Timeshare and holiday club fraud

Timeshares are a form of holiday ownership - you invest your money into the purchase of rights to spend time, usually a week or more, at a property such as a villa or holiday apartment each year. There are also timeshares or holiday clubs which offer the investor the opportunity to stay in a particular holiday resort or even a group of resorts, generally with on-site amenities including swimming pools, bars, restaurants and more.

Whilst timeshares are a legitimate sector of the travel industry, fraudsters seek to exploit the public in a number of ways;

Timeshare Resales:

Fraudsters try to take advantage of timeshare owners who want to sell their timeshare. They pretend to be a company who claim to have a buyer lined up who is ready to pay a good price to buy the timeshare. In return for finding the buyer, they ask for an upfront ‘introducers’ fee or other type of payment. They may also pretend to be the buyer at the same time as the company and use different contact details so the story is believable. In reality, the buyer doesn’t exist and it's another way to extract money from victims.

Timeshare exit & compensation fraud:

Timeshare owners are frequently approached by businesses purporting to offer services that enable them to relinquish or exit their timeshare contracts. In many cases, offers of ‘legal compensation' are also mentioned.

Recovery fraud:

A number of businesses have been closed down in recent years that have sold consumers membership schemes that claimed they provided discounts and benefits on holidays and timeshare or timeshare-related products, including fraudulent relinquishment and compensation services. Prior victims of these schemes may be contacted again as part of a recovery fraud scam.

Bogus or cloned law firms:

Fraudsters impersonate or clone well-known and reputable legal firms claiming to offer services to timeshare owners or prospective buyers. Before appointing or soliciting the services of a law firm for any timeshare related activity, consult the Timeshare Business Check website to ensure you avoid any cloned firms; https://timesharebusinesscheck.org/

Bogus leisure credits:

Fraudsters approach victims offering points, credits or vouchers which can be exchanged in return for holidays across a variety of destinations. They are marketed to give the illusion of choice or flexibility and may include other perks such as website or online shopping discounts. In reality the points or credits sold to the victim don’t exist. Once the money is sent all communication is severed. Occasionally fraudsters will also claim to offer a timeshare disposal service included within the package to entice those victims with an existing timeshare they wish to sell.

Bogus timeshare holiday bonuses and upgrades:

Fraudsters contact timeshare owners claiming to represent legitimate timeshare companies. They explain that the owner has been ‘awarded’ a bonus holiday which they can claim by paying an upfront administration fee. When they arrive on their bonus holiday they are taken to a resort where the owner is persuaded or pressured into upgrading their existing timeshare for an additional fee. They may also believe that they are selling their current timeshare as part of a part-exchange process. In reality the upgrades don’t exist and the fraudsters are simply after any additional fees they can extract from the victim.

Investment opportunities: Don’t be rushed into making an investment. Remember, legitimate organisations will never pressure you into investing on the spot.

You should treat investment opportunities with extreme caution if there’s:

• pressure to invest (eg time-limited offers)
• downplayed risk of losing your money
• promised returns that sound too good to be true

Seek advice first: Before making significant financial decisions, speak with trusted friends or family members, or seek professional independent advice.

FCA register: Use the Financial Conduct Authority’s (FCA) register to check if the company is regulated by the FCA. If you deal with a firm (or individual) that isn’t regulated, you may not be covered by the Financial Ombudsman Service (FOS) if things go wrong and you lose your money. For more information about how to invest safely, see the FCA's 'Protect yourself from scams' guide.

If you have made a payment: Inform your bank as soon as possible, they can help you prevent any further losses. Monitor your bank statements regularly for any unusual activity.

Identity theft: If you have shared personal or financial information, and suspect your identity may have been stolen, you can check your credit file quickly and easily online. You should do this every few months anyway, using a reputable service provider and follow up on any unexpected or suspicious results. You can also sign up for Cifas services which can help to protect you against fraud.

You could be targeted again: Fraudsters sometimes re-establish contact with previous victims claiming that they can help them recover lost money, this is just a secondary scam. Hang up on any callers that claim they can get your money back for you.

Check to see if the company in question is a member of RDO – https://wwww.rdo.org – the European trade body for timeshare. RDO requires its members to sign up to its code of conduct and operates a free of charge complaints handling service.

EUROC, the European representative for timeshare owners’ committees – www.euroc.org, whose mission is to help and support resort committees and to protect their owners, has also adopted a code of conduct to encourage best practice amongst its members.

If fraud has been committed, report it to Report Fraud.