To recap, Harris fraudulently sold ‘‘fractional ownership’’ was sentenced to four-and-half years in jail.
The judge labelled his operation as a “fraud factory” as people were pressured into buying a £10,000 share to a berth on a yacht- with no right to cancel, maintenance fees on top and extra costs to actually stay on it.
Harris was a keen supporter of the OTE and wanted them to have a mandate.
Below is the full transcript along with extracts from the statement Andy Harris made to parliament.
“Whilst you feel the nanny state should hold the consumer’s hand”
“There is no problem for consumers making advance payments in the resale market”
“Customers should not be allowed to withdraw from contracts”
“You say that timeshare is sold as an investment. However, I find this an extraordinary claim”
“I agree with Mr. van der Mark that you have enough legislation already”.
Mr. Van der Mark represented the OTE which changed its name to the RDO and acted as general secretary of the RDO
My name is Andy Harris.
I am submitting this evidence as an individual. I have been an owner of timeshare since 1986 and I have worked in the timeshare industry in England, Canary Islands and in the Caribbean for about 15 years.
I am a shareholder in four timeshare companies which are involved in development, sales and marketing, resort management and resale’s.
- I agree with Mr van der Mark says that there is already enough legislation; we have the Companies Act, we have the Sales of Goods Act and we are soon to have the Unfair Commercial Practices directive. Therefore, in simple terms, if the product does not do what it says on the tin, the consumer may claim their money back.
It is very confusing for the consumer who reads about UK law being overturned in a European Court of Law, whereas in many instances, the national law overrides and is stronger than the European law. For the sake of clarity for the consumer, I would suggest that the European Union’s timeshare directive should be implemented by all member states and that it should take precedence over any national law. Therefore, if the cooling-off period is to be five days, then this should be the same for everybody and it should override the fact that Germany may want to go for a 50 day cooling-off period.
I agree with Article 3 that companies should provide written information where the consumer requests it.
Consumers have way too much information available to them from far too many different sources. There should be one source to obtain all information on legislation and this should be the Department of Trade and Industry.
The Right of Withdrawal
From a consumer’s perspective the provisions on the right of withdrawal would appear to be very satisfactory. However, as this encourages cancellations, this means that the consumer who cancels an excellent timeshare product is likely to end up doing as they always do, ie staying in sub-standard accommodation at inflated prices through unscrupulous travel agents and tour operators.
You have drawn comparisons between Europe and the US. It has been brought to your attention that some States in the US offer a three day cooling off period. Might I suggest that you look at one of the world’s biggest timeshare user countries, which is South Africa? The Timeshare Institute of South Africa (TISA) is a self-regularity body that governs business practices in the timeshare industry in South Africa. They have a 15 page code of conduct which all timeshare operators must adhere to. This includes a five day cooling-off period. Rather than re-invent the wheel, I would suggest that this is adopted for all EU member states.
Advance Payments
The consumers can best be protected by saying “No”. Timeshares are generally offered to people between the ages of 25 and 65 who are married or co-habiting and who own their own house. The law can only protect them so far. Whilst you feel the nanny state should hold the consumer’s hand, I feel that the consumer should be given more credit for their intelligence. After all, at the age of 18 they are allowed to vote for MPs.
There is no problem for consumers making advance payments in the resale market, so long as the consumer has not been cold called.
Redress
Under Article 9, I believe that the best method of out of court redress should be by a single professional organisation, such as the Organisation for Timeshare in Europe. One of the problems that the consumer has is the confusion created by having so many different parties apparently involved with timeshare complaints, eg the Office of Fair Trading, The department of Trade and Industry, Trading Standards, Citizens Advice Bureau, the Organisation for Timeshare in Europe, the Association of Timeshare Owners Committee, then there are various one-man bands such as Mr Sandy Grey who pretends to head up a consumer organisation.
Sanctions Monitoring and Enforcement
If all monitoring sanctions and enforcement are done by one body, albeit the DTI or OTE, then they should have the power to impose fines accordingly. It should be very simple that any company not adhering to the rules should not be allowed to trade.
I feel that because of the Unfair Commercial Practices Directive that there is actually no need to make any amendments to the Timeshare Directive. I would have thought that making changes with something done as recently as 1997 is over zealous and I would have expected the House of Lords to have better things to do.
Outstanding Issues
If the Directive is to cover many holiday products, then it should be known as the Holiday Directive.
I would now like to cover some other points arising:
Languages
In Article 3 I would suggest that it is difficult for small companies to have everything in different languages. If the customer does not understand the language, then they should either not sign the contract or have it translated.
Complaints
The proposal talks about a significant number of complaints. However, this is not defined. If it is correct that the majority of complaints are to do with holiday clubs, then I agree with the OTE that they should be dealt with separately. In the Consultation Paper by the DTI on the same issues in 2000, it was pointed out that the majority of complaints are post-contractual by members who are concerned about management fees. Therefore, the changes proposed in the current Directive will not address this issue.
Deposits and Cancellations
The proposal talks about member states, consumers and other stakeholders versus the European timeshare industry. I believe the significant contributions by timeshare to the economy should not be overlooked. As an example, holiday bookings in certain areas of the UK are way down due to the poor weather; however timeshare units still retain their high occupancy levels, thus keeping staff employed. By encouraging cancellations and stopping the taking of deposits you will be further damaging the timeshare industry.
Under self-regulations, we would use timeshare trustees who are most certainly trustworthy to hold deposits. As with many other products, the deposit should actually be non-refundable. Customers should not be allowed to withdraw from contracts if they agree to.
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For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk