In today’s article from Irene Parker, we take another look at the Arizona Attorney General’s settlement with Diamond Resorts. It is a simplified version on the 37 page “Assurance of Discontinuance”, It also goes on to explain who is eligible for thesettlement and gives details on how to claim. It also include the date of the deadline.
This article is a prelude to one that will be published later on “Consumer Protection Week” which is starts on 5 March and ends on 11 March. So watch this space.
An Arizona Attorney General’s “Assurance of Discontinuance”
Is the AOD a Blueprint for the Timeshare Industry?
March 5 – 11 is Consumer Protection Week
By Irene Parker – March 1, 2017
The following Facebook groups are reaching out to those eligible for Arizona Attorney General Mark Brnovich’s $800,000 Settlement with Diamond Resorts. Given the success of the Diamond Resorts Owners Advocate Facebook, assisting Diamond owners who face legitimate concerns, other Advocates have come forward to launch a Timeshare Advocacy Group Facebook available to all timeshare owners.
These groups go beyond helpful posts to actually intervene and assist those unaccustomed to interacting with governmental regulatory agencies and loss mitigation departments. Most are owners struggling under the burden of maintenance fees they can no longer afford.
In 2010, the board of Diamond’s PVC (Premier Vacation Club) amended the Membership Plan to allow an increase to a maximum of inflation plus 25% per year from the original maximum of inflation plus 10% per year.
Diamond’s US Collection has capped Maintenance Fees increases to 25% per year. A15000 point example and history of Maintenance Fee increases provided in the Assurance of Discontinuance:
$1,214 – 2007
$1,348.50 – 2008
$1,686 – 2009
$1,850 – 2010
$1,923.50 – 2011
$2,018.50 – 2012
$2,045.50 – 2013
$2,330 – 2014
$2,404.70 – 2015
Buyers sign a perpetual contract with virtually no secondary market.
Sales are made same day without being allowed sufficient time to comparison shop, as one would if buying a car or house. Certainly the expense and upkeep of a timeshare is equivalent to that of a major purchase.
Owners facing legitimate timeshare issues should consult the following:
Timeshare Advocacy Group
A Diamond Resorts Owners Advocacy Facebook was launched for Diamond Members with legitimate concerns so they can seek help without fear of censor.
Diamond Resorts Owners Advocacy Facebook
Both Facebook groups provide updates on legal and legislative issues.
A time sensitive issue concerns Arizona Attorney General Mark Brnovich’s issuance of an “Assurance of Discontinuance” due to the complaint filing period which ends the end of April.
Not everyone wishes to wade through a 37 page “Assurance of Discontinuance” (AOD) so we have generalized and summarized the key points. To the best of our knowledge, this Assurance of Discontinuance is the first document of its kind to offer a prospective blueprint for timeshare as a whole. In an effort to promote timeshare reform, we encourage ARDA, lawmakers, and timeshare developers to make this a blueprint for the industry.
The actual Arizona Attorney General press release, link to filing a complaint and link to the Assurance of Discontinuance:
Who is Eligible for the Arizona Settlement?
A Consumer who files a written complaint against Diamond Resorts with the Arizona Attorney General, another law enforcement agency, the Better Business Bureau, or the Arizona Department of Real Estate after January 1, 2009 that is received by the Attorney General’s Office prior to the Effective Date or during the Filing Period. The Filing Period is expected to end by the end of April.
The provisions of the AOD are limited to Consumers who did business with Diamond at Sales Centers in Arizona and with Arizona-domiciled Consumers who attend Sales Presentation with Diamond outside of Arizona.
Our Blueprint Proposal
A Quality Assurance Program – Independent from Sales and Marketing
Timeshare sales agents may not deviate from Sales Materials;
Timeshare sales agents may not make oral representation at the point of sale inconsistent with purchase documents:
- Pertaining to the use of Points to book travel arrangements such as flights, rental cars, or cruises claiming such arrangements are comparatively lower in cost than if the Consumer would spend cash for the same travel arrangements, unless such representations are accurate;
- Claim a non-deeded timeshare interest such as Points is a deeded property or may be considered an investment in real property;
- Claim Points appreciate in value;
- Claim Points may be used to pay Maintenance Fees or that Maintenance Fees will be reduced by the purchase of additional Points, unless such representations are accurate;
- Claim Consumers may rent out Points for cash through online or print advertising to the general public unless such representations are true;
- Claim the company will buy back Consumer’s Memberships unless the company offers a buy-back program;
- Claim there is a secondary market for the sale of Points, and that such secondary market has a certain level of sales volume, or provides Consumers with the ability to re-sell Points, unless such representations are accurate.
- Represent to Consumers that the sales agent would assist them with selling their Membership, unless a resale program exists.
- Claim Consumers will be able to obtain a loan from a private lender to refinance a loan.
- Claim interest paid on a points based product is tax deductible unless such representations are accurate. Vacation membership products are not considered “qualified home” according to IRS Publication 936.
- Provide any information that may be construed as tax advice;
- Represent to Consumers that Sales Presentations typically last 90 to 120 minutes if the norm is several hours.
- Call a sales presentation an “informational meeting” to learn about changes to a resort if such meeting includes a Sales Presentations for the purpose of upgrading or up selling the consumer.
- Overstate availability
What happens to the sales counselor when they do not adhere to the above?
How will Consumers know if sales agents violating the above declarations are reprimanded, suspended or terminated?
This can only be accomplished by forming viable and vibrant consumer groups reaching out to other owners. One such Diamond Owner sponsored Facebook was formed by the original owners of Club Intrawest acquired by Diamond, now known as Embarc.
How do Diamond owners get released from their timeshare contract?
What is the “Relinquishment Program” and is it different from Transitions?
“Transitions” is Diamond’s relinquishment program publicly announced by Diamond on May 4, 2016. Unlike the AOD “Relinquishment Remedy Program”, Diamond’s Transitions or Relinquishment Program is offered, on a case by case basis, at Diamond’s discretion and does not constitute an obligation under the AOD.
Preparing a narration for a governmental agency or a timeshare loss mitigation department is difficult for some, especially if English is the Member’s second language. We’re here at Inside Timeshare and all owner groups to listen, educate, disseminate and advocate. Contact us!
Whether you are in Europe or the US, Inside Timeshare and our associates at the various facebook groups, would love to hear from you. It is only with your experiences are we able to inform others that there is help and hope.
Timeshare could be a great product, but we need to let the industry know that it has to change, by putting the members first. We call on the industry to listen and learn from your concerns, work with us to make the change.