Upfront fee resale company scam complaints tripled in 2009 ....

Complaints over time-share sales schemes rise

When Evelyn Nelson Robb started getting calls from time-share resale companies a few years ago, she thought it was just what she needed to finally unload her property. But now, after losing $17,000 to such businesses, all she feels is scammed.

Nelson Robb, an 81-year-old Missouri resident, says she was hoodwinked by several time-share resale companies, many from Florida, that promised to help her get rid of two properties she owns. All she had to do was send them money up front for advertising, title searches and other administrative fees.

Nelson Robb gave up her credit card information. She didn't get a single offer. Not even a nibble.

"It took me a long time to realize how many crooks there are in the world. After a few thousand dollars, I finally woke up," said Nelson Robb, a retired AT&T worker. "They didn't do nothing but take my money."

A few months ago, Nelson Robb contacted authorities. She isn't alone.

Consumer complaints about the time-share resale industry in Florida nearly tripled last year, officials say, and have even surpassed mortgage fraud complaints. The Florida Attorney General's Office took in 2,719 complaints about the industry in 2009, up from 964 the year before.

"A lot of these scams we're seeing are not new, but with technology getting better and people's finances getting worse … it's kind of making a comeback now," said Doug Templeton, a senior investigator with the Pinellas County Department of Justice & Consumer Services. "It's hard to see it getting better."

In dozens of complaints reviewed by the St. Petersburg Times, a pattern emerged.

Victims from all over the country told state and local authorities that they were hooked by persistent phone calls and enticing deals from time-share resale companies offering to market their property.

Many times, the companies tell time-share owners that it will be no problem to find a buyer or renter within 90 to 120 days. They assure them that if anything goes wrong, they can have a refund. They promise the property will be heavily advertised. Then they get a credit card number and charge up-front fees of hundreds or thousands of dollars.

But many of the companies just put information about the property on a website with hundreds of other properties, which doesn't lead to any sales or leads.

For people like Jane Hoffman, the experience was eye-opening. In 2007, Hoffman, of Muncie, Pa., was contacted by Gold Crown Property, a Dunedin company that has since been subpoenaed by the Florida Attorney General's Office.

Hoffman, 69, said the company offered to advertise her Pennsylvania time-share for $601. She said the company told her that if she didn't receive three legitimate offers within a year, she would get 75 percent of her money back.

Time passed, and Hoffman never heard anything. When she contacted the company, employees told her she had some offers. But when she asked for proof, like names and phone numbers, they stopped responding, she said.

Investigators from the Pinellas County Justice & Consumer Services Department tried to mediate on Hoffman's behalf. After six months of back and forth, even they couldn't get the information out of the company. The complaint was closed with no compromise in July.

Hoffman still hasn't received a refund. Officials with Gold Crown Property declined to comment.

"You think you're going to sell something and then you get stung," Hoffman said. "It was just like a dead end."

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The problems in the time-share resale industry are starting to get more notice.

The Florida Attorney General's Office is investigating at least 17 such companies, including three in the Tampa Bay area, for deceptive trade practices. Two of them, Tampa's BUYATIMESHARE.COM and Largo's US Vacation, said they are cooperating with the state and expect to be vindicated.

But there could be other companies that aren't yet on authorities' radar, said Templeton.

He said the time-share resale companies seem to be getting more creative with their sales pitches as they compete with each other for customers, many of whom are seniors.

Kathleen Moran, who lives in New Jersey, said she was taken by a company called Eclipse Property Solutions in April 2008.

Moran, 77, said the St. Petersburg telemarketing company told her it could help her sell a piece of land she owned near Orlando.

It was a great time to sell, an Eclipse employee told her, and Moran could probably fetch about $40,000 in 90 days. All she had to do was send $875 via credit card.

Moran gave her information. She never heard from the company again. Whenever she called to ask how the search for a buyer was going, she got the runaround, she said.

Two years later, Moran's property sits unsold. She hasn't gotten a refund.

"He gave me a story, and I fell for it like a dope," she said. "What they did was put my property up on the Internet with 500 others."

In the past two years, Eclipse, incorporated in late 2007, has been the subject of 20 complaints with the county consumer protection agency, state Division of Consumer Services and the local Better Business Bureau. The state Attorney General's Office has not publicly identified the company as one it is investigating, however.

In February, the business also made the news when two employees were arrested in an identity theft scam. According to the Pinellas County Sheriff's Office, the men were eavesdropping on their co-workers' conversations, writing down customers' credit card numbers and using that information to charge up $30,000 in dinners, limos and other luxuries.

Peter Layton, the business' chief executive, said his company isn't trying to scam anyone, and pointed to its good rating (B-) with the BBB.

He said he realizes the industry gets a lot of complaints, but he said his business is legitimate. He said his company always deals with complaints in a satisfactory manner.

Public records show Layton, 39, has an arrest record that includes charges of criminal mischief, obstruction, harassment and drug possession. He most recently was arrested in December on a charge of attempting to purchase cocaine. Records show prosecutors elected to drop the case. Layton said he's a single father just trying to make a living.

"I'm not trying to rip anyone off," he said. "People complain because they have nothing else to do. We give refunds all the time."

• • •

Proving criminal fraud in the time-share resale industry can be tricky and frustrating, Templeton said.

Companies often will record only the portion of the phone call in which the person orally agrees to something, meaning there is no record of any deceptive sales pitch. Then they will send a written contract several days later. Many times, Templeton said, what people are really agreeing to is just an advertising contract.

When customers complain, Templeton said, companies are often quick to point them to shiny websites that list page after page of property listings, some with pictures and video. They also use the economic downturn as a cover for why things aren't selling.

But the current economic climate also has created a large pool of people who are eager to sell. They can be easy prey. Templeton said prosecutions can be difficult because many customers sign contracts that say they are paying simply for advertising, not the services they were promised in the pitch.

"I've heard plenty of stories where people were told the exact opposite of what was in the contract," Templeton said. "It's just whatever they can do to get the money."