The Changing Face of Timeshare Scams Pt 2

Over the years we have seen various changes in the scams surrounding timeshare, from the development of resorts in the beginning then the resale scam to the latest of the fake law firms. Once the timeshare is purchased then the never ending problem of who to trust emerges. Today we have a brief look at how these scams have changed, the only thing that ties them together is they want your hard earned cash.

The first scams to take place in what should have been a good product was the off-plan purchase. In the early days when timeshare resorts were proliferating, those on holiday were lured to the presentation deck or showrooms to be sold “The Dream”. These “UP’s” or “Unit Prospects” as you are known, were usually picked up off the street by the OPC’s or the touts with the scratch cards, every single person given these cards would win the Star Prize. Then taken to the deck to claim it and sit with a “rep” for the presentation.

They would be shown architects plans and artistic impressions of what the resort would look like, what facilities it would have and the standard of the apartments. Usually photos of existing resorts would be shown to enhance the quality that you would expect. It was also sold as an investment, you were buying into property or real estate, which would go up in value. In essence you were buying a share in your very own holiday home.

A proposed date for completion would be given and then the hard sell kicked in, for just a small deposit you can secure the week and apartment of your choice, if you could not afford the full price a payment plan or finance could be arranged. After all it would be some time before you would be able to use the resort as it still had to be built.

Unfortunately, many of these resorts were never actually completed or even started, what you purchased was a hole in the ground and “The Dream”. Many of these sales took place in destinations such as Portugal, Spain and its Islands. This did give these countries a very bad reputation.

It must also be remembered that these schemes tended to be run by criminals who needed to launder their ill gotten gains from criminal activities in their own countries. That was the start of the word “Timeshare” becoming synonymous with scams.

Once timeshare was established, the resale scam began to appear, many of these were based on the Costa del Sol which had many timeshare resorts. Call centers were set up, usually in apartments and hidden, remember there was no internet at that time, so making checks was virtually impossible.

The caller would introduce themselves and ask if you still owned the timeshare, once this was established the question of have you thought about selling, as the prices of timeshares was increasing. After all the purchaser did think they owned property!

After establishing what the owner had paid and what they owned, the agent calling would come up with a wonderful story of how they had sold recently for almost double the original purchase price. Once the owner had been hooked with the greed factor, then the agent would be needing a payment to list the property for sale. That would be the last you heard from them or your money.

The next move in the resale scam was the guaranteed buyer, or the corporate buyer, these tended to be the Discount Members Holiday Clubs, such as Designer Way Vacation Club and Club Class Concierge.

These originally worked in 2 ways, the pick up off the street or cold line, the call center targeting timeshare owners through lists. The cold line didn’t generally target owners, but once at the presentation they would establish that you did own timeshare.

With the telephone targeting of timeshare owners, they would be told that there was a buyer who was looking for timeshares, usually a corporate buyer. Once you agreed that you would be interested in selling they would invite you to their offices in Spain with free accommodation, to attend a meeting.

Once at the meeting the corporate buyer turned out to be a sales agent for the holiday club, they would take the timeshare off your hands but to do so you had to purchase membership into the club. You would get a discount for the timeshare and in many cases what was known as Cashback, which was another con in itself.

It the turned out that the discounts promised never materialised, the excuse was always the same, sorry not available on those dates. It also turned out that in many cases several year down the line the timeshare company started for non- payment of maintenance fees. The timeshare had not been disposed of as promised.

Thankfully the main culprits have been closed down, but there are still some about, resale scams still exist, but from what we have seen they are mainly targeting French and Belgian owners and are based in Marrakech.

We now move on to the claims sector which has really started to take off since the first Supreme Court rulings against timeshare companies.

Some of these are very sophisticated frauds, such as those of the Tenerife based family of fake law firms which we have dubbed the Litigious Abogados Family. Their method is very well put together, they even have some excellent fake court and procurator documents.

First they contact the owner, (in some cases the timeshare is no longer owned), with the story that the timeshare company is about to be taken to court and you can be in on the case. You are likely to receive thousands in compensation, but you do have to pay a fee to the procurator. Once paid, give it a couple of weeks and you are then notified that the director pleaded guilty and you have been awarded a substantial amount. Unfortunately there is a tax to be paid, which is 20% of the awarded amount, to back this up the unsuspecting timeshare owner is sent fake court documents showing the sentence and a photocopy of the cheque they will receive. Yes you guessed it there was no trial and you have just lost thousands.

Another ploy is the so-called firms calling themselves lawyers or claims companies, the pitch is simple, you have a claim which they will do on a no win no fee basis, great no legal fees upfront. There is one snag though, you need to cancel the contract first, but guess what they can do the relinquishment for you. All you have to do is pay upwards of £5000 and you will be out, then they will start the claim for you.

In some cases these companies have also used the “bait and switch” tactic to sell their own product, “Leisure Credits” (think Monster Credits) which is a discount club (very similar to the holiday club), again not worth the paper the contract is written on.

What we have seen with these particular schemes from many of our readers is simple, they have never received any money for the claim and they are now being chase for around 3 years of back maintenance. Their contract have never been relinquished.

We have seen this with one company that has gone out of business, RSB Legal. They operated for about 3 years so must have taken hundreds of people for tens of thousands of pounds. It must also be said that the UK authorities such as Trading Standards as well as the police are investigating many companies.

Yes, for the poor timeshare owner it is a very perilous world, a veritable minefield where thousands are lost on an almost daily basis, with very little hope of ever recovering what has been paid.

There are some genuine law firms and claims companies, these will not tell you that you have a claim if you don’t, it is not in their interest to take on cases which are not valid. As for relinquishments, many resorts will not deal with third parties, Ona Group, MGM Petchey, MacDonald Resorts, Diamond, Club la Costa and many more, they will only deal direct with the member. Then in most case the fee they charge is usually far less than what you would pay these other companies.

It now remains to be seen what form the next phase of scams will take, these crooks will always find an angle, after all they do want your money!

So the moral of this tale is doing your due diligence and plenty of homework, if you don’t know where to start, then use our contact page. We are here to give you free advice and point you in the right direction.


3 Comments

  • Suzi Snow

    August 1, 2018

    Very interesting history. Thank you!

    Reply
  • Bunmi A

    August 2, 2018

    I need help to get rid of my timeshare. I lost my job in February and I cannot find one that pay me the same. I contact Diamond Resorts for help to take it from me. I presented all my paperwork and information and all my financial statement. No help. I stop the ACH from my account this month because of overdraft. Please, I need help to get out this trap

    Reply
  • Grainne Brady

    August 12, 2018

    I have been in touch with a company called “Timeshare “Compensation. They are based in Tenerife. We have Floating week’s in Anfi. They say they will get our money back. We are due to fly out to Tenerife in October. Is this another scam?? Would really appreciate your help before we loose any money. Bad enough the amount we have paid to Anfi!

    Reply

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