Timeshare scams come in many forms these days. Of course, there’s a multitude of timeshare companies that practice deception and fraud on a daily basis, but they aren’t the only ones looking to rip off consumers. Timeshare resale fraud is one of the top fraud targets of the Federal Trade Commission.
There are plenty of scammers looking to capitalize on owners of timeshares who want to sell their unit and get out of their timeshare contracts. These timeshare resale companies effectively scam thousands of people by feigning sympathy for the dire situations they are in. They lure in customers by saying they already have buyers waiting, when in reality no such deal exists. We’ll cover some timeshare resales companies under investigation and how to identify a resale scam.
Companies that sell timeshares for resale have gotten away with fraudulent practices for decades. But as more laws to protect consumers have been put in place, there have been more timeshare resale companies under investigation for misconduct. Here are some of them.
Pro Timeshare Resales was one of the timeshare resale companies under investigation in 2016 for defrauding thousands of timeshare owners. On several occasions, this company promised customers that they would locate a buyer or renter for their unwanted timeshare in a specified period of time for a specified amount of money. They charged their customers upward of $2,500 for services that they ultimately failed to follow through on.
Pro Timeshare Resales was guilty of charging at least $15 million dollars worth of upfront fees all based on these false promises. The FTC had to issue 8,088 checks totalling $2.7 million worth of upfront fees paid out to the scorned customers of these unsuccessful resales. Eventually, the company was forced to halt operation
Aside from timeshare resale companies under investigation, there are also individuals who have been caught committing fraudulent timeshare transactions. The Daily Press reported that in 2016, a Williamsburg-area lawyer named Deborah Wagner was under investigation for forging timeshare transfer documents for straw purchasers — people with no genuine interest in purchasing a timeshare who served as co-conspirators and were paid to assist in the scheme.
She told the original owners of these resales that once the transfers went through, they no longer had to pay their timeshare fees. This resulted in more than $2 million of unpaid fees to timeshare resorts. She eventually pleaded guilty and was sent to prison for four years.
Another case of fraudulent resale activity was committed by a group of individuals posing as representatives for Fidelity National Timeshare. These individuals went by the names of Janet Finklestein and Robert Alexander.
Ms. Finklestein urged timeshare owners to wire her upfront fees in exchange for false resale services. Mr. Alexander reached out to consumers with false claims that an interested buyer was willing to purchase their timeshare. Fidelity National Timeshare investigated the situation and informed customers to avoid resale claims from these people and other individuals with similar claims.
Successfully making a sale on the resale market can be nearly impossible for a multitude of reasons. The demand for used timeshares is much lower than that of new timeshares.
Additionally, the market is oversaturated with timeshare owners listing their properties for nearly nothing. All they ask in return for these virtually free timeshares is that the new owner pay the closing costs and monthly maintenance fees. Even people with units at luxury timeshare resorts like Wyndham and Hilton Grand Vacations have a hard time selling.
The difficulty of this process is why so many people seek the help of a third-party reseller. These resale companies claim to have access to a network of interested timeshare buyers and will go to great lengths to convince you that they’ll get you a deal. Though legitimate timeshare resale companies do exist, resale scammers heavily outweigh the good guys in the industry. Let’s identify some red flags that indicate the resale company you’re working with might be a scam.
Any time you work with a company that’s providing you a service, you should expect to pay upfront fees. But these fees shouldn’t be unreasonably large, and they shouldn’t be paid without explanation.
A common thread of many timeshare resale companies under investigation is a lack of transparency with customers. They charm timeshare owners into paying hefty expenses for unexplained appraisals, commissions, and processing fees but without actually clarifying what these costs are going toward. Don’t hand over your credit card or make a wire transfer before knowing exactly what your money is being used for.
Timeshare resale companies always operate with a heightened sense of urgency. They push you to act fast so you don’t have time to ask anything that might make you question their legitimacy. They strive to get consumers to sign a resale contract before having enough time to review the documentation or talk to a legal consultant. This means that you could be agreeing to a number of absurd policies that are set up to scam you.
Look out for resale companies that get your phone number from an unidentified source and make unsolicited calls to promote their services.
For example, a company that frequently uses this practice is Timeshares By Owner. This resale company has a 1.1-star rating on Consumer Affairs and 39 complaints on its Better Business Bureau (BBB) page.
Timeshares By Owner’s numerous one-star reviews claim that the company harasses its customers with constant phone calls, repeatedly asks for more money to better advertise their listings, and ultimately just sits on customers’ money without actually finding them a buyer. It would see this company is unaccredited on BBB for a reason. While we haven’t found evidence that Timeshare By Owner is a timeshare resale company under investigation, these practices are red flags that they are a company to avoid.
Many of the timeshare resale companies under investigation are guilty of making radical claims that end up being false. A lot of these companies reach out to potential customers saying they already have a buyer interested in their property, though they’ll refuse to reveal the identity of the buyer.
They’ll also guarantee you a timeshare sale within a given amount of time. Some even claim that they’ve already sold your property and that they’ll reimburse your upfront fees once the sale is processed.
In reality, achieving a timeshare resale is never this easy — and it certainly can’t be done without a lot of work on your end. If a resale company guarantees that they can or already have a solution and a buyer waiting to take on your timeshare, they are lying.
Many of the indiscretions committed by these timeshare resale companies under investigation parallel the indiscretions of timeshare developers. That’s no coincidence. The timeshare industry is known for exaggerating, making false promises, and having end results that don’t match up with their initial offerings.
Sadly, many timeshare companies, timeshare exit companies, and timeshare resale companies are lousy with lying salespeople looking to take advantage of you and your money. And thousands of people fall victim to them every year.
Don’t be like the victims of these timeshare resale companies under investigation. Instead, reach out to the timeshare exit team at Centerstone Group. We know all the tricks that the fraudulent timeshare exit and resale industry uses to victimize innocent timeshare owners. That’s why we treat each of our customers with the utmost level of communication and transparency.
We know how to navigate release for our clients and may be able to help find the right solution for you. Contact us for a free consultation.