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Timeshare Sales: Racketeering and Legal Harassment?

timeshare sales

Have you ever read through pages and pages of timeshare owner sales complaints, and thought “how is this legal?”  In our work as America’s leading timeshare cancellation team (established in 2004), we feel like we’ve seen both the best that the timeshare industry has to offer, and the worst.   But every week, in our free consultation sessions with timeshare owners, we hear one or two stories that still surprise and shock us.

There are so many aspects about the timeshare industry that we feel are unfair, resulting in the kind of stress and financial problems that no family deserves to go through.  How do some of the worst timeshares and allied services (including disreputable resale and rental agents), get away with it?  And why aren’t American law makers and consumer protection agencies more successful at eliminating these types of businesses, before they victimize consumers?

Disreputable Timeshares Feel a Bit Like Illegal Racketeering

We know that all timeshares are not inherently bad.  In fact, we have excellent relationships with resorts who have established a positive reputation for member service and fair practices.   We never disparage those businesses, who have worked hard to reform their business model, and treat their members with the respect they deserve.

But for every good timeshare out there, it feels like there are ten that excel at finding vulnerable consumers, and taking complete advantage of them.   That’s part of the reason why our founder started what is now the leading timeshare cancellation resource in America.  In 2003, he had seen enough of the fraud and abuse in timeshare sales; and he decided to do something about it.

The term racketeering is often associated with timeshares, and it’s not hard to understand why, when you look at the legal definition of it: “A pattern of illegal activity carried out as part of an enterprise that is owned, or controlled by those who are engaged in the illegal activity.  The latter definition derives from the federal Racketeer Influenced and Corruption Organizations Act (RICO) established in 1961 and revised in 1970.” (18 U.S.C.A. § 1961 et seq. [1970])

Timeshares are owned by other timeshares, who are governed by a Board of Directors, that is accountable to investors for sales and profitability.   We are not implying any assumptions about the industry or any specific timeshare, but it is difficult to find out who really owns stocks in certain resorts and fractional membership clubs.  And associations do work together in the industry, both to improve profitability and promotion.

Our biggest concern, and why we think that the description fits in some extreme cases, pertains to the fraudulent sales practices.  YouTube is figuratively packed with disheartening, angry and upset consumers who have had just about every contract law broken, in the purchase of their timeshare.   Many of these consumers make no progress, until they threaten to take legal action.   Timeshares continue to chalk up fees, and penalties while sending sometimes abusive and threatening communications to the owner.

Why is this allowed to persist?  And if a timeshare has integrity, why would they ever let a negative consumer experience escalate to the point of legal action, before releasing them from a fraudulent timeshare contract?  Many timeshare owners we talk to, believe that timeshares collude when it comes to setting incremental maintenance fee increases, on an annual basis.  We’ve never found anything to prove that assumption, but it demonstrates a prevailing negative consumer sentiment; timeshares have an oppositional relationship with their members.  One where the consumer comes last.

Are High Pressured Sales Harassment?

There are many laws that nullify the legal status of a contract, if it can be proven that the contract was written under duress.   There are many ways that a timeshare sales person can cause duress to a consumer, or prospective buyer by:

  • Refusing to allow them to leave the room
  • Refusing to permit them to call a family member or friend
  • Denying them use of a rest room, food or water
  • Extending the sales presentation to an extraneous length (more than two hours) and beyond the length of time agreed to by the consumer
  • Refusing to provide information about the contract when asked
  • Denying the consumer an opportunity to show the contract to a legal professional for advice and review of terms and conditions
  • Refusing to inform the consumer of legal rescindment periods

It was a story shared in 2017 on the  “Inside Timeshare” that prompted us to research whether any timeshare had been formally charged with harassment.  Successful legal case examples, despite thousands of consumer complaints, are difficult to find. Rather than face formal litigation with a consumer, most timeshare companies are more willing to cancel the contract, or take back the inventory, rather than assume additional legal costs.

One thing that many timeshare owners have in common, is waiting.  When you have determined that a timeshare is not right for you, or if timeshare ownership is creating a financial burden, call us to schedule your free consultation at 1-800-587-EXIT. We’re ready to help you get answers, and a resolution to your timeshare problem.