We thought it about time to revisit this scam because there is a resurgence of cold calls using pretty nasty scare tactics to get you to part with money for a service that has already been completed. Before we go any further, we need to look at the scam.
Rather than us going into chapter and verse, below we reproduce a recent enquiry to TCA which basically explains:
“Hi,
In August 2015 you helped me exit my timeshare ownership at Orange Lake. On October 30th 2015 I received a letter from Orange Lake Resorts advising a ‘Notice of Cancellation’ along with an executed Warranty Deed. As such I have since that time assumed I’m free of the timeshare ownership. However, in the last few weeks I have started receiving calls again saying I may still be liable for ongoing fees and unless I have the three ‘avenues’ of evidence (namely Land Registry, Trustee and Headquarters) I have not fully relinquished my ownership. The latest call was from a Jessica Watson at the Legal Advice Centre, Trading Standards. My assumption is that these calls are bogus but thought I should check with you. Can you please advise.”
This enquiry is very clear in the explanation of the scam. Here we have an ex owner of a timeshare in Florida, TCA assisted the owner and it’s quite clear that the resort/developer confirmed the exit. In this case there can be no doubt that the timeshare contract is well and truly terminated. But not according to the scammers.
Ex owners
From the various enquiries TCA have received, it would appear that these scammers have obtained stolen data, listing ex owners. If a timeshare owner follows the correct procedures to exit their contract or have used the services of a bona fide third party exit company and has received confirmation from the resort or developer, then that’s that, the contract is terminated. Upon termination there will be no more use of the timeshare and all ongoing fees such as maintenance will cease as well.
At this juncture we should point out that to achieve an exit, procedures need to be followed, simply stopping maintenance payments and walking away is not a good idea. Burying ones head in the sand and hoping the problem will go away can certainly bring repercussions in the future, that said, we will look into this a little later.
Scare tactics
The scammers will use all sorts of plausible sounding reasons as to why you are still liable for maintenance fees, all of which will be lies. For sure there are developer back office procedures that need to be carried out, but logic dictates that if a developer confirms the exit then whatever action, such as land registry etc will be carried out internally. Believe us, if you have written confirmation that you are out, then there is no more to be done.
Club la Costa ex owners are a current target, why? Because the scammers try to convince ex owners that as CLC have been taken over by Wyndham, because of this Wyndham will reinstate ownership and charge all the back maintenance fees. One word “rubbish”, firstly Wyndham have not taken over CLC, the relationship is an operational partnership, more akin to a franchise. Secondly, all CLC administration is still being carried out by CLC, not Wyndham. Similar lies are being peddled with the Diamond/Hilton takeover and to a lesser extent, Petchey Leisure and MGM.
Evidence you are out
The most obvious is confirmation from the developer, however sometimes this is not forthcoming. Another sure fire way that ownership is cancelled is the lack of correspondence or maintenance fee demands. The collection of maintenance fees has always been important to developers and is even more so nowadays because sales of new timeshare are dwindling, especially in Europe. Many developers can get quite aggressive towards owners who default on maintenance fee payments, if you are receiving no such demands then it’s practically a given that you are out.
Statute of limitation
In most countries where timeshare is retailed there are laws relating to limitations as to how long a debt may be challenged before it’s extinguished. Simply looking at England and Wales, The Limitation Act 1980 is an Act of the Parliament which created a statute of limitations that provides timescales within which action may be taken (issuing a claim) for breaches of the law. For example, it provides that breaches of an ordinary contract are actionable for six years after the event whereas breaches of a deed are actionable for twelve years after the event. In most cases, after the expiry of the time periods specified in the Act the remedies available for breaches are extinguished and no action may be taken in the courts in respect of those breaches.
As timeshare, in most cases, is deemed to be an ordinary contract then the limit to which a developer may exercise a claim for back maintenance is 6 years. If the developer has issued no invoices or demands for the past 6 year, the Limitations Act steps in.
Naturally in an article of this length we cannot possibly look at all the countries where timeshare resorts are located and report on any limitations legislation, however we will take a quick look at the States. In the USA there are problems because every State may have differing laws, Florida is probably the State with most timeshare resorts so we will have a look at that. The statute of limitations in Florida restricts how long someone has to sue another person after a claim occurs and a legal cause of action arises. The statute of limitations is 20 years for judgment recovery and unpaid property taxes, but 5 years or less for all other causes of action. From this it may be taken that maintenance fees are classified as “other causes” so a limit of 5 years apply.
In our enquiry above, the timeshare was in Florida; our enquirer took action to cancel in 2015. The Florida statute would prohibit the developer for chasing any debt beyond 2020, so either way this timeshare is no more.
Vigilance is key
Only last week PM Rishi Sunak said law will be introduced regarding cold calls which trick people into buying fake investments and will be banned as part of a new crackdown on fraudsters. The Prime Minister added: ‘We have to prevent fraudsters from infiltrating their way into people’s lives in the first place. That’s why we’re stopping scams at source by taking away the routes used to target victims, keeping people safe and shielding them from criminals.’
Naturally, the proposed legislation is not related to timeshare scams, even if it were it would only work if the fraudsters are operating from the UK, those based offshore will still be bullet proof. TCA have established that, although purporting to be UK based often with UK phone numbers and even virtual office addresses, the majority of timeshare scams operate from Mallorca or the Canaries. Given this, the long arm of UK law can do nothing. That being the case, it’s up to each individual be on their guard, be vigilant and carry out their own investigations.
TCA comment
Depending on how you exited your timeshare may certainly have a bearing but as it’s likely the data used by the scammers has been obtained from the developer, illegally we may add, that being the case if the developer has you listed as an ex owner then that’s pretty conclusive. In any event, don’t take what’s said at face value, do your research. We appreciate that the cold call you receive may scare the living daylights out of you, because that’s exactly what its intended to do, but don’t fall for it.
According to our enquirer he said the call emanated from Trading Standards, another brass faced lie. Trading Standards don’t make cold calls and certainly would not have any jurisdiction over timeshare in the USA; this is just a ruse, an attempt to build credibility. Our suggestion to our enquirer was to report the call together with what evidence is available to the local Trading Standards office.
Should you receive such a call do not be coerced into parting with any money in fact best advice would be to terminate the call immediately. If you are at all worried TCA are only a phone call away and are here to help you investigate and offer guidance.
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