Scam Alerts!
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I just saw an indication in the local crime report of the Washington Township Times where it appears that con artists are now using a version of the fake Mexican timeshare tax to target timeshare buyers as well as timeshare sellers.
"...A Saw Mill Road resident told police on Jan. 5 he was defrauded of $1,750 through a time share company. The man told police he tried to purchase the time share from Condo Vacations and made a wire transfer of the money to pay for the taxes. However, all contact with the company ceased at that time and he was not able to retrieve his money...." Whether you are buying or selling a timeshare- there is no valid reason other than apathy for a consumer to not understand the importance of a proper and legal closing process. Good enough is only good enough until a problem comes along! There are numerous timeshare transactions that occur each day on classified sites such as eBay where the closing is being done by individuals who often are not legally able to prepare deeds or provide closing services. These invalid deeds can cause problems years down the road, possibly leaving the timeshare buyer or timeshare seller with no recourse other than spending thousands on legal proceedings to try and correct the problem. (Information below provided by PCS Title, a company that specializes in timeshare closings). Seventeen states and two US territories restrict preparation of deeds to licensed attorneys in that state, with a few exceptions noted below: Alabama Arkansas Florida Hawaii Indiana Kentucky Louisiana Maryland Mississippi New York North Carolina Ohioi Puerto Rico South Carolina Tennessee Texas Virginia Virgin Islands Wisconsin Most if not all allow a party to the deed, either buyer or seller, to prepare the deed unless in some cases they are a corporation. In Hawaii, however, if a party to the deed prepares it, to be legal the preparation has to actually be done in Hawaii, not somewhere else, and in Indiana only the seller, not the buyer, is allowed to prepare the deed. Wisconsin also allows a real estate broker licensed in that state to prepare a deed, and Florida allows title companies to do so if incident to issuance of a policy of title insurance. Lousiana and Puerto Rico, whose legal systems are based on continental European law rather than English Common Law, and for whom the office of Notary Public is much more responsible and requires far more education than in the other 49 states, also allow Notaries Public to prepare deeds. Before buying or selling any property, you must always perform your due diligence. Research and contact a respected closing agent who is properly licensed in the state where the property is located. Never allow the buyer or seller to either perform the closing themselves, or to choose an unknown or in-house closing agent. Always call the closing company to request proof of a true escrow account, and discover if they are affiliated with an attorney or a larger title provider. Call the timeshare management company or the HOA to determine if there are additional costs involved with the transfer such as a right of first refusal process, waiver fees, estoppels fees, or transfer fees. The State of Washington Department of Financial Institutions has issues a consumer scam alert warning about timeshare escrow scams involving two "companies" working in tandem called Ultimate Vacation Network and Premier Escrow Services.
Ultimate Vacation Network will contact timeshare owners with a very high offer to sell or rent their timeshare. The consumer is told that there is no upfront fee, but that a commission will be charged at closing. At this point, Premier Escrow Services is introduced as the escrow and closing company. It's important for consumers to know that Washington State law requires that “any person [engaging] in business as an escrow agent by performing escrows or any functions of the escrow agent” must be licensed by the Department. RCW 18.44.02. Consumers are then "required" to pay various fees to the closing agent, but the promised closing and seller funds never occur. Consumers who question why the funds cannot be taken from the proceeds at closing are often told that it is "against the law" to do so. This is not true.. A timeshare closing process is very similar to a residential closing, in that any seller fees or charges would simply be deducted from the seller proceeds. Read the Scam alert from the Washington State Department of Financial Institutions HERE. I was contacted by a respected closing company with a warning about another version of the Mexican tax scheme allegedly being conducted by a company calling itself Dallas Resale Group. Whether this is the same scammers reported earlier using the Austin Resale Brokers name, or just a copycat attempt at a timeshare scam is not clear at this time.
The scammers reportedly cold call timeshare owners who own timeshare resorts in Mexico, and present the seller with a purchase offer that is supposed to not require any type of upfront fee. Contracts are sent to the seller that appear to be very legitimate, other than the drastically inflated sale price being promised. However, when the "closing agent" gets involved- the hidden upfront fee is demanded! The seller is called and told that a new "tax" is now required for all Mexican timeshare sales that must be paid prior to closing. The seller is told that this "tax" cannot be taken from their sale proceeds, but instead they must wire the payment immediately or their sale will be canceled. If the seller sends in the fee- they never hear from the "closing agent" again and of course, never see a dime of the supposed sales price they were promised! If you own a timeshare property in Mexico and receive an offer to sell your timeshare, always take the time to properly research the closing costs and closing process so that you are protected from scams such as this. You can simply call your resort's owner services department and ask them to provide you with instructions and the cost required to transfer the ownership. Mexican timeshares are not deeded, so the transfer is actually done by the resort itself! As always- never pay any type of upfront fee to sell an unwanted timeshare! Regardless of what it is called- marketing fees, advance commission, or even Mexican transfer tax- simply say no and hang up the phone. In a true closing process, any seller fees that would be due would simply be taken from your proceeds at closing and would not require you to advance or wire money to the closing company or the reseller! Authorities Raid Alleged Timeshare Scam in Orlando, M&L Marketing Concepts and Maximum Properties2/15/2011
Local media is reporting that a potential timeshare scam was raided and shut down by a combined task force led by the members of the local Swat Team. Police officers raided the offices of M&L Marketing Concepts (also known as Maximum Properties) and issued warrants for Lisa Canada and Max Chilson. Other businesses near 7 South Magnolia Ave, Orlando, FL stood by in shock as a battering ram was used to knock down the door and swat team members rushed inside to secure the facility. The "company" web site has been shut down and reports state that bank accounts totaling $169,000 were seized.
This is the third such recent raid as a joint effort by the Department of Agriculture and Consumer Services, the Orlando Police Department, as well as the Florida Attorney General's office target timeshare resale scam operators across the state. Police said M&L Marketing Concepts and Maximum Properties were operated by the same group of individuals and have cheated hundreds of people all over the country out of at least $1 million over the last few months "It's a huge rip off!" said Barbara Jones of the Orlando Police Department. Investigators stated that the "businesses" obtained illegal owner's lists for timeshares at places like Disney, Wyndham and Westgate resorts, and called the owners with an offer to sell the properties for them. Police said they convinced the customers to send between $1,800 and $2,200 for non-existent closing costs, but instead the scammers simply pocketed the money and timeshares were never sold. I've gotten several emails warning about another version of the Mexican tax scheme allegedly being perpetrated by a company calling itself Austin Resale Brokers. They reportedly cold call timeshare owners who own timeshare resorts in Mexico, and present the seller with a purchase offer that is supposed to not require any type of upfront fee. Contracts are sent to the seller that appear to be very legitimate, other than the drastically inflated sale price being promised. However, when the "closing agent" gets involved- the other shoe drops and the hidden upfront fee is unveiled!
The seller is called and told that a new "tax" is now required for all Mexican timeshare sales that must be paid prior to closing. The seller is told that this "tax" cannot be taken from their sale proceeds, but instead they must wire the payment immediately or their sale will be canceled. If the seller sends in the fee- they never hear from the "closing agent" again and of course, never see a dime of the supposed sales price they were promised! If you own a timeshare property in Mexico and receive an offer to sell your timeshare, always take the time to properly research the closing costs and closing process so that you are protected from scams such as this. You can simply call your resort's owner services department and ask them to provide you with instructions and the cost required to transfer the ownership. Mexican timeshares are not deeded, so the transfer is actually done by the resort itself! As always- never pay any type of upfront fee to sell an unwanted timeshare! Regardless of what it is called- marketing fees, advance commission, or even Mexican transfer tax- simply say no and hang up the phone. In a true closing process, any seller fees that would be due would simply be taken from your proceeds at closing and would not require you to advance or wire money to the closing company or the reseller! *** eff (*******@aol.com)Tue, 01 Feb 2011 ......I was also contacted by this company and went through the identical situation of this original post. They did demand aprox $1500 to have my money released because of a Mexican tax. I won't bother to retype what was already stated here. THIS IS A SCAM! I believe this crew is now working under the name of AUSTIN RESALE BROKERS....... Margaret (******************@mahoganysolutions.com)Mon, 07 Feb 2011 I was also contacted out of the blue by Greg Evans of AUSTIN RESALE BROKERS. Although I only have three more years on my timeshare, they said they had a buyer for $12,900 and I needed to send a tax of $2,800. They didn't want the title transfer information, they didn't want the exact timeshare information - it had scam written all over it. Don't fall for it - no matter how enticing it sounds. They are not legitimate and need to be reported to the FBI....... Possible timeshare fraud alert: International Event Coordinators and Resort Escrow Exchange!12/3/2010
Reports are again surfacing that timeshare owners are being scammed in a timeshare rental or resale scheme involving these companies. Timeshare owners are being called with either rental or sale offers that are far higher than should be reasonably expected in the current market. Victims are told that they must agree to an "escrow fee" which is to be paid in advance to Resort Escrow Exchange in order to proceed with the transaction. Once the fee is paid, the transaction never closes and the consumer's payment is not refunded.
The original fraud alert from August with details on the scheme and these companies can be read HERE! As always, the best advice to avoid these types of scams is to never pay any type of upfront fee to sell or rent a timeshare property. In a traditional real estate transaction, the buyer is the party who provides a good faith deposit to open an escrow account with a legitimate closing company. Any seller escrow, transaction, or broker fees are then deducted from their proceeds at closing. The timeshare sale process should be very similar to a residential sale process. If you receive an offer and it requires you to submit a payment to a closing company you do not recognize, make sure you research the validity of the company in question- or simply refuse to do business until another closing agent is chosen. There are numerous well known title companies that offer escrow service for timeshare transactions, such as First American Title Company. |
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