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It appears that the authorities on Tenerife are not letting the bankruptcy of Silverpoint go unnoticed as Arona’s Investigating Court Number 1 has opened preliminary proceedings against Silverpoint Vacations SL (“Silverpoint”) and Excel Hotels & Resorts SA (“Excel”). The alleged crimes relate to the bankruptcy of Silverpoint, the timeshare operation that centred its operations in the south of Tenerife.

Due to contract irregularities that contravened Spanish timeshare law Silverpoint lost literally hundreds of cases presented to the courts but before these court orders could settle the awarded funds, Silverpoint went into voluntary liquidation in February 2020. Investigation has proved that considerable Silverpoint assets were siphoned, much of which went to offshore companies.

On top of this, investigation proved that significant assets of Silverpoint were also transferred to Excel before the insolvency was announced. Prosecutors in Tenerife are alleging crimes including punishable insolvency, frustration of execution, and procedural fraud.

One of the potential crimes known in Spanish as “alzamiento de bienes” translated in English means concealment of assets. Concealing assets makes it hard for creditors to discover the whereabouts of assets to recover so creditors may be paid. Investigation revealed that millions of Euro assets including timeshare weeks and apartments were removed from Silverpoint shortly before the company filed for bankruptcy.

One of the main recipients of these assets was the resort management company Excel, formerly known as Silverpoint Hotels & Resorts SA. Beverly Hills Club, Beverly Hills Heights, Hollywood Mirage and Palm Beach Club, are currently managed by Excel, Excel in turn are owned by OnaGrup who own and run apartments and hotels throughout Spain and the islands and are based in Barcelona.

The Spanish National Police specialist unit in economic and fiscal Crime (UDEF) has already prepared an extensive report on the links and participation of both companies in the alleged criminal acts.

It’s suspected that Silverpoint and Excel settled a “simulated” lawsuit between them in March 2018, when Silverpoint recognised an alleged debt with Excel and promised to pay by transferring “a very significant part, if not all of its corporate assets”.  These assets included 7,347 certificate weeks, the long-term client portfolio, and a promise to pay Excel 6.7 million Euros.

The investigating judge has requested a list of the contracts concluded between both companies from the origin of their activity to the present. Also requested are lists of all the enforcement proceedings against Silverpoint, detailing the amounts of the sentences, whether they have been satisfied in whole or in part, and in what way, whether voluntarily or urgently. 

 The judge is taking this action, because, according to the prosecutor, these companies acted “in collusion” as part of a plan to avoid paying awards from court sentences. The investigation may also eventually expand to include the advisors of Silverpoint, Excel and its related companies, of which there are many.

No money?

Silverpoint entered into liquidation on the 1st February 2020.  At the time, the company declared assets totalling 14 million Euros, with debts estimated at €28 million. However, the bankruptcy administrator´s report indicates that the company has assets of €83 million and liabilities of €141 million, the debts largely correspond to court awards to former clients.

In addition to the liquidation in Spain, a procedure for the bankruptcy of parent company Limora Investments Limited has been running in the Southern District of New York Bankruptcy Court. This process has highlighted how the timeshare complexes in the south of Tenerife were the main source of income for a huge corporate network of companies stretching across the globe including tax havens such as Dubai, The British Virgin Islands, Panama and Malta. It appears that the Limora Group used shell companies in various jurisdictions to transfer assets around the world, making it difficult for the Spanish authorities to both trace and recover said assets.

Our comment

 We think it fair to say the Tenerife is the timeshare capital of not only Spain but Europe as well. It comes as no surprise that the authorities on Tenerife are taking the Silverpoint debacle very seriously. Timeshare on the island not only brings in millions in tax revenue but also tourist revenue.

It is hoped that those responsible will be punished for their actions and that the criminal prosecution will help clean up the tarnished image of the resort holiday industry in Tenerife. Furthermore, those timeshare owners with court awards will finally see their just awards after what can only be described as extremely sharp and illegal practice.

Mark Cushway

It is not known for certain where the architect of the Silverpoint demise, Mark Cushway is currently located but for sure as far away from Tenerife as possible. It appears that his company, The Inspired Group and the website behind it https://www.markcushway.com/ is still flourishing, although there is no reference to where the company is based or any contact number. Cushway still has a Spanish registered company being Inspired Performance Solutions SL based in Arona but we doubt you will ever find him there.

“As a major shareholder in multiple businesses across the hospitality, leisure, and real-estate sectors, I have used over 30 years of experience to grow businesses worldwide through the development of exceptional products that benefit both individuals and organisations.”

We think “no comment” would be the politest way to end!

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