Almost 200 Cases Filed in Timeshare Fraud Crackdown in Florida
Florida is one of the most popular states for vacationers and retirees – teal ocean waters and almost year-round warmth make the state a very attractive place to live. Unfortunately, the state’s popularity also makes it a huge target for timeshare fraud.
Timeshare houses and condos allow vacationers to “own” a piece of property with several other owners. While you split the cost, you also split your time in the home throughout the year. It is a very attractive option for people who want to spend part of their year in a particular location, but do not want to pay the entire mortgage on a property they are not in full-time.
However, the popularity of such deals makes the timeshare market attractive to scammers.
Florida state and federal officials say that they have filed 191 civil and criminal cases against timeshare fraud over the past two years. Scams in the business have drastically increased, and scammers are more likely to have violent or drug-related backgrounds.
Reportedly, timeshare fraud started to become more popular in 2009 – just after the economy collapsed – with 2011 being the peak year. In 2012, timeshare fraud percentages dropped slightly.
Miami U.S. Attorney Wifredo Ferrer and Florida Attorney General Pam Bondi say that the state of Florida has sued 9 timeshare companies based in the stat this year alone, and have requested restraining orders against 6 of them.
“We cannot allow our elderly and vulnerable real property owners to continue to be the target of fraud schemes,” Ferrer said in a statement. These victims “looked to sell their units to help make ends meet or pay other bills. Instead, they were defrauded out of more than $14 million in total.”
Although Florida is a large target for timeshare fraud, the state is not alone when it comes to timeshare scammers. In 28 states, 83 civil cases have been filed, and 184 people face criminal charges in federal court for timeshare fraud schemes.
One of the most common types of timeshare fraud comes in the form of timeshare reselling. In a tough economic climate, it becomes much harder to sell property, and scammers have used that to prey on timeshare owners’ fears. They set up “boiler rooms” for phone sales representatives, who call potential victims claiming that they can quickly resell the victim’s timeshare, but only for an up-front deposit of hundreds, and sometimes thousands, of dollars. Then, nothing is done about the property.
Timeshare fraud “involves telemarketing companies that market their advertising services to timeshare owners interested in selling or renting their timeshare interests,” Florida officials said. “Many of these companies charge exorbitant fees and perform few services.”
“The majority of the folks who have been doing this are from Florida and are victimizing people from outside states,” Ferrer said. He also noted that timeshare fraudsters are more and more likely to have a criminal history. “The white collar nature of these scams seem to be a thing of the past,” he said.
Florida Tries to Protect Citizens and Tourists from Timeshare Fraud
Timeshare fraud is so common and detrimental in Flordia that in 2012, the Florida State Legislature passed the Timeshare Resale Accountability Act. The act requires timeshare resellers to provide customers with very specific disclosures before providing services, and also bars timeshare resellers from taking upfront fees. In the year following the legislation, the number of complaints about timeshare fraud fell 57%.
Florida also offered victims of timeshare fraud a specific hotline to call and report companies and phone numbers. Through that hotline, complaints about timeshare fraud tripled between 2010 and 2011, when more than 6,000 people called with a complaint.
“Our message to timeshare owners is simple: Never pay for a promise, get everything in writing first, and pay only after your unit is sold,” said Charles Harwood, acting director of the FTC Bureau of Consumer Protection. “Our message to timeshare scammers is simple, too: Law enforcement agencies at every level of government are working together to put an end to this problem.”
The Strom Law Firm Can Help Victims of Timeshare Fraud
Based in Columbia, SC, the attorneys at the Strom Law Firm have a thorough understanding of both state and federal criminal law. We have prosecuted criminals involved in social security fraud, identity theft, illegal gambling, and other crimes. If you lost money to a timeshare fraud scheme, you do not have to suffer in silence. Contact the Strom Law Firm today for a free consultation. 803.252.4800