[2016] Huge upfront fee scam bust! Pro Timeshare Resales bilks owners of $15mil!

[TUGBrian]

http://protectingyourpocket.blog.pa...are-resellers-took-15-million-from-consumers/

this is such great holiday news! sounds like they froze the assets as well so some victims might have a chance at getting refunds!


(sad part is that these folks were first outed as scammers back in 2012 here on TUG)

 

[sts1732]

Thanks for the post Brian. Justice moves slowly but it's nice to know it does catch up, sooner or later.

 

[theo]

Good news indeed --- and very heartening. Thank you for providing that news item, Brian.
That's a whole lot of "customers" (the actual number is not actually disclosed in the article) to collectively "contribute" 15 million dollars!

It's great that the Feds have the wherewithal to freeze the assets of such thieving parasites. In an ideal word, the combination of criminal prosecution, fines and frozen assets would put a dagger through their thieving hearts and also serve to deter others from pursuing similar "enterprises".

I know, I know --- we don't actually live in that ideal world and there are (and will always be) other larcenous parasites to fill the void.
Just the same, it's wonderful to see at least some of these thieves get their comeuppance now and then.

 

[PamMo]

Hooray! It's heartening to see the Fed continues to go after resale scammers. Between criminal and civil charges that stick+hefty fines+jail time AND educating the public (kudos to you, TUGBrian, for plugging away on that front), I hope we'll see more and more scammers run out of business.

 

[Centurion]

The Florida AG has done an excellent job rounding these folks up. Freezing the assets was a strong strategic move. It eliminates the defendant's ability to finance their defense. It more or less seals their fate for right or for wrong.

 

[theo]

The Florida AG has done an excellent job rounding these folks up. Freezing the assets was a strong strategic move. It eliminates the defendant's ability to finance their defense. It more or less seals their fate for right or for wrong.

Say what, now???

If you read the story, this is a Federal case initiated by the Federal Trade Commission. Assets were frozen and a restraining order issued by a U.S. District Court.
In other words, there was no "Florida AG doing an excellent job rounding these folks up" in this matter at all.

 

[nhh]

Directly from the FTC.
https://www.ftc.gov/news-events/press-releases/2016/12/ftc-action-halts-timeshare-resale-scheme

At the FTC’s request, a federal court temporarily halted the operation and froze the defendants’ assets pending litigation. The agency seeks to permanently stop the allegedly illegal practices and return money to consumers.​

 

[TUGBrian]

looks like the FTC is seeking a 17m judgement against these folks....hopefully anyone on here scammed by them reported it and will get a piece!

https://www.law360.com/realestate/articles/977328/ftc-can-seek-refunds-in-17m-time-share-scheme-suit

 

[ronparise]

the scam outfits like this one absolutely deserve everything they get, but I cant help thinking its the timeshare developers themselves that make what they do possible

They sell an overpriced product using exaggeration and lies, often to people that cant afford it. They have created a group of folks that want nothing more than to get rid of their timeshares at any cost. Timeshare owners are perfect marks for the scam artists. Who better to take advantage of, than folks that have already been taken advantage of by the timeshare developers.

I think the FTC ought to take a close look at the sales tactics of the timeshare developers. What they do must be illegal

 

[brianfox]

They are a single weed in a forest, but it's good to see them get mowed down.

However, I have to wonder from which institution this reporter graduated:
"The defendants charge property owners as much as $2,500 or more..."

 

[DazedandConfused]

well, $15m divided by $3,000 is 5,000 people

It is hard to imagine 5,000 people falling for this scam

 

[T_R_Oglodyte]

well, $15m divided by $3,000 is 5,000 people

It is hard to imagine 5,000 people falling for this scam

not hard to imagine at all. Also, the average take is probably over $3000 per person. Usually, they keep coming back asking for more money to cover other fees that supposedly need to be paid. Based on reports, it's not uncommon for some people to pay more than twice that much money before they wise up.

 

[TUGBrian]

holy smokes, federal judge issues 18.7m in penalties!

https://www.law360.com/articles/1038904/ftc-nets-18-7m-win-in-suit-over-timeshare-resales


not that id imagine they would ever actually recover that, but this has to be one of the largest ive ever heard of!

 

[Passepartout]

This is the reason we've preached 'DON'T SIGN UP WITH UPFRONT FEE OUTFITS' for years. Glad to see someone is paying attention.

 

[brianfox]

holy smokes, federal judge issues 18.7m in penalties!

Great to see a large monetary penalty (that will never be paid).
However, I'd prefer to see the judge allow every plaintiff a baseball bat and 5 minutes time in a room with the defendants.
If a plaintiff is elderly give their strongest heir the bat and 10 minutes.
I think you would see a dramatic downturn in future fraudulent timeshare practices...

 

[TUGBrian]

id also prefer that the "fine" be added on to whatever jail sentence they got assuming they couldnt come up with the full 18.7m to pay back!

an extra day for every dollar owed works for me =)

 

[TUGBrian]

looks like the judge is seizing assets now! hope they leave these two broke and bankrupt for life!

http://www.orlandosentinel.com/busi...os-cfb-brinkmann-business-20180507-story.html

 

[mj2vacation]

id also prefer that the "fine" be added on to whatever jail sentence they got assuming they couldnt come up with the full 18.7m to pay back!

an extra day for every dollar owed works for me =)

If it only worked that way!

It’s sad that these people seem to pop up left and right. Enough people fall for it and get taken advantage of all over again.

It’s like the Sneetches from Dr Seuss.

 

[TUGBrian]

and as the wheels of justice turn slow....after this long we now see the owners going to prison!

Owners of timeshare resale company sentenced to federal prison for defrauding over 8,000 victims out of $18 million

Jess Kinmont and John P. Wenz, Jr. have been sentenced for operating a timeshare resale scam business that affected more than 8,000 victims nationwide, many of them elderly. The victims lost more than $18 million based on the defendants’ false promises that they could help timeshare owners sell...

www.justice.gov

 

[TUGBrian]

On October 12, 2023, Jess Kinmont, 57, of Port Orange, Florida, was sentenced by Chief Judge Timothy C. Batten, Sr. to seven years in prison to be followed by three years of supervised release and ordered to pay restitution in the amount of $11,699,376.60. The sentence was imposed following Kinmont’s guilty plea to wire fraud conspiracy on April 5, 2023.

On October 12, 2023, John P. Wenz Jr., 43, of Palm Coast, Florida, was sentenced by Chief Judge Timothy C. Batten to three years, 10 months in prison to be followed by three years of supervised release and ordered to pay restitution in the amount of $4,845,425.88. The sentence was imposed following Wenz’s guilty plea to wire fraud conspiracy on April 1, 2021.

This case was investigated by the Federal Bureau of Investigation with valuable assistance from the Federal Trade Commission. The FTC previously prosecuted a civil fraud case against the defendants in the U.S. District Court for the Middle District of Florida.

 

[LannyPC]

and as the wheels of justice turn slow....after this long we now see the owners going to prison!

But will any of the victims get any refunds or restitution?

 

[Fido Chuckwagon]

This would all be solved with a simple law/regulation: All timeshare HOA’s/developers must accept deedbacks (assuming no mortgage owed). If your resort is so cruddy that accepting deedbacks means the whole resort will fail/go into bankruptcy, then you deserve to fail / go into bankruptcy.

 

[geist1223]

No Sales Staff/Office can be within 1 mile of the timeshare.

 

[LannyPC]

This would all be solved with a simple law/regulation: All timeshare HOA’s/developers must accept deedbacks (assuming no mortgage owed). If your resort is so cruddy that accepting deedbacks means the whole resort will fail/go into bankruptcy, then you deserve to fail / go into bankruptcy.

Not necessarily. This topic has been discussed a number of times on these boards. With some resorts, the developer has long ago sold out and is long gone. Also, what if there is still a mortgage owing and the owner wants to surrender it back but the HOA refuses because there's a mortgage owing? Then there will likely be owners reaching out to these scam exit/cancel/relief companies who promise to get rid of everything including the mortgage. And even if HOAs/developers were required by law to take unwanted TSs back, that would not solve the problem or crime in which the aforementioned defendants were involved.

From what I understood from the article, the defendants were involved in the upfront fee resale/rental scam and not the exit/cancel/relief scam. With the rental/resale scam, the owners are not necessarily desperate to unload their TSs. They were just intrigued and overly excited about (supposedly) getting a huge payday for the sale or rental of their TS. These victims are generally delusional and/or ignorant about the realistic resale or rental value of their TS. I don't think forcing resorts, HOAs, and/or developers to take back unwanted TSs will protect owners who are naive about the resale value of their TSs.

 

[TUGBrian]

EVERY resort should offer at least ONE option for surrender of a paid off ownership.... that option could be unpleasant (like a multiple of your annual dues), but it would still be an option given to an owner to be out free and clear!

at this point resorts or systems that do not offer that are simply driving their owners to default themselves or get scammed and then default.