A former employee of The Vacation Ownership Group LLC, was sentenced today to 36 months in prison and ordered to pay more than $3 million in restitution for conspiring to defraud owners of timeshare properties, U.S. Attorney Paul J. Fishman announced.
Eric Reilly, 34, of Galloway, New Jersey, previously pleaded guilty to an information charging him with one count of conspiracy to commit mail and wire fraud. Reilly entered his guilty plea before U.S. District Judge Noel L. Hillman, who also imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
The Vacation Ownership Group, a/k/a VO Group LLC, purported to offer owners of timeshares consulting services, including timeshare cancellation services. In September 2010, Reilly started working at the VO Group and was trained by VO Group managers to call using a prepared script and regularly lie to customers. Reilly would falsely state he was calling in response to a complaint they had made to timeshare developers and lenders. He gave customers the false impression that he was working for Wyndham Vacation Resorts, a developer of timeshare resorts. Reilly then would falsely represent that the VO Group could pay off the customers’ timeshares or have their timeshares cancelled. Reilly falsely told some customers that their credit would not be damaged if they stopped paying for their timeshares. Reilly gave some customers “references” who were actually VO Group employees posing as satisfied customers. After hearing Reilly’s false representations, some customers sent checks to the VO Group, including one customer who sent the VO Group a $31,385 check. Reilly admitted to causing more than $70,000 in losses.
In addition to the prison term, Judge Hillman sentenced Reilly to serve three years of supervised release and to pay $3,040,767.54 in restitution.
A reader submitted the following scam alert about a possible version of the Mexican timeshare tax scheme:
"... It's the Mexican tax scam. Mid-West Global Advisors contacted us with an offer to purchase stating they had a buyer. We were contacted by Continental Escrow Co. with the paperwork. They called us back saying Mexico required taxes to be paid. I said to take them out of the closing costs. He said that was impossible. We declined to continue the sale. .." Deborah K.
If you believe you have been victimized by this group, please report the crime at http://www.ic3.gov/default.aspx.
An Orange County
woman is facing a laundry list of charges after investigators said she helped run an unlicensed telemarketing business that scammed timeshare owners. Investigators with the Department of Agriculture said Jennifer Bacon and her partner, Carmen Rodriguez, both ran a company called RCIJB Worldwide Enterprise Inc. They allegedly scammed timeshare owners by claiming to have a buyer for their timeshare. The victims paid the requested fees, but their timeshares were never sold.
Bacon was arrested for a similar crime in 2012. Rodriguez was also charged for the previous scam and is currently serving time for it. Bacon was arrested Thursday and is being held on a $101,500 bond.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that Pasquale Pappalardo, 60, of Coral Springs, Florida, was sentenced today to 20 years in prison, with three years of supervised release, and was ordered to pay restitution in the amount of $1,061,401 and forfeiture of $3,500,000. Pappalardo was previously convicted in November 2013 in federal court in Fort Lauderdale of conspiracy to commit mail fraud and wire fraud, in violation of Title 18, United States Code, Section 1349, and conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956. Co-defendant Audwin Lovinsky, 35, of Tamarac, Florida, was also sentenced today to 33 months in prison and three years of supervised release and ordered to pay restitution in the amount of $34,635. Lovinsky was previously convicted of conspiracy to commit mail fraud and wire fraud, in violation of Title 18, United States Code, Section 1349.
In all, 41 defendants were charged for their involvement with a timeshare resale telemarketing room called Timeshare Mega Media and Marketing Group Inc. (TMMMG). The other defendants were charged in Case Nos. 11-60190-Cr-Cohn, 11-60247-Cr-Marra, 11-60268-Cr-Hurley, 12-60019-Cr-Scola, 13-60049-Cr-Dimitrouleas, 12-60149-Cr-Scola, 13-60154-Cr-Scola, and 13-60155-Cr-Dimitrouleas. Aside from the two defendants who were sentenced today, 37defendants previously pled guilty, one is awaiting trial, and one is deceased.
According to the evidence presented at trial, in February 2009, Pasquale Pappalardo, also known to the witnesses as “Patsy U’ Patso” and “Posh,” and Joseph Crapella, also known to witnesses as “Joey Cigars,” started a branch office of Time Share Market Pro (TMP), a timeshare resale business. The testimony at trial was that they knew each other from a previous stint in federal prison. In June 2009, at the direction of Pappalardo and Crapella, their associates took customer files and the electronic database of TMP, among other items, without the knowledge of the owner of TMP.
Pappalardo and Crapella then took the employees and the documents seized from TMP and formed a second timeshare resale company called TMMMG. In November 2009 and January 2010, TMMMG hired salesmen who worked for other fraudulent telemarketing resale companies, including defendant Lovinsky, who used the phone name of Edwin Lovins. Among the lies they would tell timeshare unit owners was that they had sold their timeshare units and that they needed to pay a refundable fee to secure the sale. The salesmen would then ask the timeshare unit owners for a fee of at least $1,996 and as much as $10,000. At no time were there any buyers for the timeshare units. The testimony at trial was that both Pappalardo and Crapella were told about the lies being told by the salesman, but Pappalardo and Crapella would not do anything to stop the salespeople from lying.
During the 10 months that TMMMG was in business, it fraudulently obtained approximately $5,000,000 from about 3,000 customers. Pappalardo received at least $300,000 in checks and hundreds of thousands of dollars in cash from the money sent by victims of TMMMG.
Mr. Ferrer commended the investigative efforts of the FBI. Mr. Ferrer would also like to recognize the assistance provided by the Fort Lauderdale Police Department, the Federal Trade Commission, and the Broward Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorney Jeffrey N. Kaplan.
Attorney General Chris Koster has issued a press release notifying consumers that he has filed a lawsuit against California-based Timeshare Relief, Inc., and its owner, David MacMillan, for numerous violations of Missouri's No Call laws.
According to the lawsuit, Timeshare Relief made hundreds of automated "robocalls" to Missourians on the No Call list, offering their services to assist the consumers in selling or transferring timeshares. The suit also alleges that the company ignored consumers' requests to stop calling, in further violation of Missouri's telemarketing
law. Koster's office claims to have received more than 100 complaints from Missouri consumers about the company's practices.
Koster is asking the court to prohibit the company from making any further solicitations to Missouri consumers. He is also seeking penalties of up to $5,000 per violation of the no call law, up to $1,000 per violation of the telemarketing law, and recovery of the costs of the investigation and prosecution of the case.
Consumers who believe they received harassing telephone solicitations are encouraged to file a complaint at (866) 289-9633.
Missourians can sign up for the No Call list at https://www.ago.mo.gov/nocall.php
link or by
The Better Business Bureau of Metro New York has issued a warning to consumers about a timeshare advertising business using the name "All Seasons Timeshares", which has been the subject of many consumer complaints. Follows is an excerpt from the warning:
"...All Seasons Timeshares reneged on the “100% Money Back Guarantee” for fees charged for a timeshare resale listing. Consumers reported signing contracts with All Seasons Timeshares to list their timeshares on the company’s website and to hire the company to help broker the sales, allegedly paying an upfront fee ranging from $300 - $1000. According to the complainants, the contracts they signed stipulated that if All Seasons
Timeshares was unable to sell their timeshares in the allotted timeframe, All Seasons Timeshares would refund the entire listing fee. Consumers say the terms of the guarantee required them to fax the company on the same day that the contract expired and request the money back.
In complaints, consumers state that their timeshares were not sold by the end of the guarantee period and they faxed the required notification to All Seasons Timeshares. The promised refunds were not issued and consumers say the company representatives stopped returning calls and/or emails. Mailed complaint notifications issued by the BBB came back as undeliverable by USPS and the website for All Seasons Timeshares was eventually shut down. BBB dispute resolution representatives left messages on the phone number for All Seasons Timeshares that were not returned. .."
Read the full alert by clicking HERE
More good news in the continuing fight against telemarketing fraud targeting timeshare owners!
Doris Heliin was sentenced to four and a half years in prison for her part in a telemarketing scheme that targeting timeshare owners and defrauded more than a million dollars from consumers with false promises of timeshare resales. She was also ordered to pay more than $500,000 in restitution to victims of the scam.
Co-defendent Joseph Heinz, who also pleaded guilty, was also sentenced to more than a year in prison and ordered to pay more than $70,000. in restitution.
The boiler room scheme used several aliases including Smart Choice Vacations, TMI Enterprises and Divine Vacations Group. Authorities clam that more than two hundred and fifty timeshare owners lost a total of $1.1 million after they were duped into sending payments for fake closing costs on timeshare sales that never materialized.
Authorities have charged a father and son team with taking part in a telemarketing scheme to defraud timeshare owners. Ronald and Michael Muise are facing charges of wire and mail fraud through a telemarketing business under the name "The Jariv Company". Other employees are also facing charges.
The Muises are accused of cold calling timeshare owners with the promise of a buyer for their unwanted vacation ownership property. The timeshare owners were coerced into paying large upfront fees, and were then unable to obtain a refund when the promised sale did not occur. Authorities believe the scheme defrauded consumers of more than seven million dollars over a five year period.
Read more by clicking HERE.
Another reader has submitted a timeshare scam report detailing a fraudulent timeshare resale transaction wherein the victim claims to have lost more than $3,000. in fake closing costs.
"... We were contacted with a sales price of $28,000.00 for our 1 br 1 bt timeshare condo. We have been approached once for $1,818.oo for closing costs. We were approached again for another $1,500.00 for additional costs. We sent both of these amounts. Now they have asked for an additional $1,500.00, which we have not sent. The man we talked to first was Jerry Clark and the one this time was John Fernandez. phone # of 1-619-906-7283..."
This another example of a common telemarketing scam where timeshare owners are enticed to send a large upfront fee by bank wire with the promise of an unrealistic sale price. Timeshare owners can protect themselves by simply taking the time to perform threee simple steps before paying any type of advance fee to sell their timeshare:
1) Call their timeshare resort for a referral to a legitimate closing agency or attorney, to obtain a realistic estimate of closing costs and transfer fees. In this particular case, the resort in question is located in Tennessee, and the actual cost for deed prep and recording through the attorney owned timeshare closing agency
PCS Title would only be $115.
2) Look for current timeshare sellers who are advertising the same resort for sale to get a rough idea of comparables on the market. For this particular resort, there are currently six ads showing on the timeshare classified website MyResortNetwork.com
which range in asking price from $1,000 to $2,550. These are asking prices- which means that they have not yet sold! An owner can simply ask themselves if the offer they received is reasonable.
3) If a timeshare owner has completed the two steps above and still believes the purchase offer is legitimate, the final step is always a sure way to weed out the con artists. The timeshare owner can simply offer to pay all the closing costs to a respected closing agency the timeshare owner chooses. This closing agency will then act as the escrow agent for the sale, ensuring that both parties are protected throughout the transaction.
It's unfortunate that this type of telemarketing fraud occurs, but these few simple steps will protect a timeshare owner from the majority of timeshare resale fraud.
A reader has submitted what he believes to be a timeshare rental scam perpetrated by a business using the name Julius M Vacation Timeshare Rentals, who offered vacation rentals at Casa del Mar Beach Resort in Aruba. The reader claims that he paid in full for reservations that have not been provided, and has been unable to obtain a refund. Follows is the warning sent in by the reader.
..."Julius M. Vacation Rentals ( Julius Martins) rented us 4 weeks in Aruba for timeshare rentals, and never supplied final confirmations for any of them, In fact he kept asking for more money just to finish the bookings, so he says. He is not willing to refund nothing and is a complete a rip off!"...
The reader also sent in a copy of the executed rental agreement. The document was professional in appearance, but did have a few flags that could have been a cause for concern:
1) The contract did not provide any specific information about the landlord other than the name Julius Martins.
2) The contract requested direct payment by electonic wire.
The only way a tenant can truly protect themselves from possible fraud is to insist on an independent escrow service. When an escrow company is used, the payment is held and protected by the third party service until after the tenant checks into the condo. If the landlord refuses to accept escrow, take your business elsewhere.
Many consumers mistakenly believe that payment by a transfer service such as PayPal, or payment by credit card provides protection to the renter. This is also false! PayPal does not provide buyer protection for any type of real estate transaction, and vacation rentals are classified as real estate. Also, for many rentals- the ocupancy date can easily exceed the window of opportunity to file a dispute of payment. Many credit card merchants will only allow a sixty or ninety day window to dispute payment. After that time frame, any requested dispute is automatically denied.