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Arizona Attorney General’s “Assurance of Discontinuance”

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

objectives

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

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

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

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

Both Facebook groups provide updates on legal and legislative issues.

arizona-ag-seal

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:

https://www.azag.gov/press-release/attorney-general-brnovich-announces-800000-settlement-diamond-resorts

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

Meeting chart

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.

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

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.

writing thoughts

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.

 

The Tuesday Slot: Arizona House Bill 2639

Welcome to The Tuesday Slot, this week Irene Parker continues our articles on the Arizona House Bill 2639, with a contribution from Fran D, a Registered Nurse.

ARDA Timeshare Lobbyist Don Isaacson Opposes Arizona House Bill 2639 – A Bill to Safeguard Timeshare Buyers

ARIZONA TIMESHARE BILL PASSES OUT OF HOUSE COMMITTEE

By Irene Parker and registered nurse, Fran D

March 5, 2019

Arizona has proposed a timeshare bill to protect timeshare buyers, but this bill is being contested by timeshare lobbyists. If Arizona HB2639 passes, it would help to protect consumers from fraud and deceptive sales practices by allowing a 14 day rescission period, among other safeguards. Fran, an Arizona resident, hopes that by sharing her timeshare experience that took place in Sedona, Arizona, and Maui, Hawaii, it will help lawmakers understand what buyers face when purchasing a product improperly presented.    

Timeshare members pay $5 million in annual “voluntary” donations to ARDA ROC. ARDA is the American Resort Development Association and ROC is Resort Owners’ Coalition. Out of 717 timeshare families who have reached out to Inside Timeshare, not one member could tell me what ARDA ROC stands for.

Timeshares have little to no secondary market. ARDA ROC has launched 8 Tips to Navigate the Resale Market. I contacted 22 licensed brokers. Not one would accept a listing for my timeshare points, feeling the restrictions placed on the use of secondary points too restrictive. For the members of my timeshare company, there is no resale market. http://www.ardaroc.org/timeshare-resales-resource-center.aspx

Many of the families affected by the lack of a secondary market for timeshares have been financially devastated. The majority of our readers have reported unfair and deceptive timeshare sales practices.

ARDA – Is this is our voice?

According to ARDA lobbyist Don Isaacson:

But the bottom line, said (ARDA lobbyist) Isaacson, is that the state should not step in to protect people who didn’t bother to understand the nature of the deal.

“You read the documents,” said Isaacson. “And unless there is fraud, you are bound to that particular purchase.”

Anyway, Isaacson argued that too much is being made of the issue. He said the 250 complaints a year to the Attorney General’s Office pale in comparison to the 600,000 timeshare units owned in Arizona.

















What Mr. Isaacson doesn’t understand, is that members are bound by the contract, despite fraud, with the vast majority of complaints alleging deception dismissed with “You signed a contract.” It’s not that buyers don’t understand the product. It’s that they understand the product as it is so often deceptively presented. Three major timeshare companies have received, respectively, over 2,000, 1,000 and 800 Better Business Bureau complaints over the last three years.

When buyers complain, they are typically told they signed a contract. How many people buy cars and houses without relying on reading every word of a contract, relying on the ethics of the real estate or automotive broker? It is only in timeshare that the oral representation clause is so abused and so overused. The industry itself calls deceptive practices “pitching heat,” a term unique to timeshare sales.

There are many ways to deceive, such as:

“This is a new program, so don’t say anything because I could get fired.”

Access to booking is not allowed until after the rescission period, so reading the contract would not help.

Wait until you make a few payments before refinancing – when banks don’t finance timeshares.

Fran’s complaint, recently sent to the Arizona and Hawaii Attorneys General, was dismissed by the company, responding that there were no misrepresentations. You be the judge. She will file complaints with the BBB, the FTC, the FBI at IC3.gov and the Securities and Exchange Commission.

Fran hopes ARDA lobbyist Don Isaacson reads her complaint. She will be reaching out to the following Arizona representatives involved with the bill:

Excerpts from the complaint Fran filed with the Arizona and Hawaii AG offices:

  • We purchased 8500 points in Sedona Arizona April 24, 2017.
  • Purchase price: $29,955.00
  • Down payment: $6,150.00
  • Amount financed $23,805.00

Sales agent Eric told us that we were buying points at a low rate, less than $ 4 per point, and that “at this price the point value can only go up.” We could sell some points at a profit and keep the original base points for travel. Ultimately getting our entire purchase for free, he called it a “401-V”.  He said he would lock the price for one year in case we decided to get more points later to utilize our “401-V”. We have since learned Diamond points are virtually worthless on resale.

The forms were long and extensive. We asked for time to review the documents but were pressured into signing “today” or not get the price per point offered.  After seven hours, my husband got upset and left. Eric followed us to our room insisting that we sign. We thought that Eric must be telling the truth, because if he wasn’t, there would be some sort of regulation. We incorrectly put our faith in Eric.     

We were referred to ARDA. ARDA’s advice leads members to scams, as licensed brokers will not even accept a listing for Diamond points, feeling the restrictions Diamond places on the use of secondary points excessive.

Virginia Beach, August 2017

The sales agents in Virginia were also very high pressure. They told us what we bought in Arizona was not worth it for us and that we had to purchase another 8500 points in order to keep the price of less than $4 per point.  The agent said that after that day the price would be higher. We did not buy. Being deceived into attending the presentation, under the guise that we were getting an education toward our membership was unfair and deceptive. The insistence that we had not purchased enough points made us so angry we did not buy.      

Maui, Hawaii, February 12, 2018

We purchased an additional 5,000 points and switched our US Collection points to the Hawaii Collection to total 13,500 Hawaii Collection points.

  • Purchase price $56,510.00
  • Down payment of $2,731
  • Amount financed $47,713.00

We met with sales agent Sequan R. This again ended up being a hard sell when we told him that we were expecting more of an educational meeting. He said he would give us all the education we need as he had left the company to give independent conferences to teach people how to maximize and exit a timeshare through “Timeshare Confidential Seminars,” but said Diamond hired him back to the sell side of the industry. We were again told “You can’t travel to where you want to go with what you have.” We have since learned that 8500 points were enough points to meet our needs.

Sequan told us we could use a program called Club Combinations at least six times a year to rent out to generate income that would offset the cost of our mortgage. Sequan also told us that we are lucky that the agent in AZ locked in the price because points have already gone up to $8.00 per point so we could already sell points and double our money.  Sequan said that many more high income level people are coming into this resort for the investment which is why the company started the rental program. He said at that income level people want to see a good return on their investment. I told Sequan I did not have time to spend on rentals because I work a lot of hours. Sequan said that the company would appoint someone to help us so we could start to offset our cost right away. I asked Sequan what if they don’t help us. He gave us his cell number and said to call him if that happens. We called Sequan but there was no person by that name.

Later we called and asked how to rent out our club combinations listings.  We were told there was no such program. There was no such thing as a rental program or selling of points for a profit.

Most buyers are on vacation without funds available for a large purchase, so end up signing off on high interest rate loans.  We went into debt to invest in Diamond’s timeshare points.

We had hoped for great vacations and the ability to sell some points for profit as had been explained.  Diamond’s motto “Stay Vacationed” for us means being held hostage. This vacation nightmare has become a major stress in our lives. Filing regulatory complaints is like having a part time job. I am a registered nurse and have spent many years working hard. My husband has worked hard for 40 years. We trusted the timeshare salespeople as we would trust any real estate broker, relying on the ethics of the real estate industry. It was a mistake.

Please do whatever you can to pass this bill and not allow ARDA, a paid lobbyist, to change your minds!

Thank you to Fran for sharing her timeshare experience. Inside Timeshare sent a draft of this article to ARDA. They did not respond. Of the 717 families who have reached out to us reporting unfair and deceptive timeshare sales practices, 99 are veterans and active duty service members. Several of the veterans are disabled, five Agent Orange disabled.

Proposed Florida HB 435, in which developers are worried about members deceived by timeshare exit companies, is supported by ARDA. A recent Florida whistleblower lawsuit was filed on behalf of ten former Wyndham sales agents. The actions of deceptive sales agents also harm honest timeshare sales agents.

IMPORTANT LINKS CONCERNING ARIZONA HOUSE BILL 2639

Press Release: http://insidetimeshare.com/fridays-letter-from-america-43/

To Track Arizona HB2639: Trackbill.com

https://trackbill.com/search/#/direction=desc&page=1&sort=relevancy&tracked&upcoming_hearings&type=bills&state=all&session&query=AZ%20-%20HB2639%20timeshare

Proposed HB Bill 2639

https://www.azleg.gov/legtext/54leg/1R/bills/HB2639P.pdf

Request to Speak for Arizona Residents

https://www.cebv.us/rts.html?fbclid=IwAR2784DcGDTFFg0hoQKi_WPJvhNaz7bvoPylIqRLxoBSStSdlH8Z3qGGD_o

The “Kill Bill” Guide – How it Works

https://drive.google.com/file/d/1Y4w31DQFznxoTDZDru86qzDoku3wuHaW/view

Coalition to Reform Timeshare









Preparing a narration for a governmental agency or a timeshare loss mitigation department is difficult for some due to age related issues or language barriers. We’re here at Inside Timeshare, along with our Supporters, to listen and educate. Contact us or one of these self-help groups we feel are not industry influenced if you experienced unfair and deceptive timeshare sales practices.  

We seek to provide timeshare 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/timeshareadvocategroup/

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

https://tug2.com/Home.aspx

https://everythingabouttimeshares.com/consider-exchange-options/

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

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

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

Thank you Irene and Fran, it is now down to you the readers to do your bit and make your voices heard, this bill is to protect you the consumer, do not let the industry that has walked over you for years do it again.

In Spain, the law is on the side of the consumer, the industry is being taken to the cleaners after years of predatory selling, with many other European Countries with timeshare resorts looking to follow Spain’s lead. This is a result of the European Union issuing several directives on what timeshare is and how it should and should not be sold, which each state having to place this into their own laws, Spain was by far the strongest in its implementation. It took many years to get to this stage, but at least the consumer has the full protection of the law.

LET YOUR VOICE BE HEARD!

Attorneys General and Timeshare under Trump

Today’s article just happens to coincide with a rather important day in the USA, it is the inauguration of Donald Trump as President of the United States of America, so what has this to do with timeshare?

Well it is actually quite simple for those in Scotland, back in 2008 there were some very heated debates over Mr Trump’s plan to build an 18 hole golf course and resort in Balmedie Aberdeenshire. This met with considerable resistance from the local people, but eventually Trump won through.

The original plan was to build a 450-room hotel, a second golf course, 500 luxury homes and 900 timeshare apartments along with a second 18 hole golf course. In a recent article in The Guardian newspaper these plans now intend to double the number of homes and timeshare apartments.

According to The Independent Newspaper there appears to be a conflict of interest, although Mr Trump or should we say President Trump, has stated that his company will do “no new foreign deals” during his presidency. But as The Independent puts it he has left this “new” and “deals” open to interpretation.

The Independent article goes even further, it also brings in the fact this proposed expansion coincides with the need for the UK to negotiate a trade deal with the US after the Brexit vote. As The Independent puts it “who would deny a permit to the President of the United States?”

Well, we in the UK and especially those people in Aberdeenshire will just have to wait and see.

In Irene Parker´s article she explains the US side to the question what will happen under the Trump Presidency and the effect to owners.

Links to the Independent and The Guardian articles.

https://www.google.es/url?sa=t&source=web&rct=j&url=/amp/www.independent.co.uk/news/world/americas/donald-trump-organization-golf-links-resort-scotland-aberdeen-conflict-interest-a7534596.html%253Famp&ved=0ahUKEwjEiL656M7RAhUGQBQKHVZkDe8QFghQMAY&usg=AFQjCNEGkuZV4A3k8BIvt65PzkVLNLQbHQ&sig2=oX4Sg73mYZ_Gfsi1hw9UJw

https://www.google.es/url?sa=t&source=web&rct=j&url=/amp/s/amp.theguardian.com/uk-news/2016/dec/22/planners-reject-donald-trump-revised-plans-scottish-golf-resort&ved=0ahUKEwjSkM6q6c7RAhWCxRQKHVVfCfEQFghZMAc&usg=AFQjCNGSyvxRBMaAVBigvOxsbSyrpCkAKQ&sig2=sSbmK7N4TgzLUVG1YI-PHQ

Attorneys General and Timeshare under Trump

By Irene Parker

January 17, 2017

Presidetial seal

There are a couple of movements under way in America, so why should Timeshare be different? Timeshare owners who have been victimized by rogue sales agents are as far apart from the actions of timeshare developers and lobbyists as Trump is from Bernie. Through covert action, timeshare owners have circumvented laws developers supported to jokingly protect our privacy, and began to contact each other. What we have learned from each other’s experiences is shocking.  

http://www.redweek.com/resources/ask-redweek/timeshares-refuse-to-share-owner-lists

Four Attorneys General have taken action to protect timeshare consumers and prospective buyers.  Noticeably absent from this list is Florida Attorney General Pam Bondi, considering Florida is a timeshare mecca center. The timeshare developer lobby organization ARDA will be quick to point out Bondi’s effort to shut down fraudulent timeshare resale scams – vibrant due to little or no secondary market for owners seeking to sell their timeshare. Bondi explains on a FOX Bob Massi Property Man segment:

https://www.youtube.com/watch?v=G6bZDA6pL0o

Resale scam artists are like squirrels. Take out two and four more will arise tomorrow. I received two calls just this week. Of course shutting down 41 fraudulent resellers is a good thing, but did this just clear out the clutter for developers to have a clear path to “legitimate” transfer agents.

When a timeshare company refuses a request to surrender a timeshare contract, never fear! The beleaguered owner can go to a transfer agency with good names but questionable business practices like Redemption and Release and Resort Release. For sometimes as much as $5000 or more, transfer agents will offer a guaranteed “deed-back”, if legitimate, then bundle 25 to 50 contracts and sell back to the developer. Sound similar to the sub-prime mortgage business? It is.

On the other side of the FOX Celebrity fence are Dave Ramsey and Laura Ingraham endorsing Resort Release. In a FOX news interview Dave Ramsey said timeshare has a 98% dissatisfaction rate.

Lisa Ann Schreier, author of Timeshare for Dummies, offers her opinion in her Open Letter to Dave Ramsey and Laura Ingraham:

http://thetimesharecrusader.blogspot.com/2016/11/an-open-letter-to-dave-ramsey-and-laura.html

lecturnSo what does this have to do with Politics?

Pam Bondi made headlines with her handling of the Trump University investigation after asking and receiving a $25,000 donation.

Trump U victims are eerily similar to timeshare victims. CNN reporter Drew Griffin interviews top Trump U sales agent Dave Harris:

https://www.rawstory.com/2016/07/cnn-reporter-hammers-trump-u-instructor-is-that-called-ripping-off-an-old-couple/

There has been a noticeable shift in lobby efforts. Extravagant events designed to curry favor for legislative efforts used to be directed towards politicians and lawmakers. That’s changed. More and more, campaign contributions, lobby sponsored conferences and events are aimed at Attorneys General like Pam Bondi, as pictured, and reported by the New York Times:

https://www.nytimes.com/2014/10/29/us/lobbyists-bearing-gifts-pursue-attorneys-general.html

However, efforts to influence politicians have not gone unrewarded. Timeshare owners and advocates were outraged over timeshare laws passed in 2015 making it more difficult for timeshare owners to be released from contracts.

http://www.orlandosentinel.com/news/taking-names-scott-maxwell/os-gov-rick-scott-signs-bad-timeshare-law-20150617-post.html

Attorneys General working for us:

Arizona Attorney General Mark Brnovich issued an Assurance of Discontinuance following a probe of Diamond Resorts. A settlement of $800,000 has been awarded for restitution:

https://www.azag.gov/press-release/attorney-general-brnovich-announces-800000-settlement-diamond-resorts

Other Attorneys General have come down on the side of timeshare owners, including:

Colorado Attorney General Cynthia H. Coffman, as reported by Business Den reporter Amy DiPierro, concerning Highlands Resorts in Colorado and Sedona Pines in Arizona:

http://insidetimeshare.com/another-us-attorney-general-exposes-deceptive-tactics/

New York Attorney General Eric Schneidermann halted sales at The Manhattan Club in 2014 and is still engaged in an ongoing legal battle:

http://insidetimeshare.com/news-across-pond/

Tennessee Attorney General Herbert Slatery III settled with Festiva timeshare for $3 million:

https://www.tn.gov/attorneygeneral/news/38312

Alongside AGs, the Consumer Financial Protection Bureau conducts an ongoing investigation of Westgate timeshare as reported by Matthew Zeitlin at BuzzFeed:

https://www.buzzfeed.com/matthewzeitlin/financial-regulators-are-looking-into-americas-largest-times?utm_term=.dwoQKVw3QQ#.doJ0ka1K00

Diamond Resorts default rate is the highest in the industry. The rate has increased to 19% over 13% from the prior year, according to National Mortgage News. Diamond credits this to lawyers targeting owners. I like to think of it being caused by owners talking to other owners.

http://www.nationalmortgagenews.com/news/secondary/newly-private-diamond-resorts-tests-securitization-market-1090005-1.html

So what side of the political fence stands the timeshare developer? Pictured to the left of our new President, the King of Versailles and owner of Westgate timeshare David Siegel:

Trump

Thank you to Inside Timeshare for providing a forum that now reaches from England to Australia and to our Diamond member sponsored Facebook page:

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

Globe flags

Inside Timeshare hope that this article has explained to our European readers the problems that US timeshare owners face, and what it may mean to them in the future. Your comments to this article are more than welcome.

If you have any questions about any company that you may be thinking of dealing with or have been contacted by, contact Inside Timeshare and we will find the answers for you.