not have enough money. Another $3135 was charged to two different Visa cards. Last July we had to refinance our house to pay off the credit cards.

We went to Las Vegas twice in 2015.  They told us we had to attend an informational meeting about Apollo Global Management because Apollo had purchased Diamond. They said it was not a sales presentation. They lied because they again tried to sell us more points. We were told we should buy more points because we could use points to pay maintenance fees and buy plane tickets and other things. We were not told Platinum members can only use points to pay maintenance fees at four cents a point or that a vacation point is only worth pennies per point if used to buy plane tickets.

In 2016 we went again to Palm Canyon Palm Springs. Tim introduced us to Dan Vendl. Dan explained the benefits of being trial Platinum. I hesitated because the money was going. Dan said there was a company we could refinance with that had a better rate than Diamond, so our payment would be less. That was not true.

We were told “We are real estate agents. You can write off the interest paid and closing costs on these contracts because it is like real estate.” They said the proof was because they have real estate licenses. They are licensed real estate agents, but what they told us was not true. Our accountant said we were not allowed to take any deductions. We were told we had to buy that day so we could not talk to our accountant.

Anytime we check in, they harass us to do another update.  In Las Vegas while checking in, the woman wanted to follow me to the parking garage to get Louie to change his mind even though I had told her NO. She said she needed for us to participate so she would get credit.

We have cancelled other Diamond contracts after signing. One reason was our 16 year old granddaughter was dying of brain cancer.  My son had already lost his wife to cancer and we were helping him.

Now Las Vegas Polo Towers has been calling again. Binni Thomas and his Supervisor Melvin say we need to upgrade to 50,000 points to become permanent Platinum members.  Again, we are told we should never have been given a $3.30 price per point. He said the points are now selling for $8.70 each and that is what we should pay.

I told him No!

operators

Social Media helps. At least we know we are not alone. If you or someone you know does not know where to turn for timeshare help, contact Inside Timeshare or one of the self-help Advocacy Group as members work to help other members find the next step.

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

https://www.facebook.com/timeshareadvocategroup/

https://www.facebook.com/groups/180578055325962/

Now that you have read this story, do you not agree that things must change?

This type of selling must not be allowed to continue, whether it is in the US, Europe or anywhere else in the world. At least In Spain the law is on the side of the consumer, Spain now has some of the strongest laws relating to timeshare in the world. It is through the efforts of law firms such as Canarian Legal Alliance that have brought this about.

The rest of the world take note, have a good weekend.

friday cat

letter from america

Friday’s Letter from America

Welcome to another edition of Friday’s Letter from America, today Irene Parker asks the Florida Attorney General Pam Bondi, What about us? Ms Bondi seems to have a reputation for backing big business rather than the consumer, but more of that in Irene’s article. As usual we begin with what is happening in Europe.

CLA Logo

Some news which was breaking yesterday has now been confirmed, Canarian Legal Alliance issued a press release informing us of the latest Supreme Court victories.

Legal history has now been made with CLA achieving their 60th victory in Spain’s highest court, we say legal history as this is unprecedented. No other law firm has ever managed to get this number of cases through the Supreme Court. This is a fantastic achievement since their first victory in March 2015, in the past two and a half years they have not only made history but have also made law.

Their latest victories have been against Silverpoint, in sentence number 59, the court ordered the return of over 65,000€ plus the payment of First Instance legal fees and legal interest. The client’s contract was also declared null & void, which now makes them timeshare free with no more ongoing maintenance fees.

With sentence number 60, the same court ruled that the contract be declared null & void, ordering Silverpoint to return over 92,000€ plus Appeal Instance legal fees and legal interest. This now makes a total of 21 judgments from the Supreme Court against Silverpoint alone.

Then the following day, the Judge at the High Court Number 3 in Tenerife, followed the Supreme Court rulings declaring another client’s contract with Silverpoint null & void. The judge also ordered the return of over 11,000€ plus legal interest.

Not only must the clients be celebrating, but I will wager there was some celebrating going on in the Lawyer’s office!

amador-galeca-300x191

Following the publication of yesterday’s article on the new fake law firm Amador Galeca Abogados, we received an email from a reader who has already been taken in by them. Unfortunately they have already paid the Procurator a fee, but at least it was not a large sum, yet something prompted them to start checking the internet for information before they paid them next amounts.

As we said yesterday it would only be a matter of time before we found out the new name of the Procurator and the bank account they are using, here it is:

Procurator: Graham Ingum Gorrin

Address: C/ Layanva, Edif Colmenas, Oficina 2223, 38003, Santa Cruz de Tenerife.

Bank: Deutsche Bank Sociedad Anonima Espa, C.P.A. BCN, Ronda General Mitre 72-74 Barcelona.

IBAN: ES3900190172854010033761

As for the address of the procurator, searching on google and google maps it does not exist, so any post sent there will obviously never be delivered.

This reader has also supplied some new and interesting information, Amador Galeca informed them that the directors of their timeshare had pleaded guilty in court and that all their assets had been seized, not bad, it seems that all the directors according to this group of fake law firms plead guilty!

The amount paid was for a relinquishment through the Spanish courts, which needed to be done first before they could go to court for compensation. The strange thing is, once again it seems that the jurisdiction of the Spanish Courts now extends beyond the borders of Spain and encompasses timeshare in the UK!

These readers have been lucky, they have not lost a huge amount, they have also informed their bank who is going to issue an alert to all other banks.

This does prove the point, never believe what you are told, especially when it comes to timeshare,

IF IT SOUNDS TOO GOOD, STOP THINK AND DO YOUR HOMEWORK!

homework

Now on with Irene’s article.

Florida Attorney General Pam Bondi – What about Us?

Irma Iniki and Timeshare

most people

By Irene Parker

Friday September 22 2017

Florida Attorney General Pam Bondi expressed her outrage over price gouging during hurricane Irma. While her dismay is understandable and commendable, why has there been so little effort expended to come to the aid of Florida timeshare buyers alleging they were deceived into buying a timeshare? Nationwide there have been lawsuits and Attorneys General investigations too numerous to mention.

Ms. Bondi has been quick to investigate timeshare resale scams.

Florida Attorney General Pam Bondi has filed a lawsuit against a company she accuses of violating Florida’s Timeshare Resale Accountability Act.

Florida has a specific law covering timeshare resales because it has so many of the properties, whose owners are often desperate to unload them.

In this latest case, Bondi sued Prime Resorts International, based in central Florida. She accuses the company of making telephone calls to timeshare owners all over the country, telling them they have a buyer for their timeshare. She says the company also claimed to be able to guarantee the deal would close.

https://www.consumeraffairs.com/news/florida-sues-another-timeshare-reseller-031116.html

The Berkley Group

Sources tell us Ms. Bondi is investigating The Berkley Group. The Berkley Group owns Vacation Village Resorts. With a BBB rating of F, looking into this company is a start, but acting on only 110 out of 2,360 timeshare complaints filed from April 2012 to April 2014 seems underperforming at best.

https://www.bbb.org/south-east-florida/business-reviews/timeshare-companies/vacation-village-resorts-in-fort-lauderdale-fl-4003645/reviews-and-complaints

Ms. Bondi opened this resale investigation after receiving 85 complaints.

The attorney general opened her investigation after she said her office got more than 85 complaints, claiming to have lost more than $110,000. The suit seeks a permanent injunction against the company, consumer restitution, and a civil penalty of $10,000 per violation.

Inside Timeshare has received 144 timeshare complaints of which 130 allege they were deceived on the front end of the sale. The dollar amount in question concerns well over one million dollars. The 14 not alleging deceit say they seek relinquishment because they say they cannot afford the annually increasing maintenance fees. ARDA and the industry continue to ignore deception exists, and with lawmakers turning a deaf ear, the court of public opinion seems the only avenue open for families reporting how they have been financially devastated by their timeshare plan.

follow money

Timeshare revenue in Florida is a lot of dollars to tamper with.

As the state’s No. 1 industry, tourism is crucial to Florida’s economy – generating 23 percent of the state’s sales tax revenue and employing more than one million Floridians. In 2011, tourism was responsible for welcoming 86.5 million visitors to Florida and generated $67.2 billion in direct economic impact.

http://www.flgov.com/governor-scott-applauds-floridas-tourism-marketing-2/

The industry will be quick to respond that there are nine million who own timeshares. What difference does a couple hundred families make? It makes a world of difference to the families affected who have contacted Inside Timeshare.

Recently, the Finn Law Group took issue with the lack of disclosure provided to timeshare buyers. If feeling deceived, after spending $5,000 to over $500,000 on a vacation plan, families are shocked to learn their timeshare has no secondary market and the contract is perpetual. Contracts are deceptive in that they often state points can be sold. Buyers are not informed about the lack of buyers should they need to sell.

LARGO, Fla.–(BUSINESS WIRE)–An administrative petition has been filed against Florida’s Department of Business and Professional Regulation alleging that the agency’s approval of a request by timeshare developers to make statutorily mandated public offering statements available by providing an online address at the closing rather the furnishing hard copies violates Florida law.

http://www.businesswire.com/news/home/20170905006015/en/Finn-Law-Group-Files-Petition-Florida-Agency

Ms. Bondi appeared on Las Vegas Attorney Bob Massi’s Property Man Show in 2016 explaining how the Florida Attorney General’s office worked with ARDA and the Department of Justice to shut down timeshare resale or release scams. Mr. Massi encouraged timeshare members to contact a member of the Licensed Timeshare Resale Broker Association if they need to sell their timeshare. When I contacted LTRBA about selling our Diamond timeshare points, I was informed by several LTRBA members they know of no licensed LTRBA broker who will even accept a listing for our points due to secondary market restrictions.

https://www.youtube.com/watch?v=VHCdcS2Ds-U

Inside Timeshare has also started hearing from Bluegreen members. One member is Lela Renea, a Bluegreen member and a detective. Lela Renea says she was deceived into buying a timeshare. If a Florida detective, allegedly reports being a victim of deceptive sales, what chance does the average timeshare buyer on the street have?

http://insidetimeshare.com/fridays-letter-america-11/

When I wrote an article for TheStreet, Jim Cramer of Mad Money’s investment news service, challenging what is in my opinion gestapo like tactics demanding Diamond members stay vacationed, Diamond demanded a rebuttal, stating they understood life’s changes could render their product a liability so they were introducing a program called Transitions that would allow qualified members in good standing a way out. That was June of 2016, yet the company has yet to introduce the program. “Qualified” is the key word. Most members contacting Inside Timeshare have loans, and many allege they succumbed to high interest rate loans and credit cards after hours long aggressive sales presentations. A timeshare must be unencumbered to be eligible for any voluntary surrender program.

https://www.thestreet.com/story/13624491/1/is-apollo-returning-to-its-junk-roots-with-its-acquisition-of-diamond-resorts.html

“Is Apollo Returning to its Junk Roots?” is the article Diamond found objectionable. Most remember the subprime mortgage crisis, but a decade earlier was the Drexel Burnham Lambert junk bond scandal that sent Michael Milken to jail for securities fraud. DBL founder and banker Leon Black filed bankruptcy on DBL only to reform and rebrand as Apollo Global Management, purchasing Diamond Resorts in 2016. If DBL liked junk bonds, which had some value, timeshare points that have no value the moment the contract is signed, should a buyer need to sell, must seem attractive.

Hurricanes and Timeshare

hurricane

One of the top complaints Inside Timeshare has received concerns upsells by timeshare sales agents on the US mainland selling against timeshare agents in Hawaii. This would be normal competition were it not for the fact the dueling agents work for the same company. Buyers tell us sales agents on the mainland side tell existing members they should not have purchased a Hawaii timeshare because of damages from hurricane Iniki that struck Hawaii on Kauai in 1992. They are encouraged to buy more points and transfer to US mainland points, despite Florida resorts included in their purchase. Obviously, Florida is at risk for hurricanes.

pam bondi 1      Ms. Bondi, please listen to us. The Arizona Attorney General has received over 900 timeshare complaints about Diamond Resorts:

http://insidetimeshare.com/arizona-attorney-generals-assurance-discontinuance/

Wyndham former timeshare sales agent Trish Williams was awarded $20 million by a jury concerning overly aggressive and predatory timeshare techniques:

https://www.nytimes.com/2016/11/25/business/my-soul-feels-taller-a-whistle-blowers-20-million-vindication.html?mcubz=0

Eric Schneiderman’s $6.5 million settlement with The Manhattan Club:

http://nypost.com/2017/08/17/new-york-ag-reaches-6-5m-settlement-with-manhattan-club/

In addition to member families,Charles Thomas at Inside Timeshare has heard from eight current and former timeshare sales agents alarmed at the escalation in predatory sales. The following comment made by a former experienced sales agent mirrors the others.

“I watched every day, agents selling DRI for double and close to triple what it was supposed to be sold for but management laughed and congratulated them for doing it.  The maintenance fees statement about buying more and using that to pay your maintenance fees was a practice that was encouraged, but be careful.  Some of the agents, who still work at DRI, would sell the program for $98k when it was only in the 50k range.  One of the guests came back to cancel but the agent said no worries, “I have it packed 40k but I’ll give then 15 off and still make a killing!”   This made me sick because these particular guests were in their late 70′ early 80’s.  I asked the agent if he had a conscience and he just laughed…if you can get them to pay more you’re a hero!!  They have the money!!

Deception actually goes back further than that.  We were told to pack the price for a trade in and imply that it was what they got back for their TS… we sold it for the regular price….they got nothing for their TS!”

(Charles Thomas, editors note: we have published on many occasions on the “stack and drop” tactic. This has been used for many years and we have seen it throughout Europe. It is used as a tool for upgrading or poaching other companies members. The consumer then believes they have had value for their other purchase).

It is our hope Diamond Resorts will listen and respond, along with Wyndham, Bluegreen and others, to improve timeshare sales today after the rise of “right to use” programs. In my opinion, such programs leave wide berth for misrepresentation and deceit.

The following are self-help Facebook pages representing over 1000 timeshare member families:

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

https://www.facebook.com/timeshareadvocategroup/

https://www.facebook.com/groups/180578055325962/

A few of the 144 families who have contacted Inside Timeshare:

Marsha, Ann and Marjorie

http://insidetimeshare.com/fridays-letter-america-18/

Bonita Hill

http://insidetimeshare.com/tuesday-review-clarity/

Eron Grant ARDA’s Code of Ethics

http://insidetimeshare.com/fridays-letter-america-14/

Irina Allen

http://insidetimeshare.com/monday-start-another-week/

Justin Morgan and Michael Nuwer June 30, 2017

http://insidetimeshare.com/fridays-letter-australia-no-read-correctly/

Alan Callner

http://insidetimeshare.com/wednesday-article-america/

Detective Lela Renea

http://insidetimeshare.com/fridays-letter-america-11/

David Franks Chapter 4

http://insidetimeshare.com/fridays-letter-america-15/

Karen Garello Secret Shopper June 22, 2017

http://insidetimeshare.com/works-industries-not-timeshare/

Romeo and Lily

http://insidetimeshare.com/fridays-letter-america-9/

Dr. Jeffries

http://insidetimeshare.com/fridays-letter-america-7/

Angela Johnson

http://insidetimeshare.com/timeshare-advocacy-group-update/

Neina Orrillo

http://insidetimeshare.com/diamond-in-the-news-again/

Barclaycard and Member stories May 17 2917

http://insidetimeshare.com/timeshare-barlcaycard-us/

Marjorie Menacker

http://insidetimeshare.com/another-nightmare-timeshare-street-client-experience-diamond/

Eron Grant May 12, 2017

http://insidetimeshare.com/fridays-letter-america-4/

Barclays Bank Charles May 11, 2017

http://insidetimeshare.com/timeshare-finance-barclays-hot-water-high-court/

Nancy Callahan April 24, 2017

http://insidetimeshare.com/another-nightmare-timeshare-street/

A Filipino Family April 13, 2017

http://insidetimeshare.com/anatomy-timeshare-foreclosure/

Laurie Sabbagh March 17, 2017 Clarity Review

http://insidetimeshare.com/friday-review-news-across-ocean/

A Military Family March 6, 2017

http://insidetimeshare.com/consumer-protection-week-usa/

The Hurleys January 25, 2017

http://insidetimeshare.com/timeshare-advocacy/

Irina Allen January 13, 2017

http://insidetimeshare.com/timeshare-news-across-atlantic/

Kathie Old December 6, 2016

http://insidetimeshare.com/call-change-us-timeshare-industry/

Wyndham Trish Williams $20 Million Whistleblower Jury Award December 5, 2017

http://insidetimeshare.com/wyndham-whistleblower-update/

The Peasant of Venice and the Queen of Versailles November 7, 2017

http://insidetimeshare.com/peasant-venice-queen-versailles/

Sylvia Saldana and the Barclaycard October 25, 2016

http://insidetimeshare.com/irene-parker-write-barclay-card-usa/

Hug Your Haters! By author Jay Baer on the importance of Social Media

http://insidetimeshare.com/customer-service-message/

need you

Will anyone listen? Author Jay Baer is to be keynote speaker at the upcoming October Interval International Shared Ownership Investment Conference, attended by developers and private equity firms. In Hug Your Haters, Mr. Baer strongly urges companies to listen. Members are hopeful, but doubtful, developers will listen to him.

Thank you Irene and those that proof read your article and gave advice, timeshare is a crazy world, which is such a shame as it is a great idea, with many who have enjoyed it for many years. There are some very good developers and resorts, but the reputation of the industry is being spoilt by a few.

Have a great weekend.

weekend-picard

         

 

letter from australia

Friday’s Letter from Australia (No, you have read that correctly)

Welcome to Friday’s Letter from (America) now Australia, this is just to confuse our American cousins, the reason is that we welcome our first Antipodean cousin to our pages. Justin Morgan, makes his debut with his first contribution to Inside Timeshare. It is ironic that it happens to be on the first anniversary of Irene Parker’s very first article, which was about the acquisition by Apollo of Diamond.

Since her first article, Irene has been a major contributor and very much a driving force in bringing the problems of owners in the US to the fore. She has also become a very valued friend not just to myself but to all those she met while visiting Gran Canaria.

But enough of that, how about some news of timeshare in Europe?

Diamond Resorts has had a battering in the courts in Tenerife, Canarian Legal Alliance has secured a victory for one of their clients with the High Court declaring their contract null & void, with the return of over 29,000€ plus legal interest. In this case the court stated that the contract did not contain specified information required by law, with the product being the points system which the Supreme Court has deemed illegal due to their lack of tangibility.

This is the fourth verdict delivered against Diamond by the Tenerife courts this year, which our sources indicate is just the tip of the iceberg!

justice2

Anfi, based in Gran Canaria is on the defensive, it would seem they are already sending out new contracts after the vote last Friday 23 June, which coincided with another defeat at the High Court in Las Palmas. In that case the court declared the contract null & void as it was for more than 50 years.

As this is being written, the news has just arrived from our contact at the Court of First Instance in Maspalomas, that another contract has been declared null & void, with the client being awarded over 35,000€ plus legal interest.

At the same court yesterday Palm Oasis / Tasolan, were ordered to repay over 31,000€ and declaring the contract null & void. In this case the court ruled against the points system, which it deemed as selling nothing but promises.

On the Tauro Beach project, which has been the subject of many articles, it seems that the beach is still closed to the public, although many people are ignoring the fences and entering the area. There still seems to be no indication when this area will be fully open to the public, it may not be for sometime yet as there are several court cases pending.

So now on to this weeks article.

Who is Apollo? What is Apollo?

Two Diamond Member Consumer Advocates offer their opinion

Up Down

By Michael Nuwer and Justin Morgan

Introduction by Irene Parker

June 30, 2017

In honor of my one year anniversary writing for Inside Timeshare, it is only fitting to revisit Apollo Global Management’s acquisition of Diamond Resorts as Apollo’s Diamond acquisition was the subject of my inaugural article June 30, 2016.

http://insidetimeshare.com/700-2/

I had been shouting my timeshare concerns from the rooftops since my husband I attended a pathetically aggressive sales presentation July 2015 at Diamond’s Grand Beach Resort, which ultimately led to our appearance on the FOX News show Property Man, interviewed by Las Vegas attorney Bob Massi.

http://insidetimeshare.com/peasant-venice-queen-versailles/

The first I heard from Diamond was a year later in reaction to my Apollo article written for Jim Cramer of CNBC’s Mad Money’s investment news service, TheStreet. Diamond contacted TheStreet demanding a rebuttal. Diamond members are still waiting for Transitions, a relinquishment program that must still be in development.

http://www.thestreet.com/story/13624491/1/is-apollo-returning-to-its-junk-roots-with-its-acquisition-of-diamond-resorts.html

Diamond boasted 11 quarters of robust earnings growth until shortly after the Apollo acquisition announcement. A delayed 2016 second quarter earnings report was attributed to accounting irregularities.

http://www.thestreet.com/story/13702895/1/diamond-resorts-international-s-second-quarter-earnings-reversal-is-worrisome.html

According to a May 2017 KROLL Bond Report, Diamond’s default rates remain elevated.

The collateral pool of DROT 2014 – 1 has experienced elevated levels of defaults, which similar to certain other vacation ownership companies in the industry, Diamond Resorts attributes to an increase in the number of borrowers who have been solicited by lawyers to get out of their timeshare and/or have sent Diamond Resorts “cease and desist” letters.  

https://www.krollbondratings.com/announcements/3705

A National Mortgage News article appeared indicating the interest rate on the Apollo acquisition was raised due in part to the earnings restatement. Earnings had to be restated back to 2014 resulting in an earnings decline from the prior earnings report. Since the merger was announced as an all cash $2.2 billion deal, I did not understand the comment about the raised interest rate.

advocate 1

We seek to provide Diamond Resort members a way to proactively address membership concerns; to advocate for timeshare reform; to obtain greater disclosure from the company; to advocate for a viable secondary market; and to educate prospective buyers.

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

Timeshare Advocate Michael Nuwer explains. I now understand what it meant when Diamond owners were informed Diamond is owned “by an affiliate of an affiliate of funds.” It’s pretty high finance.

Apollo Global’s acquisition of Diamond Resorts was organized as a “leveraged buyout”.  Here’s how the deal worked:

Apollo created a shell company called Dakota Parent. Four of Apollo’s investment funds own this company. Dakota Parent created a wholly owned subsidiary called Dakota Sub. Dakota Sub borrowed $2.2 billion dollars (a big chunk of it, $1.1 billion, from the four Apollo funds) and bought 100% of the DRI shares — 72.7 million shares at $30.25 each. Then DRI merged into Dakota Sub, changed the company name to Diamond Resorts International, and thereby took on all Dakota Sub’s debt. This is the way leveraged buyouts typically work. Former Diamond CEO Cloobeck used the same structure when he bought Sunterra in 2007.

Now that all is said and done, DRI is a wholly owned subsidiary of Dakota Parent. The equity in Dakota Parent is owned by the four Apollo funds. Diamond has $2.2 billion debt on which it must make interest payments. The primary lenders are the four Apollo funds. They are in for $1.1 billion, $500,000,000 at 7.75% and $600,000,000 at 10.75%. The secondary lenders are in for $800 million, and another $200 million is secured by some DRI assets (I think they are consumer loans).

There are two ways Apollo makes money on this deal assuming all goes well. First, the four Apollo investment funds receive interest income out of DRI’s cash flow. They are guaranteed $103,250,000 per year. High profits or low profits, it doesn’t matter, Apollo gets paid. Further, the Apollo investment funds own a claim to all the equity growth of the company (that is all value over $2.2 billion). Thus, if they can sell the 72.7 million shares for $45 each, not an unreasonable number if all goes well, Apollo’s capital gain will be about $1 billion.

Aussie Flag

From Justin Morgan Australia

As a tax accountant, finance planner, part time private equity guy, I completely agree that the Apollo deal will only end in debt being laid upon Diamond members, for the benefit of those who arranged the details of a LBO merger that, when combined with the liabilities of the timeshare structure that utilized Association Board powers and targets them, it becomes a lethal mix that allows financial dealers to write their own checks bigger each year. It seems there is no end to how high they could simply raise their own salaries, pay-outs and ‘returns’ towards simply legally expecting members to pay their share of these increased contributions.

In the economy, we have certain protections such as Trade Practices Acts, Fair Trading Laws, financial regulation, monopoly laws…All this is designed to prevent abuse of market power. In my opinion, I would characterize this Diamond set-up as worse, because there is NO market that is anything other than what DRI, and the timeshare industry in general, allows. It is engaging in practices specifically designed to restrict the market to only it and its approved associates.

I feel this exploits consumers at near will, and I wonder where Apollo will set their ceiling …Looking at how the deal was structured, they see huge opportunity to lend to a membership base locked up in dubious legalities and unfair contracts. All this would not be legal in Australia. I’m amazed at how it turns out to be in the US. And I write this from Mexico, where it is well known what happens when dangerous cartels form and throw their money around here.

Circumstantial evidence is that the proof is in the pudding, but proving it in the US, where the banks and private equity already got away with much…well, I can only hope that the powers that be realize that it won’t get better if they keep allowing the average consumer and householder to be abused by what is, in my opinion, predatory sales and lending.

If the new DRI were to strip assets, it’d be left holding the large liabilities, but that is usually the reason why they then go back to legacy members warning of bankruptcy if they do not buy more points. It looks like the new DRI is just financially ‘creating’ this balance sheet to look exactly how it should look to siphon off more money from members. They already have their interest windfall. Next would be the stripping, and finally, the call for more contributions to boost management revenue…all this whilst the members are forced into more debt.

This is a strategic type play from the banking world, but DRI and private equity were some of the quickest learners out of the Great Financial Crisis. Many learnt how the banks do it. Private equity rushing into timeshare is the new rush to create financial instruments that creates only ‘liability’ for the timeshare owner. The financial guys profit from the creation of liability, which is their ‘debt-holding’. In a near zero interest rate environment, Apollo is looking to create the debt, then shift it across to the membership…effectively, they’ve already done it. Now they must get their $1.1bn back, and the result is just pure profit for the financial players. This could turn out to be a textbook case of why this must be stopped immediately. It will possibly play out over years.  Bravo Irene for taking a stand. I will support your efforts however I can. You’ve struck here what I believe is the actual core of the New Timeshare. The Old Timeshare was less sophisticated, but for those of us who know that private equity in this industry is licking its lips over several recent acquisitions, the old caveat of “buyers beware” may even be too late.

Teacher

Thank you to Michael and Justin for their reader responses which are possibly the most sophisticated reader responses in the history of Inside Timeshare. More and more timeshare Advocates are coming forward bringing their expertise and experience to the timeshare table.

Contact Inside Timeshare or one of our Timeshare Advocacy Group™ Facebooks or websites if you need timeshare assistance or can become an Advocate.   

So there we have it, another week over in the murky world of timeshare, Inside Timeshare thanks Irene for her efforts in bringing so many people together to share their views and experiences.

To our latest addition to the Inside Timeshare family, a very hearty welcome and we hope to hear more from those in the “Land Down Under”, who we do tend to forget share the same experiences as us in Europe and the US.

It’s Friday, the weekend is here, so break out the BBQ’s and let’s PARTY!!!!!!!!

barbie

letter from america

Friday’s Letter From America

Welcome to this week’s Letter From America, from Irene Parker, as usual in her own style she explains what is happening across the Great Lake, but first a look at the week’s news in Europe.

Inside Timeshare is receiving many questions about the Anfi SGM and the vote to change the constitution, it seems to be causing a lot of confusion. No one seems clear as to what it is all about, so in a nutshell here it is.

Voting on Resolution 1

To establish occupancy periods for a maximum of 50 years duration, with an option to extend for further recurring occupancy periods of 50 years.

This will bring the contracts in line with the 50 year rule established in Spanish timeshare law, but it allows you to extend voluntarily to another 50 years.

Voting on Resolution 2

To limit the duration of the Timeshare Scheme to a maximum of 50 years.

The same as resolution 1 without the option to extend to another 50 years.

Voting on Resolution 3

Total change of Timeshare Scheme to adapt to Spanish Act 4/2012.

This adapts the contract to  “Rotational Enjoyment Rights” Anfi explains it thus:

“Every current holder of a membership certificate shall be allocated a number of rotational enjoyment rights, equal to the number of membership certificates they currently hold and which will entitle them to enjoy the same week of use as they currently hold”.

It will not make any difference unless you accept the new contract and sign them, it will however affect any new sales and those contracts.

As usual it is framed to confuse, why is it that anything to do with timeshare is made complicated, confusing and difficult for mere mortals to understand. Well, quite simply that is how they sold it to you in the first place!

The courts in the Canary Islands have been busy again this week, with many cases against timeshare companies being heard. Some of these sentences have yet to be announced, but as usual, we think we all know the outcome!

It has also just been announced that another ex-Anfi owner who won their case some time ago, has now received into their bank account the awarded amount. Their contract was declared null & void and now they can enjoy the 15,531€ as well as being timeshare free.

We have also been inundated with enquiries into several “claims” companies, all offering claims on a no win no fee basis. Then comes the crunch, they want several thousand pounds upfront! Obviously this is to relinquish the timeshare then the claim will be pursued, this claim is more than likely to be under the Credit Consumer Act 1974, Section 75. Which as we have stated before will not get paid out as the purchase was more than likely over the 6 year limit, (limitations act) or the fact that they will say you have received the goods and services as you have used the timeshare.

Again it pays to be cautious, so on with our Letter from America.

A Tina Timeshare Pinocchio Tale

Told by a Wyndham owner, possibly foreclosed by now, Mr. Patrick

pinocchio

By Irene Parker

June 9, 2017

Wyndham member Gene Patrick was one of several Wyndham owners to go to the trouble of making a YouTube about his timeshare trouble, continuing on with our “Nightmare on Timeshare Street” series.

Comments ranged from “this is the most boring video I’ve ever watched” to “this is the most informative video I’ve ever watched.”

Mr. Patrick is a videographer. I side with the latter, although the video is long at 45 minutes. Mr. Patrick is also an effective storyteller, but for those who would rather read a short article than watch the video, here are the seven lies (allegations) he described. He seemed to lose count after three, but I believe I found seven. Mr. Patrick did provide a disclaimer stating these were his opinions or allegations, a word I have come to detest in that, even if only half the highly educated and professional people asking Inside Timeshare for assistance with their timeshare troubles are telling the truth, Timeshare has a problem.

https://www.youtube.com/watch?v=Q218fyTmYpc

The back and forth comments among the 244 respondents sound familiar. Timeshare Facebooks that maintain a quota of happy vs angry members, admonish the angry members as irresponsible suckers that should have known better. Lawmakers and timeshare developers seem to agree with those hurling insults.

A Timeshare Tale

bloke

Gene and Melissa Patrick used his mom’s RCI points to stay at a Wyndham Resort. He was told he had to attend a member update or he would be charged $77 for a gift. He should have stopped right there, but like so many of our readers, he continued on.

We will call the sales agent Tina Timeshare as the sales agent in the video is like so many others we have reported on. As we always say, we know there are those trying to work fairly and honestly in timeshare, but the proportion of bad apples seems to be higher than even the proverbial used car salesman. Watch the video, but give it a chance. It seems boring in the beginning but the plot becomes more interesting as it thickens. For now, we will just itemize the allegations mentioned.

#1 A timeshare is tax deductible

This is a gray area, so we will defer to RedWeek and TimeSharing Today. Tax laws change, so a date would have been helpful. Apparently, in Mr. Patrick’s case, his timeshare was not tax deductible.

https://www.redweek.com/resources/articles/timeshare-tax-deductions

#2 Jim Cramer of Mad Money said Wyndham is a good investment.

Yes, Jim Cramer has been known to tout timeshare stocks, but that is not the same as saying buying a timeshare is a good idea. Mr. Patrick learned that the television clip he was shown was about Wyndham stock. Fifteen insiders made over $600,000 million on the Apollo buyout of Diamond, but that doesn’t mean buying the timeshare is a good idea. Mr. Patrick feels timeshare stock investors make money at the expense of so many who are duped into buying a timeshare.

One of our readers reported that he was shown a clip of the Ellen DeGeneres show at his Mystic Dunes presentation and told Ellen bought “hundreds of thousands” of Diamond points. Inside Timeshare is following up with Ellen on that one.

This is a good time to slip in the article I wrote for Jim Cramer’s investment news service, TheStreet, about timeshare contracts. At least Cramer allows opposing views.

https://www.thestreet.com/story/13653117/1/the-timeshare-industry-has-improved-its-reputation-but-still-faces-scrutiny.html

Tina advised Mr. Patrick that he had to promise not to sell the membership to someone for a higher price than what he had to pay. It was at this point Mr. Patrick began to lose track of the lies. “The pace of the deceit was so fast I could not keep up,” he lamented.

#3 Wyndham has a buy-back program

Mr. Patrick said his job had just been cut to 32 hours from 40 and he was unsure about his employment stability. “Not to worry Mr. Patrick! Wyndham has a buy-back program,” Tina assured him.

#4 The 90 minutes presentation was heading into its eighth hour

My favorite is #5

#5 God wants you to buy a Wyndham timeshare! He wants you to enjoy life.

Mr. Patrick might have been confused at this point because Tina probably meant “God wants me to enjoy life.”

#6 Your credit is Golden!!!

Melissa raises an eyebrow. “Our credit is golden?  Our credit score is less than 650. Our credit is not golden.” Mr. Patrick might have been confused here as well, because 650 is no problem whatsoever for a timeshare purchase so in that sense, his credit was golden, at least for the sales agent.

#7 is a sin of omission. Maintenance fees go up.

It wasn’t until the eighth or ninth hours, with pens in hand, were the Patricks told about maintenance fees and at that point they were about to collapse from exhaustion it seemed. The kids were getting a little tired too.

the end

That’s the end of our article, but we don’t know the end of the story. We do know that after Mr. Patrick lost his job he learned the hard way Wyndham did not have a buy-back program.

Which side are you on?

Like timeshare sales agent Chuck used to tell us on our timeshare Facebook, we’re all irresponsible suckers and should have known better. Lawmakers, timeshare developers and some Attorneys General seem to be on Chuck’s side.

ARDA says nine million own timeshares and 83% are happy with them. That leaves 1,530,000 not happy with most complaining about being sold by deceit, concealment, violation of trust and bait and switch. I’m on the side that thinks timeshare needs greater disclosure.

Diamond Resorts agrees too as they have launched a CLARITY™ program that, if followed, and that’s a big if, does provide accurate statements about their program. Inside Timeshare has heard stories reporting when CLARITY™ has worked and when it hasn’t.

The consumer is not off the hook here. I don’t blame the buyer for not reading word for word an 81 page contract, but the CLARITY™ forms ARE easy to read and are written in English rather than legalese. Items in bold are in bold on the form. I would have bolded what I have underlined. There are 20 items to be initialed on the legal size single sheet including:

I have reviewed the chart of Maintenance Fees for past years. I understand annual increases are normal.

The purchase of additional points will not decrease my maintenance fees.

Diamond does not offer a buy-back program and makes no representation regarding tax deductions, refinancing opportunities, or that there will be a secondary market for the sale of Points. Points do not typically appreciate in value.

I many not engage in any commercial rental activity to rent out Points for cash through online or print advertising to the general public and understand that my membership may be suspended or terminated if I do.

My membership is perpetual and may transfer by gift, or intestate succession upon my death. However, the transferee is not obligated to accept the transfer.

Redeeming points for reimbursement of travel services does not provide the best monetary value for my Points and is typically not lower in cost than spending cash for the same arrangements.

Non-Platinum Loyalty members cannot redeem Points for Maintenance Fees. Only Platinum Loyalty members may use Points to pay part of their annual Maintenance Fees, but that is not the highest and best use of Points. There is a $100 transaction fee and the redemption value per Point is currently $0.04 per Point and a maximum of 50,000 points can be redeemed.  

That about covers what Inside Timeshare has heard from readers asking Inside Timeshare for assistance with their Diamond complaints. I fell for two of the above.

So the moral of this story is not “Don’t buy a Timeshare” but “Timeshare Buyer Beware” and talk to a member of the Licensed Timeshare Resale Broker Association before buying any timeshare to compare the cost of buying resale or from the developer and the benefits or lack of benefits for doing so. Some may specialize in one resort or another like David Cortese of Magical Realty who specializes in Marriott Vacation Club, or Judi Kozlowski of RE/MAX who likes Hilton Grand Vacations, feeling Hilton has the most consumer friendly secondary market.

Contact Inside Timeshare or our member sponsored Diamond Advocacy Facebook to join the discussion.

We seek to provide Diamond Resort members a way to proactively address membership concerns; to advocate for timeshare reform; to obtain greater disclosure from the company; to advocate for a viable secondary market; and to educate prospective buyers.

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

There we have it, another week over and time to enjoy the weekend, breakout the BBQ’s, open a few tinnies or some vino and as our Aussie cousins say “Stick another shrimp on the barbie”!

Have a great weekend and as we always say before engaging with any company that either contacts you or you contact with anything to do with timeshare, it pays to do your homework!

stop press 1

Just as we were getting ready to hit the publish button this latest news has just come across The Great Lake from Irene Allen.

Lawsuit: Diamond Resorts ‘Harasses’ Timeshare Owners

 

https://www.classaction.org/news/lawsuit-diamond-resorts-harasses-timeshare-owners

It tells of a huge class action filed on 10 May 2017, so it looks like Diamond are being hit on both side of the lake!

 

weekend02

 

letter from america

Friday’s Letter From America

It’s that time again, another Friday Letter From America, this particular article has been submitted by Dr. Jeffrey Taylor, it really does shed some light on the Diamond Clarity Programme.

An Almost Nightmare on Timeshare Street

A Diamond CLARITY™ Experience

Shaking hands

By Dr. Jeffrey Taylor

Introduction Irene Parker

June 2, 2017

First the good news: CLARITY™ worked! Diamond’s CLARITY™ program was launched after Arizona Attorney General Mark Brnovich issued an “Assurance of Discontinuance” having received hundreds of complaints filed by Diamond members who either lived in Arizona or purchased in Arizona.

Inside Timeshare previously reported on an instance in Sedona Arizona when a few sales agents must not have gotten the memo about CLARITY™. Diamond did reach out to those members and resolved the dispute.

Today we are grateful to report an example of how CLARITY™ is supposed to work and did work. Unfortunately, the Taylors previously purchased two 50,000 vacation point packages they allege were sold by similar deceptive tactics spending approximately $150,000 per package. The Taylors hope Diamond will help them resolve the prior purchases applying the same principles of accountability, transparency and RESPECT for the customer.

Inside Timeshare is grateful to Jeffrey and Debra Taylor for coming forward to explain why timeshare is an industry in need of reform. Diamond Resorts is certainly not the only timeshare company under scrutiny. The Taylor’s story is long, but tangled webs often are.

Today’s timeshare story comes from Diamond’s Virginia sales center. Inside Timeshare has received several additional complaints from the same Virginia sales center, including the most recent report written by Marjorie Menacker.

http://insidetimeshare.com/another-nightmare-timeshare-street-client-experience-diamond/

Timeshare Buyers Beware – A Lesson

By Jeffrey Taylor, PhD

My wife Debra and I were original Sunterra owners. Convinced we had to become Diamond points owners after Diamond acquired Sunterra, we gave up our deeded weeks and purchased enough points to become Platinum loyalty level members. We had been having problems with availability and were assured becoming a part of the official Diamond program would resolve the issue. However, after upgrading to Platinum in 2013, we still had problems with availability.

Twice we were convinced we had to purchase additional points and did purchase two 50,000 point packages. We would have purchased a third based on tall tales, but thanks to CLARITY™, the deception was stopped. CLARITY™ kept us from making a third mistake. We are sharing our story hoping others will come forward as Diamond needs to know about the harm being done to families like ours.

How CLARITY™ worked

Our meeting took place at a Diamond Sales Center in Williamsburg, Virginia in 2017. We were having serious issues with Diamond’s program and wanted to meet with a vacation counselor. After signing a contract to buy more points, we met with a Diamond Quality Assurance person named Rick who went over the new CLARITY™ forms with us. In doing so, we realized we almost succumbed to what we feel is deception a third time. Rick asked us to write a letter.

Rick:

Thank you again for the professional way in which you handled the horrible misrepresentation that happened during our owners update yesterday. My wife and I were so upset that it was difficult to put our thoughts together in your office. We have never had a business transaction where things were not only misrepresented, but outright lies were told.

My family has been a member of Diamond for almost 27 years. We have 150,000 points. Our sole purpose in coming to Williamsburg was to have an owners update. We were specifically interested in the ways that we might sell Diamond points and see if there were ways to offset the cost of maintenance costs. We made it clear we had no interest in purchasing new points.

We met with Geoffrey Cash for over six hours. After going over a number of routine items, Geoff got to the point of explaining some “New” programs that were instituted at Diamond on Apollo’s recommendation. He made it clear that Apollo was advising Diamond,  making sweeping changes to improve Diamond’s customer satisfaction. He then started a three hour conversation on a “new” program of maintenance fee offsets. The story we got was that Apollo thought that the value of Diamond points was undervalued, but that now Platinum members could use a 30 cent per point value to pay maintenance fees. Geoff did indicate that the going rate for fees was at 4 cents a point, but that platinum members had this new program. We were told that we could use ANY amount of unused points in November and a check would be cut to pay the maintenance fees. I took Geoff’s calculator and multiplied 100,000 by 0.3 and said, “So if we had 100,000 points left over in November, we could get a $30,000 check to pay fees with”. He said this was correct.

But in being totally honest with us, Geoff indicated there was a “catch”. Apollo could only do this for Platinum members who had a minimum of 100,000 points, but 100,000 of our 150,000 points were “deeded” and another 50,000 were in the Diamond trust. To qualify for this program we would need a total of 100,000 “trust” points. Geoff flatly stated that to be a “full platinum benefits member” we need to purchase 50,000 additional “trust” points in order to benefit from the maintenance fee program. We were shown two pieces of paper with 10 and 20 year projections of the maintenance fee cost now as opposed to the reduced costs over the same time periods if we purchased the additional points. The reduction amounted to about half the fee costs, from $380,000 for 10 years to about $180,000 in the new program.

We rejected a quote for 50,000 points. They came back with a 25,000 point quote. Finally we were presented a quote for 10,000 points and told our “equity” would cover the missing 40,000 points. Geoff went into a detailed written analysis of how the total cost of the 10,000 points over 10 years would be paid for by the maintenance points offset savings. The only reason we purchased the 10,000 new points was to gain access to the maintenance fee offset. We have zero need to purchase additional vacation points. Geoff acknowledged that he understood.

The paperwork that Geoff used to explain and justify getting these new points we found out later were shredded. Why were the sales related handwritten documents destroyed rather than presented to the buyer? We have no proof of what we were told. Geoff told us twice that we should not be concerned if the “finance guy” did not know about the deals we were offered. He said finance people were several months “behind” the sales promotions.

Thankfully Rick, you caught this and prevented us from making a big mistake based on serious misrepresentations.

It appears most of the information we received is seriously incorrect. Debra called the Platinum number this afternoon and tried to verify several key points. Almost everything was not in agreement with what Geoff told us, and the written guides Geoff gave us contradict what he verbally told us. At best this is unprofessional, at worst it’s fraud.

Thank you again for the professional treatment that you demonstrated with us.

Sincerely

Dr. Jeffrey L. Taylor and Debra C, Taylor

Why we purchased two 50,000 point packages for $150,000 each

truth

Thanks to CLARITY™ the 2017 upsell was cancelled, but the 50,000 points we purchased in Williamsburg in 2016 and 50,000 points purchased in Hawaii in 2014 at Ka’anapali were sold employing the same level of outlandish claims.  

The Hawaii Up-Sell

In 2013 we were Platinum members. Availability had not improved. We went to Hawaii in 2014. Here we were told that booking priority came from the DRI collection. We were told the Hawaii collection was the DRI flagship “Premier” collection and being in this collection would solve all our availability problems. We had to purchase another 50,000 points in order to transfer our 50,000 US collection points into the Hawaii collection.

This was the first time we heard about the 30 cent per point maintenance fee reimbursement program (we know now does not exist), said to be part of the new Diamond level above Platinum.

We were also told that “renting” the weeks around Christmas in Hawaii would generate more than enough money to cover the yearly maintenance fees and was routinely done by members. When we expressed concern over how complicated this seemed, the salesman said he could help advertise the rental.

 

The CLARITY™ forms were not available at this time but the policies are the same: I may not engage in any commercial rental activities to rent our Points for cash through online or print advertising to the general public and understand that my membership may be suspended or terminated if I do.

Now we owned a total of 100,000 points but availability did not improve.

The Williamsburg Virginia Up-Sell

We went to Williamsburg for our anniversary in March of 2016 to get some answers. When we arrived we were immediately singled out as “premier double platinum members” and were assigned to their best representative, Brandi.

They explained that Brandi was based at the Polo Club in Las Vegas and was visiting the Williamsburg center to train everyone on the latest DRI offerings. She claimed to have helped develop many of Diamond’s policies.

Brandi said she would get to the root of our problems. We had Brandi go on her computer and log into our account to try and make reservations. Sure enough, there was no availability. She seemed perplexed. In checking our account Brandi was “horrified” to find that there was key information missing from our account that would help in booking resorts. After about an hour she said she knew what the problems were and, unfortunately, there was not an easy fix.

Brandi said the Hawaii Collection points only gave us booking priority in Hawaii. She said our current status in the Hawaii collections was essentially useless in booking US collection resorts. No one in Hawaii told us this fact. In addition, there was still an issue with the original grandfathered points that were not “real” DRI points. Our understanding was that the Williamsburg and Hawaii collection purchases resolved these problems and gave us priority in booking at all DRI resorts. She stated absolutely not. This was devastating news. We had points that were worthless unless we went to Hawaii every year or “rented” points.

Irina Allen has had her 139,000 Diamond points suspended, accused of renting her points. She owns Hawaii points and disputes Brandi’s verdict. “The Taylors could have used Hawaii points to book on the US Mainland as they would only lose the 13 month reservation priority. They could make reservations in any of the US Collection resorts up to 10 months in advance.”

“But gosh,” said Brandi, “You seem like such nice people.” Brandi said she was going to see if she could help because we were so upset. The answer from management was to buy another 50,000 points in the US collection so we could convert the other 100,000 points to the US collection. DRI was going to allow us to do this with only a 50,000 point purchase as opposed to 100,000 points if we did the deal that day. Our choice was leaving with 100,000 useless points or taking the 50,000 point purchase for 150,000 US points total.

We made several points clear to Brandi. We could not afford the maintenance fees over time on 150,000 points and we could not use that many points in a year.

I asked if DRI bought back points or if we could sell them. Brandi indicated that DRI did indeed buy points back. She said the market value of DRI points was $10 a point at that time and going to $12 or more in the future. Since they were selling us the 50,000 points at a huge discount of $3 a point, we could easily sell them on the open market for $3. However, if we were going to sell that low, DRI would most likely buy the points back at the price we paid for them. To prevent people from buying and dumping points, we would need to wait two years before DRI would buy them back or we could sell them.

Note from CLARITY™: Diamond does not offer a buyback program and makes no representation regarding tax deductions, refinancing, or that there will be a secondary market for the sale of Points. Points do not typically appreciate in value.

As far as too many points, Brandi told us about points being just like money and we could get rental cars, cruises, hotels, and travel tours for 30 cents a point in 2017. The same amount per point would be true for maintenance fees. When we pointed out that we could not find this on DRI’s web page, Brandi said the 30 cent deal would be in the 2017 handbook. She knew all of this because she was part of the Polo Club management team who were developing the policies.

Note from CLARITY™ form: Redeeming Points for reimbursement of travel services does not provide the best monetary value for my Points and is typically no lower in cost than spending cash for the same arrangements.

That brings us up to February 2017 in Williamsburg seeking answers because very little that Brandi told us came to pass. Geoff spun six hours of dialog, again telling us our points were not “real” platinum points and we need to buy more. That triggered the investigation and the complaint we sent Rick.

new beginnings

All Diamond members hope CLARITY™ does indeed mark a new beginning. If what the Taylors said they were told is true, it meets the FBI definition of White Collar Crime which is “deceit, concealment, violation of trust and bait and switch.”

Inside Timeshare has been receiving a number of complaints from Diamond members with very similar, and in some cases, identical complaints from highly educated professional people. It’s getting harder and harder to accept that the Taylors and all those featured in our articles are making up allegations.

Dr. Jeffrey Taylor worked 30 years for Perkin Elmer in sales and sales training.   Debra worked as a Special Education teacher until their special needs grandchildren required their support.

The Taylors found Inside Timeshare by finding our member sponsored Diamond Advocacy Group launched February 2017, now up to 300 Facebook members.

We seek to provide Diamond Resort members a way to proactively address membership concerns; to advocate for timeshare reform; to obtain greater disclosure from the company; to advocate for a viable secondary market; and to educate prospective buyers.

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

Here are other Inside Timeshare “Nightmare on Timeshare Street” articles

By Neina Orrillo

http://insidetimeshare.com/diamond-in-the-news-again/

By David Franks

http://insidetimeshare.com/fridays-letter-america-5/

Barclaycard and Member stories

http://insidetimeshare.com/timeshare-barlcaycard-us/

By Marjorie Menacker

http://insidetimeshare.com/another-nightmare-timeshare-street-client-experience-diamond/

By Eron Grant

http://insidetimeshare.com/fridays-letter-america-4/

By Nancy Callahan

http://insidetimeshare.com/another-nightmare-timeshare-street/

A Filipino Family

http://insidetimeshare.com/anatomy-timeshare-foreclosure/

By Laurie Sabbagh

http://insidetimeshare.com/friday-review-news-across-ocean/

A Military Family

http://insidetimeshare.com/consumer-protection-week-usa/

The Hurleys

http://insidetimeshare.com/timeshare-advocacy/

Irina Allen

http://insidetimeshare.com/timeshare-news-across-atlantic/

Kathie Old

http://insidetimeshare.com/call-change-us-timeshare-industry/

Wyndham Trish Williams $20 Million Whistleblower Jury Award

http://insidetimeshare.com/wyndham-whistleblower-update/

The Peasant of Venice and the Queen of Versailles

http://insidetimeshare.com/peasant-venice-queen-versailles/

Sylvia Saldana

http://insidetimeshare.com/irene-parker-write-barclay-card-usa/

Thanks to Dr Jeffrey Taylor for his excellent views also to Irene who is coordinating the articles from the other side of the great lake.  So all that remains is to wish you all a very good weekend.

friday dog

us-eu-coop

Clarity: The Quality of Being Coherent and Intelligible.

Yesterday Inside Timeshare highlighted the plight of owners at Los Claveles resort in Tenerife, our US readers have a similar problem with developers attempting to take over resorts. Their problem is the transfer of deeded weeks to points, rather than the heavy handed actions of the Ona Group. We have also seen this in Europe, where the likes of MacDonald Resorts with the tacit approval of the owners committees association TATOC, are attempting to change all fixed week owners to their ridiculous points system. A system which only allows a stay under one condition “SUBJECT TO AVAILABILITY”.

Over the past few months Irene Parker Inside Timeshares partner from across The Great Lake, has been highlighting the problems that Diamond owners are having. One of the main themes has been the downright lies sales agents have been using to sell more and more points to people who obviously cannot afford it. The use of the Diamond BarclayCard is one tactic they have used, with promises that it reduces maintenance fees. Irene has in previous articles shown how this has devastated people’s lives.

Diamond sometime ago rolled out “Clarity”, supposedly to make everything transparent, today’s article from Irene poses the following question:

Is the Diamond Resorts Clarity Program Real?

facts

By Irene Parker

May 23, 2017

My husband and I stayed over two weeks at Diamond Resorts Scottsdale Links and Los Abrigados this past month. Anxious to hear more about Diamond’s Clarity Program, I asked if I could speak with a sales agent to learn more. Unfortunately, my requests at the concierge desk and emails went unheeded. Disappointed, I approached several existing members asking them for their feedback. I had hoped to hear positive stories.

Two of the families I spoke with did not want to go on record, but Faye and Mike Hanrahan from New Jersey shared their experience with me. I probably picked the wrong couple because they are former Monarch owners. Diamond has pursued former Monarch owners to give up their deeded timeshare week in exchange for non-deeded “right-to-use” points. In addition to Monarch, ILX, Intrawest and now Gold Key face the same battle in an attempt to hold onto their deeds.

Here’s what happened at Los Abrigados in Sedona according to Faye and Mike:

We had our sit down. We were told we have no way out of Monarch unless we spend approximately $10,000 for the equivalent of 6,000 Diamond vacation points with either a $1,400 maintenance fee or, if we signed a contract that same day, an $871maintenance fee. After we refused the first sales agent, we were introduced to an agent who said he was an original Monarch owner, but now worked for Apollo, although he had on a Diamond name tag. It was because he was with Apollo he could offer a half price on maintenance fee offer if we signed before leaving the room. Already familiar with timeshare, we knew there is no such opportunity for one owner to have half off the company’s maintenance fee. They offered to help by opening a Diamond Barclaycard for $3,995 put up by Barclays. The deal was to pay $39.95 month for 23 months to buy a “Club Combination for Life” program. After 23 months we were told we could use the $4,000 to buy into Diamond or Barclays will “zero out the debt” having paid a total of $918.85 at the end of 23 months. We of course could continue to use the credit card. Do you have any suggestions for getting rid of this timeshare?

Pressure to give up a deed is a frequent complaint. Once you give up your deed, the Diamond owner is no longer allowed to rent using a third party rental agency or website.

But back to Clarity, which is about accountability, transparency and respect for the customer. In the spirit of fair and balanced reporting, here are some excerpts about Clarity provided by Maya Pogoda, PR spokesperson for Diamond resorts.

Before we begin, I should mention that Inside Timeshare has been hearing from Diamond members on almost a daily basis. The majority of complaints received have been about upsells to existing members, even Platinum members, as per the individuals who reported to us, for the following reasons:

The only way to sell Diamond points is to buy more points because only Platinum members can sell their points.

The only way your heirs don’t have to keep up with maintenance fees is to upgrade to the next loyalty level. One family bought more points for this reason only to be told by the next agent at a subsequent presentation this benefit is already available, as she pointed out in a guidebook.

You should not have bought US Collection points because you won’t be able to book Hawaii (if in Hawaii) or you should not have bought Hawaii points because Hawaii maintenance fees are going to increase dramatically (if on the US mainland).

The only way to be eligible for a $.30 maintenance fee reduction is to upgrade to the next loyalty level. Only Platinum members can use points to pay maintenance fees at $.04 per point.

You need to buy more points because you can’t do anything with the small number of points you purchased.

Member stories are listed in our Barclaycard article

Timeshare and Barlcaycard in the US

Here is Diamond’s perspective on Clarity from PR spokesperson, Maya Pogoda. Her comments are from discussions we had in January and were previously reported.

“We have been piloting the various elements of the Diamond Clarity program for some time,” Pogoda explained. “Now that we gained the confidence that each of these pieces were effective, we were able to roll out this cohesive, national program that seeks to enhance the overall customer experience when purchasing and holding a vacation membership. Diamond Clarity will rewrite industry best practices by increasing transparency for the consumer and accountability for our team members.”

Pogoda noted that 70% of its sales are to existing members, however, Diamond Clarity “will improve the overall customer experience by increasing transparency for the consumer and accountability for our team members. At Diamond Resorts, we are always working to provide our members with the best possible vacation experiences. This focus on hospitality and creating lasting experiences has made Diamond Resorts an industry leader. We have always believed that customer satisfaction creates loyalty. So while the definition of customer loyalty has not changed, our commitment to finding new ways to drive customer satisfaction to create loyalty evolves constantly. Diamond Clarity is evidence of that.”

Creating a Consumer Advocacy Channel within the company’s corporate headquarters, to quickly address any issues or concerns members may have. This new platform will allow Diamond Resorts to maintain the highest standards of service in the industry.

https://www.loyalty360.org/content-gallery/daily-news/diamond-resorts-international-raises-the-bar-on-cu

No one doubts there are are Diamond members who are sold honestly and fairly, but over 250 Diamond member families have bonded together through our advocacy Facebook to support one another as we fight off endless up-sell attempts that have driven families further and further into debt.

To date our Advocacy group has received and assisted the following complaints.

Our Advocacy Efforts Statistics Update

75 Inquiries for assistance

55 Formal interventions complaints filed or assisted with

Reasons for 75 complaints as provided by the complainants

34 Sold by deception and bait and switch

09 Barclaycard upsell/predatory lending

02 30 cents to convert to MF relief (non-existent program)

06 Switch back from HI to US Collection or vice versa

06 Maintenance fees increases

02 Survivor benefit program (non-existent as already available)  

08 Bought more points told it was the only way to exit the timeshare

08 Lack of Availability

We seek to provide Diamond Resort members a way to proactively address membership concerns; to advocate for timeshare reform; to obtain greater disclosure from the company; to

advocate for a viable secondary market; and to educate prospective buyers.

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

According to Maya,

Diamond Clarity is not limited to just one state, it’s a national program that includes four new operational initiatives. One of these initiatives is recording quality assurance sessions subject to consent from purchasers, to review compliance with all policies and procedures, and to augment and enhance the company’s sales and quality assurance training.  The company has invested in technology to ensure that these recordings can be archived and searchable. Recording sales presentations would not meet these objective and thus are not currently part of the Diamond Clarity Program.”

The recording of the QA session is the biggest sore point Diamond members have with Clarity. Many of our complaints include the sales agent advising the buyer not to say anything about an exciting new program because “The program is not public yet so I could lose my job if you tell anyone.” Arizona allows the recording of the sales session but few buyers will go to the trouble.

Marjorie Menacker’s experience is an example of this. To date, Diamond has denied her release.

http://insidetimeshare.com/another-nightmare-timeshare-street-client-experience-diamond

We end with some member advocate comments as to why these upsold members are wary.

inspired advocates

Irene Allen

Jan 28 (5 days ago)   

 http://insidetimeshare.com/timeshare-news-across-atlantic/

This new program by DRI is a very predictable step after the Arizona Attorney General’s action. If Clarity is about transparency, why does Maya not once reveal the only reason the company issued the program is because Diamond is essentially under state supervision in Arizona after the issuance of an “Assurance of Discontinuance” after over 400 complaints received claiming Diamond violated Arizona’s Consumer Fraud Act.

 DRI is obligated to demonstrate cooperation and compliance to new disclosure requirements by the AZ AG, but the company will do nothing for existing owners because they purchased contracts during the “Murky Stage”

“Clarity” does not have any provision of fixing the existing and growing problems which are flooding the courtrooms all over the world where DRI operates ….

  1. Regarding recording the QA sessions by DRI, this should be only offered if attendees, who are, according to “Clarity“, 70% existing owners, be allowed to do the same in order to establish a level playing field. Otherwise it is a trap participating owners will end up in, because it will give DRI additional defense tool in the courtroom.
  1. Regarding creating a Consumer Advocacy Channel. This Channel should have consumer rights attorneys and secret observers not employed by DRI in order to eliminate conflict of  interest.
  1. Regarding increase training to frontline personal. The frontline personnel had superb national training during the “Murky Stage”. How else can you explain the fact so many owners all over the world had exactly the same upsell by deceit and “bait and switch” during sales presentations? Many of our 250 Facebook member families claim sales representatives all over the world presented exactly the same falsified and misleading comments in order to entice owners to buy additional points. The name of the national sales training program should be: “101 ways how to deceive owners during sales presentation process and increase the volume of sales.”

Second member comment

I realize we are all skeptical about “promises” made by DRI, but this program has the potential of making a positive impact on our relationship with DRI.

Third member, a Diamond member and an attorney

  • Is the idea that none of these rules were previously in place?  It appears to me these are designed as Diamond CYA’s going forward, “we have a recording” or “there as an observer” or “contact the consumer advocacy channel within __ days”.  For Diamond to say the allegations we all experience did not happen.  

What does this accomplish for the victims of the bad business practices from the past?

  • Recording Quality Assurance sessions, subject to consent from purchasers, to review compliance with all policies and procedures, and to augment and enhance the company’s sales and quality assurance training.
  • Creating a Consumer Advocacy Channel within the company’s corporate headquarters, to quickly address any issues or concerns members may have.  This new platform will allow Diamond Resorts to maintain the highest standards of service in the industry.
  • Increased training of frontline personnel.  All sales and marketing personnel will take part in quarterly training exercises to reinforce their awareness, understanding, and compliance with all sales and marketing rules, principles, and practices.
  • Regularly placing “Consumer Engagement Observers” at sales presentations to continuously provide the sales organization with feedback necessary to achieve constant improvement.  
  • I would suggest these are great improvements to the training and consumer friendly positions Diamond should have had all along.  It does nothing to help people who have already suffered with no recourse from Diamond.
  • If their product was so great, Clarity would be evident within the first 6-12 months of an owner’s experience with the company.  It would be clear that this is “everything they said and represented” or it is “nothing that I was promised” and the consumer would still have options to exit, sell or rescind on some compromised plan. The longer you wait the less you retain.

I am not impressed.

Fourth comment anonymous due to Litigation

Enforcement of DRI “PROMISE” is difficult, unlikely, and merely a smoke screen to generate a false sense of security regarding oversight. It is another set of unenforced regulatory promises which incidentally spawned the crisis currently engulfing Diamond owners. The paltry AG financial agreement and appurtenant agreements simply demonstrate that the AZ AG is taking steps to protect itself from accusations of inaction.

Their behavior is reminiscent of the legal machinations demonstrated by ADRE and California Department of Real Estate. Complainants with ADRE regarding fraudulent practices at Diamond are told that such a complaint is an employee/employer dispute.

When filing complaints with RE regulatory agencies, it must be understood that determinations that deflect the fraud accusations are made to avoid costly investigations. This embraces the policy of waiting for some catastrophic event to prompt unavoidable enforcement action. It does not eliminate the need to continue to create a public record of these complaints, and legitimate demands to be made whole from recovery funds. Misleading determinations by these agencies should be challenged in order to demonstrate the lack of responsible enforcement pertaining to regulatory obligations.

Fifth anonymous member

If we only hear one side of the story or information how are we truly being informed? That is what happened with the hard sales only hearing their side. Our Advocacy members and Diamond need to hear and listen to both sides instead of the constant media spin.

You can share.

Sixth anonymous member

I’m afraid I don’t have much hope that this “Diamond Promise” will change much. I purchased a Sampler package in Sedona in 2012 and annual points the next year in Las Vegas. As best as I can recall, the procedures enumerated in the “new” Diamond Promise existed then, and still I was misled on some important issues.

The Diamond Clarity program has no mechanism which commits the vacation counselors, sales managers, and quality assurance officers to the Promise. In other words, there is no effective enforcement mechanism. Such a mechanism must impose a cost on the seller when the promise is violated.

The economic analysis of warranties has shown that a product sold with a warranty creates an incentive for companies to improve product quality. Reductions in the level of quality – like the misleading sales information in the case of timeshares – leads to higher warranty costs and thereby penalizes such behavior. We have good reasons to believe that in the absence of warranties high quality products get driven out of the market, while low quality products are driven out when warranties are used.

This new program depends on the trust in and good will from Diamond managers. But this is the same group that is incentivized to increase sales and revenue for the organization.

Seventh anonymous member

Promises are only as good as the party providing the assurances. I too see no real means of enforcement, and if anything this could provide an excuse for relaxed oversight by regulators.

I have been pressing the AZ Dept. of RE for 3 years to take enforcement action against DRI’s brokers.  It has been clearly demonstrated that they are negligent in discharging their responsibilities pursuant to RE statute.

I would recommend that owners look at filing a claim with ADRE as complaints are mounting regarding DRI behaviors.

Eighth anonymous member due to litigation

Clarity is definitely a meaningless program – except to bolster Diamond’s position in court.  I can hear it now – our QA monitored sessions prove no widespread fraudulent practices.  

Agents will know when they are being monitored or recorded so they will be on their best behavior.

Shacking hands

Will there ever be a day when we can all get along by communicating and responding to voices of the concerned?

Once again thanks to Irene and all who contribute from the other side of The Great Lake, one thing is for certain, owners on both sides are starting to see that by joining together they can make a difference.

To those owners at Los Claveles, you do have support, we only need to bring it together.

getting together

If you have any comments on any article published or would like to contribute, Inside Timeshare welcomes you.

 

nightmare

Another Nightmare on Timeshare Street: Client Experience with Diamond.

Today we publish the story of Marjorie Menacker, another Diamond member who contacted Irene Parker for help. This is her story of how they feel about Diamond, it would seem that “Clarity” is out of the window. We let you decide for yourselves.

Will Diamond Resorts ever listen?

Marj

By Marjorie Menacker

May 15, 2017

We, Elle and I, are two more Diamond members asking the company to own up to misrepresentations and deception in Diamond’s quest to upsell current Diamond members. We know we were victims of a “bait and switch”. We were told buying more points would eliminate maintenance fees that had become burdensome due to my brain injury. Our 14 year old son Sam, diagnosed with FSGS, an autoimmune kidney disease in 2015, has added to our burden. Sam has required hospitalization.

I contacted Diamond Consumer Advocacy before seeking legal assistance or filing complaints with the Arizona, Virginia and Nevada Attorneys General, the FBI, the FTC and ARDA for violating ARDA’s Code of Ethics. Diamond’s Consumer Advocacy Department should be named Diamond’s Advocacy Department because their job is to advocate for Diamond, as evidenced by the company’s response, refusing to acknowledge a Diamond sales agent would not be truthful.

In Arizona, Diamond’s new Clarity program does not allow sales agents to deviate from written sales materials. The oral representation clause still exists in the Arizona contract, but the Arizona Attorney General’sAssurance of Discontinuance” forbids sales agents from deviating from the sales agent’s official script. I was hoping Diamond Resorts would honor Clarity’s principles of fair and honest business practices even though we purchased in Virginia. Clarity is about Accountability, Transparency and RESPECT for the customer!

Diamond often offers to “take back” points, for a fee, ignoring the deceit, concealment, violation of trust and “bait and switch” so many from our Advocacy group have complained about, as defined by the FBI as White Collar Crime. Diamond even charges a fee to surrender points while requiring the member to still make any remaining credit card payments. This keeps the “hamster wheel” running as Diamond will merely take back our points and resell them for full value.

We are telling the truth. Since Diamond will not believe us, these Diamond sales agents must be telling unsuspecting consumers day in and day out, any story they can come up with to sell points.

Here’s what happened

Elle and I purchased a week at the Powhatan Virginia resort in the 1980s. Our deeded Powhatan week was given up in July 2007 while staying at Sedona Arizona when we purchased 10,000 points for $21,585. We purchased an additional 6000 points December 26, 2015 for $23,210 having been told about an exciting one day promotion if we purchased that day. The sales agents said we would not have to pay maintenance fees for 2016. Our contract lists a William Humphries as our sales agent, although we spoke to Brian and his supervisor Jeff at Diamond’s Greensprings Plantation Resort.

We were encouraged to open two Diamond Barclaycards to finance the purchase. A total of $23,170 was charged to two Barclaycards. The finance rate is 25.74%.

I suffered a concussion November 9 2015, about six weeks before our sales presentation, after being hit by a construction truck while I was walking in downtown Richmond.  At the time of our presentation, we had not yet realized the full extent of my injuries. Over the course of first quarter 2016 I realized I needed concussion and rehab specialists and quite a bit of therapy to initiate and sustain a slow recovery. I am still being treated for the brain injury and physical injuries from the accident.

The Powhotan sales presentation was very high pressure. We repeatedly stated that we could not afford anything that would require a loan, and did not like the difficulty we encountered finding availability. Maintenance fees were rising faster than we expected.

Brian repeatedly assured us that if we took advantage of the promotion offered that day, we would not have to worry about any maintenance fees after the 2016 calendar year. He said this promotion would have been offered to us had we participated in dinner meeting offers over the previous year. I’ve learned almost all Diamond presentations begin with, “You should have been invited to a dinner meeting.” Out of our sight, Brian obtained special permission to extend the offer only for the day (12/26/2015). Jeff confirmed what Brian offered.

We were told that we would no longer have to pay for annual maintenance fees, having qualified to participate in the special program that was not publicly available.  Brian illustrated in chart form on paper how this program would save us money by trading in part of total points each year. He said the remaining points would actually get “treated as double points.”

We should have been suspicious when he would not let us keep a copy of the paperwork with the calculations he made or even let us hold it to view in a private conversation.  Brian brought Jeff in, and they recreated the chart and both reassured us it was all above board, though warned us not to mention the specifics to anyone when time to sign the contract.

We trusted that Diamond Resorts was a publicly traded company (at the time) with a good reputation, and our expectation was that we would be properly treated and not misled.  They both explained we would receive a phone call annually in December right after our maintenance fee bill arrived and would be guided to trade in the proper number of points to write off the entire maintenance fee each year.

This past December 2016, when the call never came, we reached out to the Quality Assurance Officer whose card we were given. She was unavailable so referred us to Susan Schnibbe who put us in touch with the salesmen around December 20, 2016.  Both Brian and Jeff denied ever telling us this type of program existed, but we were promised a call back the same day as to “what was possible.”

We were in fine shape with the 10,000 points we already owned in the US Collection, and were able to manage to pay the annual maintenance fees. At this time we must pay down a loan instead of planning our vacation.

We told Brian and Jeff about our son’s condition, the ongoing expense and that I was dealing with post-concussion syndrome.  We also have medical expenses resulting from our older daughter’s Medical College of Virginia Pediatric ER for a serious head and back injury from a fall.  Realizing we were duped, our trust of Diamond Resorts has been shattered.  We feel that we were taken advantage of, misled and lied to. We have struggled to provide for our children as well as maintain our good credit rating. This breech of ethics by Diamond Resorts representatives jeopardizes Diamond too.

We would have been happy with the valued level status we had prior to the December 2016 sales-pitch.

Irene at computer

Our Diamond Resorts member sponsored Advocacy Group has been overwhelmed assisting Diamond members who feel they were victimized by sales agents making promises that fall far afield from reality.

We seek to provide Diamond Resort members a way to proactively address membership concerns; to advocate for timeshare reform; to obtain greater disclosure from the company; to advocate for a viable secondary market; and to educate prospective buyers.

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

A Diamond representative said there was no misrepresentation.

Original letter sent to David Palmer January 7, 2017

At the time of our purchase, former Diamond CEO David Palmer had just made over $173 million on the Apollo buyout and over $26 million in executive compensation. That could be why he did not answer the letter we sent him.
7 January 2017

David F. Palmer, CEO

Diamond Resort International

10600 West Charleston Boulevard

Las Vegas, NV 89153-1260

Dear Mr. Palmer,

In December of 2015, we attended a very high pressure sales and “owner update” in Williamsburg at GreenSprings plantation sales office. The salesman, Brian and his manager Jeff were very demanding of our time even though we told them we had 3 middle-school-aged children waiting for us back at our condo. I had suffered from a serious concussion about 6 weeks earlier after being hit by a construction truck while I was walking in downtown Richmond.  We had not yet realized the full extent of my injuries at the time. I am still being treated for the brain injury and physical injuries from the accident well over a year later. We repeatedly stated that we could not afford anything that would require a loan and the growing maintenance fees. Brian assured us that if we took advantage of the promotion offered that day, we would not have to worry about any maintenance fees after the 2016 calendar year. We were told this promotion was something that would have been offered to us had we participated in dinner meeting offers over the previous year.  Brian obtained special permission, out of our sight, to extend the offer to us that day (12/26/2015), and that day only.

The bottom line is we were told that we would no longer have to pay for annual maintenance fees, having qualified to participate in the special program that was not publicly available.  Brian illustrated in chart form on a paper how this program would save us money by trading in part of our total points each year but the remaining points would actually get “treated as double points.”  We should have been suspicious when he would not let us keep a copy of the paperwork with the calculations he made or even let us hold it to view in a private conversation.  Brian brought Jeff in, and they recreated the chart and both assured us it was all above board, though warned us not to mention the specifics to anyone when time to sign the contract. They both explained we would receive a phone call (annually) in December right after our maintenance fee bill arrived, and we would be guided to trade in the proper number of points to write off the entire maintenance fees each year.  This December, when the call never came, we reached out to the Quality Assurance Officer whose card we were given.  She put us in touch with the salesmen around December 20, 2016.  Both denied ever telling us this type of program existed, but we were promised a call back the same day as to “what was possible.”   We have received no return calls.  As baby boomers, raised by parents from the depression era, we do not like to borrow money for anything. Both Brian and Jeff were told of our son’s condition, the ongoing expenses and that I was dealing with post-concussion syndrome.

With the enlightenment that we were duped into a loan and will also experience increasing annual fees, we feel that we are in severe debt and our trust of Diamond Resorts has been shattered.  We feel we were taken advantage of, misled and lied to, frankly. We have repeatedly asked for an avenue to appeal for a reversal and revoke the contract from last year. Actual ownership, it seems, is not an advantage, considering the expense we pay for the maintenance of these resorts.  We would like to return to the status prior to the December 2015 sales-pitch.

I do hope that you take our situation seriously, and, regardless of the internal consequences to the salespersons who so poorly and unethically represented Diamond Resorts, you and I begin an authentic dialogue about making this right.  My partner and I are quite willing to work this out efficiently and honestly, directly with your office or a representative to whom you would direct us.

Thank you for your time.  We look forward to hearing from you by traditional mail or email as how we may begin this dialogue.

Most Sincerely,

Marjorie S. Menacker

Inside Timeshare would like to thank Marjorie for giving us Her story so we could share it with you, this is important as it shows that you are not alone.

Inside Timeshare and the Facebook Advocacy page have been receiving many stories just like this, if you wish to share your experiences of these presentations you can contact Inside Timeshare or the Advocacy page.

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

 

letter from america

Friday’s Letter From America

It’s Friday again, this week’s “Friday Letter from America” is a little light hearted from our usual fare, it may just be that our roving reporter Irene is on holiday (sorry vacation for you across the pond).

Irene is staying at Los Abrigados, this is not to be confused with the “fake” law firm that we have been reporting about “Litigious Abogados”, or as one of our friends Naty, calls them “Avocados”.

Avocados
These are Avocados
abogados
These are Abogados

Well, on that subject, they have been very busy again, contacting owners in the UK with the wonderful news that their timeshare resort is in court at the end of this month. Not bad considering the client hasn’t even instigated any legal action or even Knew they had a claim!

This particular reader also had a very lucky escape, he felt that he could not have a claim against his timeshare resort as he purchased in England and not Spain. He then searched the web and found Inside Timeshare, with all the articles and warnings we have published about this “SCAM”, he contacted us for advise.

We confirmed that he could not make a claim in Spain as it did not come under Spanish law, he also purchased before 1999 and has never made any upgrades. It just makes you wonder how many have actually paid this lot, as the cases we have reported on are only the tip of the proverbial iceberg.

On the news about the demise of Harry Taylor and TATOC, another reader sent us this response:

“So it`s goodbye from them (Silverpoints) and goodbye from them/him, (the Harry Taylor dictatorship known as TATOC.) The other directors seizing the opportunity to do like Emily Collins and Christine Roberts and clamber into the lifeboats. Unfortunately the directorship indemnity insurance makes them all jointly and severally responsible if any illegal activities have taken place and because they did not insist on correct and acceptable company governance and transparency they must all now be very worried as to their positions re the responsibilities. They had to see that the company was being run in a professional manner. They were all made aware of this but chose to ignore the warnings”.

“It is understood that Harry Taylor will now be pursued through the courts personally for trying to bring another business into disrepute”.

“As predicted on here years ago and before this forum was taken over by its present admin. The house of cards that is timeshare is beginning to crumble because of its greed and shortsightedness in refusing to reform having persuaded the EU Commission to allow them to police themselves”.

So that really does say it all, one opinion shared by many. Now on with this Friday’s letter.

To Diamond CEO Michael Flaskey from Don and Irene

Please fix your Pool Table!

A Sedona Arizona Los Abrigados Resort Review by Irene Parker

pool
Could this be Irene?

Cinco de Mayo 2017

My husband Don and I are staying at Diamond’s Los Abrigados property in Sedona for two weeks. Having researched Diamond’s executive compensation, I learned that former CEO David Palmer earned $25 million in two years and former CEO Stephen Cloobeck was allowed 50 hours annual use on the most expensive aircraft in the Diamond fleet prior to the Apollo acquisition (for non-business purposes). I would think a little money could be allocated to fixing the pool table at your Spoke and Wheel tavern and eatery.

My husband and I have been shooting pool at Los Abrigados since 2008. Having met in a pool hall 35 years ago, pool is important to us. And it’s not just important to us. There are six to twelve pool enthusiasts who sadly told me they have been trying to convince Diamond to fix the pool table for two years.

Now a pool table may not sound that important to you Mr. Flaskey, but when you met your husband in a pool hall 35 years ago, playing pool is important. As we really have nowhere to shoot pool where we live, our pool shooting vacation at Los Abrigados is what our vacation is all about. As a matter of fact, the pool tables at Los Abrigados had a lot to do with us buying a timeshare from ILX prior to Diamond’s acquisition.

In your recent interview on FOX Business with Maria Bartiromo, you said you leave your card at the front desk, which leads us to believe you actually care and intervene on behalf of owners who face timeshare challenges after purchasing at Diamond Resorts.

On the positive side, we received good value for our points for our stay here, our unit is very nice, and the staff, especially Daniela serving patrons in the pool table area, is exemplary.

But back to the pool table

The pockets are shot, the rails are shot and they keep moving the table which throws off the balance. A pool table has a slate bottom so you have to be careful how you move it.

I was afraid to play the locals, as they brought their own sticks, because Diamond only provides two sticks. Two sticks!

My new pool playing friends and I eagerly await your response. You never know what may be important to a guest. In our case, the pool table says it all.

seal

Thank you for listening,

Don and Irene

There we have it, another week over in this murky but sometimes humorous world of timeshare, one just never knows what is going to happen next. Maybe the rogue developers and resorts might just get the hint, if they don’t change how they operate, they won’t have a business to operate!

Inside Timeshare again thanks all those who contribute to the articles and especially those who send us the information about some of the dubious firms that are out there. Without you, others will fall into their traps.

Have a good weekend and we hope the weather is great to get out and have BBQ.

BBQ chef

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