Risk/Reward for scammers

[RX8]

Almost on a daily basis we see people post "I've been contacted by XYZ. They have a buyer for my timeshare and want to pay me $20,000" or "I've been scammed out of $1995 which was to Cover the title fees/taxes/appraisals."

There are SO MANY of these timeshare scammers taking good people's money that the risk must be very low for these criminals.

If I walked into a bank and gave them a note to hand over $2,000 my picture would be all over the local TV and they would give me a nice little name like "geezer bandit." There would be detectives involved and maybe even the FBI if I traveled across state lines. I would be caught within 24 hours. ALL OVER $2,000!

These scammers steal THOUSANDS and THOUSANDS of dollars from victims and I hear very little of these people getting caught going to jail. Maybe I am wrong but it appears that the authorities just don't do anything. Even with Florida making noise about Timeshare scammers I am sure that those numbers are minuscule compared to the volume of scammers.

 

[theo]

My $0.02 worth on comparing apples to oranges...

Almost on a daily basis we see people post "I've been contacted by XYZ. They have a buyer for my timeshare and want to pay me $20,000" or "I've been scammed out of $1995 which was to Cover the title fees/taxes/appraisals."

There are SO MANY of these timeshare scammers taking good people's money that the risk must be very low for these criminals.

If I walked into a bank and gave them a note to hand over $2,000 my picture would be all over the local TV and they would give me a nice little name like "geezer bandit." There would be detectives involved and maybe even the FBI if I traveled across state lines. I would be caught within 24 hours. ALL OVER $2,000!

These scammers steal THOUSANDS and THOUSANDS of dollars from victims and I hear very little of these people getting caught going to jail. Maybe I am wrong but it appears that the authorities just don't do anything. Even with Florida making noise about Timeshare scammers I am sure that those numbers are minuscule compared to the volume of scammers.

With all due respect, although I too greatly despise all of these assorted upfront fee parasites, I think that your bank analogy is a bit weak and your conclusion a bit flawed as well, for assorted different reasons:

1. In most instances, the collection of upfront "listing" fees, while certain to be completely unproductive, is rarely actually illegal (except in Florida, and there only since new legislation which became effective only as recently as July, 2009). Elsewhere, it's basically called a (completely legal) "listing and marketing" fee.
Some people apparently somehow choose to believe that a buyer has suddenly just appeared "out of thin air", not even asking to see a signed formal offer; I don't even know what to say about that. Collection of these "upfront fees" is certainly deceptive, despicable, misleading and opportunistic. Unfortunately, with the noteworthy exception of within Florida, those upfront fees are simply not illegal.

Outside FL, mere placement of a "listing" on some useless, obscure web site essentially fulfills the "marketing" component of a collected "upfront fee". In short, if it's not larceny or somehow otherwise unlawful, then it's not a crime in the first place (Florida has its' own pertinent statute for these parasites, created in mid-2009, but FL is thus far unique in this regard). Absent any actual commission of a crime, how / why would law enforcement authorities (...whether local, state or FBI) have any interest or involvement in consumers voluntarily choosing to make bad personal decisions with their own money?

2. These "upfront fee" scammers are also continually "on the move" (in several different respects).
For example, they periodically change their company name in order to "reinvent" themselves and create a "clean slate". The names attached to the voices on the phone are usually just phony, invented names to begin with. These parasites, far more often than not, use mail drops and /or P.O. Boxes for their "address". In short, they work quite hard at making themselves tough to find, regardless of whether or not their "business model" actually constitutes illegal activity (which it doesn't, far more often than not).

3. In regard to "the authorities not doing anything", I refer back to point #1 made above. In Florida, (Florida is where most, but certainly not all, of these maggots exist and operate) the AG office has investigated and prosecuted a fair number of these parasites in recent years; they continue to do so today. However (...back to point #1 above, paragraph 2), Florida alone has a specifically applicable statute which they can apply to these "upfront fee" parasites (...but the FL AG authority and jurisdiction obviously exists only within Florida).

Dr. Philip McGraw is fond of saying (in regard to people making bad personal choices, not in regard to unfortunate, innocent victims of actual crime): "There are no victims, only volunteers".
Frankly, when it comes to people freely choosing to voluntarily part with their hard-earned money to pay some obscure, completely unknown "upfront fee" marketing parasite, I'm inclined to agree...

 

[fishingguy]

hope, greed and being naive have a strong influence on things

I think Theo is 'dead on' in his post, and I feel the same way about these companies. But....

Florida has been the most aggressive of all states in this regard. It has strengthened it's laws and now requires a complete disclosure of what you actually get when you sign-up with one of these companies. If you read some of the T/C's now; you clearly see that most only commit only to advertising the TS, although it is typically buried amongst the other stuff you have to wade through. In addition, most now have a statement indicating that whatever you may have been told by the sales staff, it is superseded by the T/C's (null and voided). Because of that it has become even more difficult to prosecute the scammers.

Most people will gloss over the T/C's and never see this stuff, if they even read it at all. Some are so desperate to get out of their TS, believe what they are told in a cold call/sales meeting, or are wowed by the unbelievable price or prospect of a renter/buyer; that they just sign on the dotted line and hand over financial info. Along the way the seller may eventually feel that things sound too good to be true, have remorse and doubt -- often only doing more in-depth research after it is too late.

The #1 rule about anything you sign, is to read and understand what you are agreeing to; it's no different for TS. If something doesn't sound right then stop and do your homework; since the onus is on you to protect yourself! (Excellent quite from Dr. Philip McGraw by the way.)

 

[Knowitall]

Scammers (even when they are busted and prosecuted) keep coming back

Here's a perfect example that shows the penalties for fraud & theft (which is what most of these up-front companies really do) are not a sufficient deterrent:

A new up-frpont fee company has just started doing business-

Exclusive Corporate Marketing
www.ecorporatemarketing.com

The company has 2 previous names-
Resort Equity Marketing www.resortequitymarketing.com
American Resort Planners- www.arplanners.com

A quick search will tell you all about the Florida Attorney General's lawsuit against REM. Tuggers who have been around (as well as the moderators here on TUG) have probably heard of both companies.

They are now calling themselves Exclusive Corporate Marketing-

www.ecorporatemarketing.com.

Same owner (JOHNNY BRYANT)- same up-front fee- same scam

You gotta say one thing for these guys- they always keep coming back.

These guys run their company and squeeze all they can out of gullible timeshare owners....go our of business and the next day they are at it again under a new name.
Thanks-

Knowitall

 

[RX8]

Unfortunately, it's not necessarily illegal.

You raise some valid points but if it is not illegal then why do we occasionally hear about arrests for those scammers who claimed to have a non existent buyer, which seems to be the most common scam of all?

Maybe I am too used to regulated industries but I find it hard to believe that any business model that relies on lies, deceit, web sites with false testimonies, being completely unlicensed, misleading or outright false physical locations, and providing no meaningful consideration for the money they take in (for the "marketing/advertising" fee that is sometimes buried in their contract), can be operating within the law.

 

[theo]

Don't shoot the messenger...

...If it is not illegal then why do we occasionally hear about arrests for those scammers who claimed to have a non existent buyer, which seems to be the most common scam of all?

Maybe I am too used to regulated industries but I find it hard to believe that any business model that relies on lies, deceit, web sites with false testimonies, being completely unlicensed, misleading or outright false physical locations, and providing no meaningful consideration for the money they take in (for the "marketing/advertising" fee that is sometimes buried in their contract), can be operating within the law.

We periodically learn of such arrests simply because those particular parasites have managed to hit the "jackpot", by violating specific provision(s) of the pertinent (...invariably, Florida) statutes in a verifiable, documentable way --- and by doing so within the reach and jurisdiction of the Florida AG. It's that simple.
I don't believe that the oral "we have a buyer" assertion is what gains entry to the "jackpot", since that same assertion is never reflected in any contract paperwork anyhow. It's the upfront fee itself that wins the "jackpot" in FL, with or without the song and dance associated with the non-existent "buyer".

I don't like it any more than you do that these types of parasites are able (...for now) to continue their profitable existence, operating on the fringes and in the "grey" areas. We are a nation that exists and functions under the rule of law. In a modern, rapidly evolving society, sometimes voids or cracks in those laws develop (or are just discovered) that need to be addressed and filled. In the meantime, these types of parasites under discussion live (and thrive) within those cracks ---and they will continue to do so until the cracks are adequately addressed, filled and sealed.

Personally, I'd like to see Federal legislation addressing these parasites instead of relying upon 50 individual states to have to take their own independent baby steps forward. Others, on the other hand, would cry "government intrusion" or "over-regulation" in objection to that particular suggestion, or (understandably and justifiably) point out that our Congressional so-called "leaders" currently seem to be terminally unable and / or unwilling to even agree upon or address much more important business at hand on any given day.

 

[TUGBrian]

it is actually illegal in florida to collect an upfront fee prior to the sale of a timeshare.

"Section 721.20(6), Florida Statutes, prohibits the collection of any advance fee for the listing of any timeshare estate or timeshare license, and requires that any seller of a timeshare plan be a licensed real estate broker, broker associate or sales associate as defined in Section 475.01, Florida Statutes."

 

[e.bram]

Probably the best thing would be for the ARDA to develop a model code and encourage the states to adopt, like the BOCA code and the UCC.

 

[TUGBrian]

they have been developing that for the past 2 years...

 

[theo]

Exactamundo...

it is actually illegal in florida to collect an upfront fee prior to the sale of a timeshare.

Exactly my point in my (...admittedly long winded) replies to RX8 on "arrests and prosecutions".
However, in the big picture, we have to understand and acknowledge two important points here:

1. The FL statute has existed only since July of 2009 --- and it's jurisdiction applies only within Florida.

2. No such comparable timeshare statute exists in any of the other 49 states, to my knowledge.

 

[TUGBrian]

there are however existing real estate laws in nearly every state that to my knowledge, all cover Timeshares (with few exceptions)...this would certainly cover the upfront fee issue, as well as the fact that most of these companies pretending to have buyers acting as real estate agents/brokers...are not in fact licensed at all.

I do not believe there is an issue with the lack of laws to cover these scammers, its lack of enforcement. be it confusion as to who is actually responsible for pursuing these issues (even in florida you have the AG's office, DBPR, Dept of agriculture, FCC, yadda yadda)....and the fact that the criminals outnumber the law enforcement team by an unimaginable margin.

a good analogy would be speeding...sure cops can catch hundreds if not thousands a day, but in no way could they ever hope to stop speeding completely.

especially when the fines are so small compared to what these people bring in!

 

[theo]

I respectfully disagree...

there are however existing real estate laws in nearly every state that to my knowledge, all cover Timeshares (with few exceptions)...this would certainly cover the upfront fee issue, as well as the fact that most of these companies pretending to have buyers acting as real estate agents/brokers...are not in fact licensed at all....

Hi Brian:

As I understand it from others with far more legal expertise than I profess (or would ever pretend) to have, the legally protective wrinkle (outside FL, anyhow) for these "upfront fee" parasites is the "marketing fee" label and angle. In short, I do think that in most states outside FL, it is indeed a legislative (i.e., not an "enforcement" issue). The parasites can (and do) simply call their fee a "marketing or advertising" fee within the fine print of a carefully constructed contract, representing only that they will (for that fee) create some "valuable advertising" on behalf of the owner, in order to find a buyer for the owner. They are not actually representing themselves as selling anything other than advertising to and on behalf of the current owner, thereby apparently successfully "skirting" the applicability of real estate licensure laws. No one actually needs a real estate license to privately re-sell their own timeshare. People do it every day, here on TUG and elsewhere; on that particular point I'm sure that there is no disagreement at all.

I would certainly concur that the "upfront fee parasite" practices are skeevy, grey and clearly deceptive ---and that the obscure "advertising" they create is completely useless. That said, I don't believe or agree that (outside of Florida, anyhow) their "upfront advertising and marketing fee" practices are overtly unlawful or that existing real estate related laws are particularly (...if at all) applicable. In short, Florida created their new (2009) statute for a good and very obvious reason; like elsewhere, their existing statutes were clearly inadequate and / or simply inapplicable to successfully address and / or penalize these types of parasites.

I certainly don't claim to be the voice of omniscience, but the above is nonetheless what I firmly believe...