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Barclays Partner Finance

Start the Week: A Little Known Name but Integral to Silverpoint

Welcome to the start of another week with Inside Timeshare, last week we ended with a report on yet another fraud that has come to light involving what we have dubbed The Litigious Abogados Family. This time they have used the website and name of a genuine law firm and using it for their own nefarious purposes, the genuine law firm is now well aware of the situation and has taken appropriate action. Today, however, we bring you a name that has not appeared often on our pages. It is well known among the clients of Silverpoint as this person has been an integral employee of many companies within The Limora Group for many years.

When it comes to the long drawn out story of Silverpoint and the many “fraudulent” products which they have peddled over the years, the main names to appear are always the CEO Mark Cushway, the owner of Limora Group, the late Robert “Bob” Trotta and the “Chinaman”, Kwang Boon Sim, Trotta’s financial guru. 

https://insidetimeshare.com/?s=exclusive+breaking+news

One name which has been left out is Diana Aitchison, who has had a very long association with the various companies linked with Silverpoint. Her positions have been varied and in most cases, it has been in senior management working closely with Mark Cushway.

Diana Aitchison

During all this time, Silverpoint was engaged in the sales of timeshare, a product which they completely turned on its head, from the initial “investment” packs of weeks to the culmination in deception, the “Company Participations”.

It is these “company participations” which are of most interest, as this is where Diana Aitchison’s involvement is questionable.

While with Silverpoint, which were actively promoting and selling the “Company Participation Scheme”, it was in fact Diana Aitchison who “signed off” the majority of the purchases.

To recap, this “scheme” replaced the “investment” weeks, where a “victim” purchased a series of weeks, usually 6 to 8 weeks with apartments attached. These were sold with the promise of a rental income, which would cover the maintenance fees, and after a two year period, they would be resold at a profit.

We know from all the court cases that this never happened.

The “company Participations” scheme was essentially the same product, but there was a twist. The “apartments” were registered as S.L. (Sociedad Limitada) or limited companies. The weeks were “shares” or as they call them, “participations” in this company, the same “promise” was made as with the “investment” weeks, an income from rental, and eventual “ownership” of the company, (this is the simple version, see link below for further information).

https://insidetimeshare.com/silverpoint-company-participations-is-timeshare/

Now, remember that Diana Aitchison signed off the majority of these deals, with her move from Silverpoint to Excel Resorts as Chief Operating Officer, she was now responsible for the administration of the “scheme”.

Excel is also a major part of The Limora Group, so in effect is the “sister” company to Silverpoint. Excel manages the resorts, Silverpoint sells them. So it was really a move from one branch to another.

When the “companies” are registered, the Administrators are listed as Excel Hotels & Resorts SA, Diana Joan Aitchison and the Only Partner is Silverpoint Vacations SL.

Talk about keeping it in the family.

When checking the company registration for one “company” Palm Beach Tenerife 077 SL, which was registered around 7 years ago, Diana Aitchison is listed as one of the administrators. The sector the “company” is registered in is “Real Estate or Similar”, a very large category.

It also gives a link to other companies with whom she is associated, one of these is Palm Beach Tenerife 117 SL. In this, she is the “Sole Partner” with Excel as the “Sole Administrator”. But it is also the other links that are of interest, which also brings up links with the “inactive” roles with other companies. Some of which are very familiar names indeed.

Company Record for Palm Beach Tenerife 117 SL, notice the sector.
This does bring up alarm bells, so why was she not suspicious?
The registered Address of Palm Beach Tenerife 117 SL
Positions held
Positions held now inactive
Information is publicly available using https://www.infocif.es/

Another link between Diana Aitchison, Mark Cushway and Kwang Boon Sim, is Vacation Finance Ltd, (link to Company House Register below).

https://find-and-update.company-information.service.gov.uk/company/09726642/officers

This company is linked to the Finance Agreements brokered by Silverpoint for the sales of the “investment packs” and the “company participations”. They are also linked in these finance packages with HMC Finance, and all loans went through with Barclays Partner Finance.

Now considering the length of time Diana has worked in this particular industry and given all the links that she has, it does make you wonder how she could not have known that what was going on was a fraud of epic scale, surely she must have had her suspicions?

We ask this question for one simple reason, the legal battles in the courts over the sales made by Silverpoint and formerly Resort Properties, have been going on for around 12 years. It may be longer, but it has been well known that a possible fraud was being committed and this is being borne out now in the courts.

What actually started this quick research into Diana Aitchison was information received by Inside Timeshare of her involvement with a charity, of which she has been a director since 2014.

Our informant was rather disturbed that she was involved, especially as a director given her links to one of the most investigated frauds in timeshare history, it was also the fact that a person with a link to HMC Finance was taking part in an event for the charity and is personally known to Diana.

It obviously made us think, surely with her involvement in companies which are being criminally investigated, an investigation which has taken on an international hue, her position as a director of a charity is untenable?

We leave you the reader to decide, but we know what our answer will be!

The story of Silverpoint is going to be with us for some time, as the results of the investigations become public, we are bound to find some very interesting twists to the plot. It might take a long time, but the truth will become known.

To end today’s article, we have just received information of another name of a genuine law firm that appears to have been used by our friends The Litigious Abogados Family. Further information on this will be published once the facts are established. WATCH THIS SPACE!

Translations

Danish

https://insidetimeshare-com.translate.goog/start-the-week-a-little-known-name-but-integral-to-silverpoint/?_x_tr_sl=en&_x_tr_tl=da&_x_tr_hl=en-GB&_x_tr_pto=nui

Dutch

https://insidetimeshare-com.translate.goog/start-the-week-a-little-known-name-but-integral-to-silverpoint/?_x_tr_sl=en&_x_tr_tl=nl&_x_tr_hl=en-GB&_x_tr_pto=nui

Finnish

https://insidetimeshare-com.translate.goog/start-the-week-a-little-known-name-but-integral-to-silverpoint/?_x_tr_sl=en&_x_tr_tl=fi&_x_tr_hl=en-GB&_x_tr_pto=nui

German

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Norwegian

https://insidetimeshare-com.translate.goog/start-the-week-a-little-known-name-but-integral-to-silverpoint/?_x_tr_sl=en&_x_tr_tl=no&_x_tr_hl=en-GB&_x_tr_pto=nui

Swedish

https://insidetimeshare-com.translate.goog/start-the-week-a-little-known-name-but-integral-to-silverpoint/?_x_tr_sl=en&_x_tr_tl=sv&_x_tr_hl=en-GB&_x_tr_pto=nui

Timeshare Sales and Finance Agreements

Timeshare is not a cheap product, not just the ongoing costs of the annual maintenance fees, the costs of flights and not to forget the money required to feed and water your family during your stay, but the initial cost is high, to say the least. The average cost of a week’s worth of basic timeshare begins around the £10,000 mark, from many of the legal cases we have highlighted that cost has been two to four times that amount.

For those who became involved with Resort Properties which then became Silverpoint, we have seen figures going as high as £100,000, in some cases more. The reason for these high figures, as we now know, was the “investment” pitch, the purchase of multiple weeks and apartments with the promise of a rental income and then a sale of the weeks for a sizable profit.

These never materialised, a fact we can see in the court cases in Tenerife and the subsequent liquidation of Silverpoint. We also know that it did not end with the first purchase, after the two to three year period when the weeks were eventually to be sold, the unsuspecting “investors” were then told the weeks and apartments they purchased were not popular so were not selling.

Never mind, Silverpoint would take them off your hands and sell you better weeks and apartments, and so it went on.

But how were these huge purchases financed, from many of the statements from these victims, they told the sales staff it was not affordable, but that was not a problem according to the salesman. He and his manager can arrange finance, in this case through Barclays Partner Finance.

It was a simple process and the loan application would be granted without any problems, and so it was. By the end of the presentation, the “victim” had purchased the timeshares and signed the loan application. By the time they returned home, BPF had already sent the letter congratulating them on their purchase and for using BPF!

So what is the problem I hear some of you ask?

The problem is very simple, the loans were granted without all the usual checks that one would expect for a loan ranging from £30k upwards.

This is not unique to Silverpoint, other timeshare sales companies used the same technique to “broker” loans for the purchase, the “guaranteed” acceptance for the loan. All were accepted by the various finance companies they used, without question.

The three main finance institutions involved with timeshare finance are Barclays Partner Finance, Hitachi and Shawbrook Bank. Only Shawbrook Bank has acknowledged they did not do their “due diligence” when authorising these loans. They set aside around £9 million to cover any defaults in repayments for these loans and the then CEO was forced to resign. See the link below on their admission.

https://insidetimeshare.com/shawbrook-bank-announce-irregularities-timeshare-loans-similar-activities-usa/

So what do we mean by “Due Diligence”?

Very simply put, it is the lender making sure that their money is secure and will be repaid.

How many of you have gone to your bank or a finance company to ask for a loan for a sizable purchase, it may be a new car, an extension to your home, anything where a large loan is required. From personal experience, the loan was never as straightforward as it has been with purchasing a timeshare.

Apart from the simple credit checks, i.e. any CCJs or defaults, proof of income is required, usually, at least the last 3 months pay statements, for yourself and the wife if you are married. Then there is the all-important Income v Expenditure statement, in this, you will show your monthly outgoings, this is everything, from household bills, right down to what you may spend at work for lunches and coffee per month.

From this and the proof of income they can see if the loan repayments are actually affordable, that you have the “spare” income to cover the repayments without leaving you “short”. In other words “responsible lending”.

Shawbrook admitted they had not done this vital part of the application, they and the other finance companies relied on the information provided by the “timeshare sales staff”, who had a vested interest in making sure the loan was approved.

This is now where we have a problem.

It has always been the way in most sales and especially timeshare, that they are commission-based, in other words, no sale no pay. Some timeshare sales did pay a very meagre “basic” but in many instances, these were based using the old “On Target Earnings”, you don’t make your target you don’t get paid.

This means that the pressure to get you to purchase is going to be even stronger, no matter how you may try to explain you cannot afford the price, the loan option is always going to put more pressure on you to sign.

We must also not forget that the salesman also receives a commission from the finance company, so it is a double-dipper for them. Somehow I see a very “unfair relationship” here, the salesman wants the sale and the lender wants the business. After all, the total repayment is around double the original purchase price, these loans are not cheap.

A Typical BPF Loan Agreement showing the total cost of the timeshare with interest.

For the finance companies to rely purely on the information supplied by people with a vested interest in making the sale with a loan, is in our book totally irresponsible. At least Shawbrook admitted as such.

So far in all the cases that Inside Timeshare has seen on this subject, not one client has ever had to show any written proof of income or have had to provide an “income v expenditure” report. At no point has any of this information been provided by the lenders, even though upon request they must produce it, they have not even been able to produce any of this information on the loan application provided by the timeshare sales.

This would suggest that there is a very serious problem here, it also becomes more serious when we look at the loans and the timeshares they were used to purchase. The vast majority were made in Spain, which with their very strict and consumer-friendly timeshare laws, these loans were used to purchase a product that has been deemed illegal according to the law.

For these institutions to be a party to the underhand sales techniques used in timeshare makes them in our opinion worse than the timeshare companies. We have to ask the question, were the finance institutions duped into these loan agreements by timeshare or was it just greed on their part?

Somehow I think your answers will be the same as mine, GREED!

If you purchased a timeshare in Spain after January 1999, then your contract may just be illegal, if you would like to know for certain and the purchase was also made using a finance agreement, then please use our contact page and Inside Timeshare will get back to you.

Friday’s Letter from America: Timeshare Foreclosure

Welcome to this week’s edition of Letter from America, this week Irene Parker answers a question asked by many consumers when it comes down to loans/mortgages for the purchase of timeshare. This is very much a problem for our US readers as in Europe and especially in the UK all loan agreements are considered personal loans to purchase a product, any default on the loan agreement is a civil matter and is dealt with by the County Courts. The courts can order the repayment or send in the bailiffs to seize personal property to the value of the loan. The timeshare will not be seized as the loan is not collateralised by the timeshare, after all, it is worthless.

There are not many figures available on County Court Judgements made for defaults on these loans, mainly because they are listed as personal debts not attached to anything but a debt to the lender. For instance, you may have taken out a loan for home improvements, this is treated exactly the same as a loan for timeshare. It should also be pointed out that a County Court Judgement commonly known as a CCJ destroys any credit rating and will prevent you from getting any further finance. Now, considering the average age of timeshare purchasers, they are of a generation that will pay off these defaults as a debt is a debt and to receive a CCJ is out of the question. It should also be pointed out that even if consumers receive a CCJ, they are unlikely to advertise the fact on these timeshare forums, after all, it could be very embarrassing.

Is a Timeshare Foreclosure an Installment Loan Foreclosure or a Mortgage Foreclosure? 

See the source image

Is a Timeshare Foreclosure Considered Mortgage Foreclosure? 

https://gustancho.com/timeshare-foreclosure-considered-mortgage-foreclosure

On the credit report yes, but not with mortgage lenders:  Per HUD mortgage lending guidelines, a timeshare is not treated as a regular foreclosure and is treated as consumer debt. 

The U.S. Department of Housing and Urban Development (HUD), the parent of FHA) classifies timeshare mortgages as installment loans and not real estate loans.

By Irene Parker

July 23, 2021

Over the past year, there have been six disturbing reports that indicate timeshare developers are becoming more aggressive in pursuing members who default on loans. If the reports listed below obtained from credible sources are accurate, timeshare buyers should NEVER finance a timeshare, and timeshare attorneys will be provided substantial job security. If you get sued, you need an attorney. There is nothing to prevent a timeshare company from suing a member, but it is more difficult to collect on a timeshare judgment as the loan is not collateralized with anything but the timeshare.

Last week on TIMESHARE TALKS Jessica Burke of Virginia Beach Timeshare Rentals discussed the benefits of renting timeshares. Renting avoids the initial outlay, and more importantly, gives the consumer time to evaluate different timeshares so as to make an informed decision as to which timeshare might be right for their family. Host John Raymond is a licensed timeshare broker and founder of Resort Reseller. Timeshares can be purchased on the secondary market for a fraction of the cost.  

https://tarda.org/f/should-i-buy-a-timeshare-or-rent-one

The lead spokesperson for ARDA-ROC, the timeshare industry lobby’s consumer advocacy arm, encouraged judicial foreclosure in about-face quotes:

“The best thing we can do with exit (is) judicial foreclosure, ruin the credit and enforce the contract,” said Ken McKelvey, chair of the American Resort Development Association-Resort Owners Coalition, according to letterhead minutes of the April 10, 2019 ARDA-ROC meeting.  (Contacted about the meeting notes, ARDA did not dispute their authenticity but said that in the minutes, McKelvey’s quotes were taken out of context.)

At a 2019 Florida legislative workshop I attended, Mr. McKelvey testified:  

“Most of the developers I know and certainly most of the timeshare managers I know, and I managed timeshare properties for thirty years… every single resort had a dissolution policy, every single one (one). There was a way to get out. You had to come to your management company, and based on what the board of directors instructed us to do in the terms if they had to pay a fee or if they had to be current, whatever those situations were, we did not have a one that did not have a dissolution policy and a hardship policy….” 

Timeshare members donate $5 to $10 per contract to ARDA-ROC in mostly “opt-out” donations. These donations are not as voluntary as they sound. When I asked that the $7 not be charged to my credit card along with my maintenance fees, it was charged anyway. When I called to ask that the $7 be removed, I was told they had to fill out an internal form to do so. That was back in January. Another member recently reported they had to call three times to have the $7 removed. Collectively, ARDA-ROC raises approximately $5 million a year from members.  

Following are five additional disturbing reports:

  1. One developer’s contract used to specifically state that they do not pursue summary judgments. That language has been removed.
  2. Eric Olsen, an attorney of 42 years, was quoted in Kiplinger, to the ire of timeshare developers, when asked what happens when someone stops paying: “I ran this often-asked question by Salem, Ore.-based attorney Eric Olsen, founder of HELPS, a national nonprofit law firm that helps lower-income seniors with debt they can’t afford to pay. Olsen concluded our interview by urging readers to, “Consider walking away from the timeshare, as they generally have no value. Stop paying and ignore their communications.   It will eventually get foreclosed and owing any deficiency is highly unlikely.” Kiplinger, April 26, 2021  
  3. Westgate’s VP of Mortgage Services stated in recent court documents that Westgate “probably” has a 30% default rate. Westgate’s lenders can’t be happy with that high default rate. Other developers have default rates that exceed 20%.
  4. Hilton Grand Vacations and Orange Lake/Holiday Inn have sued members defaulting on loans, according to one exit provider.
  5. Another source reported an upsurge in attorney hiring.    

What does this mean to timeshare members and owners?

According to HomeGuidesSF:

The company may sue you in civil court to obtain a judgment. If the judge issues a judgment against you, the management company may garnish your wages or levy your bank account to get the money you owe.

Deeded timeshare owners face a different dilemma. If you stop paying on your timeshare loan, you face foreclosure. Foreclosure is the process whereby the lender files to take possession of the property and sell it at auction to recover the money you owe. There are two main types of foreclosure: judicial and non-judicial foreclosure. In a judicial foreclosure, the lender files a foreclosure lawsuit and takes you to court. The judge may issue a deficiency judgment for the remaining balance due after the auction. A non-judicial foreclosure is basically a paperwork shuffle. Your contract authorizes the trustee to sell the timeshare in the event you stop paying on it. You receive the official Notice of Default and the Notice of Sale. In California, the majority of foreclosures are non-judicial foreclosures where the lender cannot receive a deficiency judgment after the sale of the property.

https://homeguides.sfgate.com/can-sued-not-paying-timeshare-51679.html

Yahoo Finance reporter Abigail Fisher recommends timeshare stocks because consumers are tricked into signing contracts they can’t get out of: 

Best Stocks to Buy According to Hedge Funds

We find evil companies to be a very rewarding hunting ground to uncover long-term stock winners. In our opinion companies like Philip Morris (PM), Facebook (FB), Apple Inc. (AAPL), Alphabet (GOOGLE) are evil companies that delivered 1000% or more gains to their investors.

In this article we are going to look at another set of evil companies that use high pressure sales tactics to trick consumers into signing complex long-term contracts that they don’t understand: timeshare marketing companies. Check out this Reddit post where the user is asking several questions about Wyndham timeshare cancellation. This person was able to cancel and receive a full refund, but many consumers don’t cancel within the 7-day or 10-day window specified in their contracts.

https://finance.yahoo.com/news/best-timeshare-stock-buy-according-135051667.html

How would this reporter feel if the buyer tricked, was her grandmother? Tiffany’s parents were kept for 11 hours, their IDs withheld. They lost their two deeds they had since 1998, and $34,000. They were told that if they didn’t convert their deed to points, maintenance fees would increase from their current fees of $2,000 to $6,000. The transaction resulted in maintenance fees of $6,000 which they could not afford. Tiffany’s interview: 

https://tarda.org/f/how-giving-up-deeded-timeshares-turned-into-tragedy

Many timeshare members and owners, who report unfair or deceptive sales and marketing practices, are senior citizens in their 60s, 70s, some in their 80s and 90s. They have maintained lifelong high credit scores, but are faced with little choice but to default on a timeshare loan if the resort dismisses their complaint because they signed a contract. There is little to no secondary market. Coupled with interest rates ranging from 12% to 20% (higher if credit card financing), a timeshare can become a financial nightmare. About a third of those reaching out are younger. The youngest was 19 and pregnant when she signed a perpetual timeshare contract at midnight – after a six-hour presentation.

Timeshare members can negotiate directly with their resort to resolve a dispute, but expect to be challenged with: 

  • You signed a contract,
  • Your allegations are unsubstantiated, 
  • We are not responsible for what our sales agents say,
  • You didn’t question this on the recorded closing (because you believed the sales agent or were coached on what to say or not say). 

How can this posturing and ongoing war between developers and those providing exit services be healthy for the timeshare industry? 

People, members of the media, and even the Federal Trade Commission have started addressing why thousands of members reach seeking release from an unwanted timeshare. The FTC lists Timeshare Sales at #7 on their current Top Ten Scam list and Timeshare Resales (fake buyers) #10.

Related Articles: FTC:  Timeshares: Yes? No? Maybe?

https://salinapost.com/posts/5de93b95-4ba0-4acb-8527-80dd7effccaf

Top Ten Scams

https://www.aarp.org/money/scams-fraud/info-2020/ftc-top-scams.html

Senior Defaults

https://www.linkedin.com/pulse/senior-timeshare-defaults-irene-parker/

HOAs Benefit from Onsite and Offsite Timeshare Resale Programs

https://tarda.org/f/hoas-benefit-from-onsiteoffsite-timeshare-resale-programs

Thank you Irene, a very interesting article and I hope it helps to answer some of the questions we receive.

It should also be pointed out that in the UK, one bank, Shawbrook Bank, did acknowledge a few years ago that they did not carry out their due diligence when authorising timeshare loans, meaning many agreements were signed without the affordability checks. The bank set aside around  £9 million to cover any defaults on these loans as they would have had great difficulty in enforcing these loan agreements in the County Courts. The CEO at the time was forced to resign as he was the one that arranged the agreements with the timeshare companies.

Another point is all timeshare sales companies must be authorised in order to broker these loans, before April 1st, 2014 these would have been authorised by The Office of Fair Trading and from that date by the Financial Conduct Authority. A case that Inside Timeshare has been following was the validation of these agreements by Barclays Partner Finance for loans brokered by Azure Service Ltd who were not authorised. This validation order would legalise the loan agreement and make it enforceable in law.

Inside Timeshare has already uncovered many timeshare companies who brokered loan agreements with various lenders and have found that the vast majority have never been authorised. This investigation is ongoing and is being used to end loan agreements.

That is all for this week, have a great weekend, and join us again next week for more news and information on the murky world of timeshare.