Fraudulent Travel Clubs / Deceptive Vacation Packages / Holiday Timeshare Traps
Be aware that when you place your business card or name into a drawing for a free vacation, you may be added to a telemarketing call list. Telemarketers know that wishful thinkers are susceptible to their offers. Also know that your personal information, should you enter it, may be collected by unscrupulous operators via the Internet when you are visiting bogus travel-related sites seeking unbelievable deals on trips or airfare.
Fly By Night Operations
You get a notice that you have won a super travel bargain. All you have to do is make a deposit with your credit card and select your preferred travel dates.
The trouble is you may never actually get your "bargain" trip because the travel proves to be a complete fabrication, your reservations may not be confirmed or because you must comply with so many hard-to-meet, hidden or expensive "conditions."
Fraudulent telemarketers purporting to be travel agencies can offer substantial travel packages at comparatively low cost because they know they will never have to come good on their promises. The use of travel as a commodity makes the long-distance nature of the transaction plausible but also makes getting a refund next to impossible.
Additional Costs and Upgrades
Several companies overstate the amenities included, hide extra charges in "all-inclusive" packages, or charge you for products and services you never received.
Free vacations often become assertively pitched "discount" packages, where you have to pay an excessively high price for some uncovered part - like hotel or airfare, or inflated charges for a "required" second person.
So, your airfare may be free, but your anticipated $50 hotel room costs you $350. Perhaps a "handling fee" or "membership fee", anywhere from $50 to hundreds of dollars, is required as well.
Some telemarketers say you've won —or been specially selected —for a trip then "bait and switch" you into spending additional money for "upgraded" hotel or other accommodations.
You get a free or low-cost trip, but the room is cramped and grimy, the food terrible or nonexistent. The promoter then magically finds an upgrade at an outrageous price.
In addition, many offers require you to pay upgrade costs to receive the actual destinations, cruises, or dates you were promised.
Some may require you to pay more for port charges, hotel taxes, or service fees but not bill your card until after you return.
They promise you a bargain-priced vacation. However, when you add up all the fees and extras, you wind up paying more for the "bargain" than for a conventional travel package.
The total cost may run two to three times more than what you'd expect to pay, or what you were led to believe. They may also fail to inform you of their "no refund" policy or misrepresent it over the phone.
Timeshare Sales Trap
You take the bait and fly to Florida. When you try to pick up the vouchers for the rest of your trip, you find yourself trapped at a lengthy spiel on timeshares.
You may also find out once you reach the final destination you are required to once again spend part of your vacation trapped listening to a lengthy and high pressure sales pitch for timeshare accommodations during your "vacation."
For more info on Timeshare Sales Presentations
Every year at spring break many students, who signed up and paid for vacation packages, are disappointed when no plane is available for the return flight.
When they examine the conditions of their contracts, they find, in small print, a clause that says the travel agency had the right to postpone the departure flight by as many as three days without any advance notice.
These students are left stranded in airports far from home, with no provisions for food or overnight lodging, just so the travel agency can save money, flying fewer of them during the off-peak days, once the break is over.
A lot of college students use use charters for spring break but these flights are not covered by the same laws as commercial airlines (usually charters can be canceled for any reason by the operator up until 10 days before the trip). Charter flights can also raise prices before the trip as well but you can cancel if they increase the package price by more than 10%.
Cruise Line Cancellations
Some travelers reserve a specific cruising date, sometimes a full year or year and a half in advance. Then, shortly before the cruise, they are told that that particular cruise has been rescheduled.
They are told that they can go on another one, on certain dates, which may not fit their work schedule. Most contracts say that a cruise line can cancel at any time, for basically any reason.
Boat Ride to Hell
Telemarketers can initiate contact with you in several ways:
|they may send direct mail to you stating you will receive a "fantasy cruise holiday" vacation including a "luxury" cruise, then direct you to call an 800 number; and|
|they also send unsolicited faxes to your business notifying "all staff" that the "wholesale travel department" has only a few Bahamas cruise packages remaining at a special corporate rate and that you should call immediately if you are interested in purchasing one;|
|they send electronic certificates to your e-mail address congratulating you on "winning" a fabulous vacation for a very attractive price. Some say you have been "specially selected" (only people with e-mail qualify) for this opportunity.|
As mentioned, leads are also gathered at local fairs and trade shows by "lead generators." Booths are decorated with banners or signs inviting people to "register" for a vacation. You register thinking you are entering a draw to win a vacation.
Regardless of the method of contact, you are led to believe you are part of a select group of people specially chosen to receive this vacation package.
Once they have you on the line, they describe an exciting vacation in Florida and a "luxury cruise" to the Bahamas. They state that the vacation is worth a significant amount, sometimes as much as $2,500, but that you will pay a much smaller amount to receive it, typically $398, $498, or $598.
They urge you to immediately "secure" or "register" the vacation with a major credit card. They also say that the payment covers the cost of your accommodations in both Florida and the Bahamas, as well as the Bahamas "cruise." They inform you that you must purchase the vacation immediately.
If you request time to think over the offer, or receive it in writing, they respond with canned rebuttals such as "this is a limited promotion based on availability" or , "each confirmation number can only be activated once, so you cannot call back and reactivate your number" or "by the time you receive something in the mail, the limited number of vacations will be gone." In fact, there is no limit to the number of such vacations for sale.
So you give your credit card number to the convincing operator. Once that is obtained, they say you will be switched over to a "supervisor." In actuality, the call is transferred to the "verification" department at their headquarters, where a third person comes on to the line to confirm details of the sale.
Unlike the sales portion of the call, the "verification" is tape recorded. During the verification, they ask for your credit card number again, quickly review the details of the vacation package and, in some but not all instances, tell you for the first time that you will have to pay additional charges for "port service reservation processing fees" and that the vacation package is "non-refundable." These disclosures occur only after you have provided a credit card number which will be charged within minutes of your hanging up.
In the travel certificate industry, the amount you are initially charged during the sales call is known as the "front end" fee. This is because you do not receive a vacation for the money initially charged to your credit card, nor does that front end fee pay for your vacation.
In fact, most, if not all of the front end fee pays the owners and their telemarketers for their sales efforts. For your initial $398, $498, or $598, you receive nothing more than a package containing a short video, some advertisements and a "reservation request voucher" for the Bahamas cruise and the Florida vacation.
When you receive the vacation package you discover that you will have to pay more to take the vacation you thought you had already paid for. You find you have actually just paid for the "option" to purchase a vacation and also realize that you did not win a thing.
The required additional payment, or the "back end" fee, is at least $198 to $316. They state that the back end fee is for "port reservation processing fees." In fact, the back end fee pays for most, if not all, of your "cruise" to the Bahamas and your vacation accommodations.
Should you call and attempt to cancel your vacation it is flatly stated that they have a "no refund" policy and that you cannot cancel your initial purchase. If you read the fine print on the back of the reservation vouchers that are included in their vacation packages, you will discover that they actually do have a return policy within a specified number of days, depending on the state in which you live.
If you return the vacation package, even following the instructions on the back of the reservation voucher, you inevitably receive your package back, often several times, until you either give up or call a law enforcement agency, the Better Business Bureau, your credit card company or a private attorney.
People who seek third party assistance generally receive a refund. Those who do not are generally stuck paying for the misrepresented vacation package.
Should you be one of those relatively few people who decide to pay the extra "back end" fee to take the vacation you will find that the vacation is not the "fantasy cruise holiday" you were promised but a five to six hour ferry ride to the Bahamas and back.
The cruise ship you're booked on may look more like a tug boat. The hotel accommodations they provide are shabby, and if you wish to stay at the better-known hotels and resorts referred to in the solicitations and brochures, you must pay yet more undisclosed "upgrade" fees; otherwise you must endure the substandard accommodations provided.
Never Never Land
You receive in the mail an "Executory Writ of Authorization" which certifies that you will receive a "World-class Florida / Caribbean Vacation Package . . . including all accommodations and two Round-trip Airfares!"
The certificate also states, "This special package is sponsored by, and designed to promote, select hotels, resorts and airlines."
The certificate displays hotel logos including those of the "Best Western British Colonial Beach Resort" and the "Nassau Marriott." To receive your vacation package, you must call right away.
When you call their 800 number you reach a telemarketer who reiterates that you will receive a "promotionally discounted vacation package." They say they can offer such a "fabulous vacation" at an extremely discounted rate because they purchase large volumes of rooms from the specified hotels which, in turn, are promoting tourism in Florida and the Bahamas.
They say you are guaranteed to stay at the British Colonial Beach Resort in Nassau, Bahamas and that the vacation package is valid for 18 months, but that your reservations must be made at least 60 days in advance of the requested travel date. They indicate that they are a full-service travel agency and that they are the ones to call to book your reservation dates.
This special limited time offer will cost you only $495 which you must pay immediately with your credit card. Through the use of stall tactics and blackout dates they either manage to have the offer lapse or they have disappeared completely by the time you decide to book.
Travel Club and Vacation Package Offer Tips:
|Buy vacation travel from a business you know. Deal with members of a professional association and realize that few legitimate businesses can afford to give away products and services of real value or substantially undercut other companies prices.|
|Verify arrangements before you pay. Get the details of your vacation in writing and a copy of the cancellation and refund policies. Don't accept vague terms such as "major hotels" or "luxury cruise ships." Call to verify your reservations. Look up numbers rather than using those provided. The entire operation may just be a front using mail drops and call forwarding services, all leading back to the same operation.|
|Learn the vocabulary. "You have been specially selected to receive our SPECTACULAR LUXURY DREAM VACATION offer" doesn't mean you'll get a free vacation. It means you'll be "offered an opportunity" to pay for a trip that may fit your idea of luxury or not. "Subject to availability" means you may not be able to get the accommodations you want when you want them. "Blackout periods" are blocks of dates, usually around holidays or peak season, when no discount travel is available.|
|Don't send money by messenger or overnight mail. Some scam artists may ask you to send them a check or money order immediately. Others may offer to send a messenger to pick up your payment. If you pay with cash or a check, rather than a credit card, you may lose your right to dispute fraudulent charges.|
Subject: RPR Vacations
Date: 26 Aug 2001
Help! We think we have fallen victim to this scam.
Our trip isn't scheduled 'til the end of Oct. this year, but the more we see & hear the more disappointed we are becoming.
First it's approx. $700.00 for the first person, then it's $700.00 for the companion - if you don't want a sub-compact car or an inside cabin on what sounds like the 'hell cruise' it's another $269......
Do you know of a way to get out without substantial penalty? Are there any class action suits pending? Thanks for your great web site - wish we would have looked at it sooner.
Reply: Suggested search at the FTC site and the search box at page bottom for up to date info on suits.
Big Ships Stop Slowly
I happen to have been foolish enough to be taken in by Ramada Plaza Resorts and was given their website while on the phone with the telemarketer, though I did not access the site until after I had hung up.
I had to use a search engine to find their site and, lo and behold, there was your warning in big bold letters. I immediately called my credit card company and they advised me to call the RPR ORGANIZATION and cancel, which I did.
They told me they would honor my request, but yesterday, three weeks after the cancellation, I received the video package in the mail and my credit card company still shows there has been no refund. What do I do now?Shirl Teaney 11/30/01
We have a company that has just come to Dallas named GreatEscapes Travel Club based out of Lakeland Florida. It is almost exactly as you describe in your section titled "Clubbed on the Head."
I too was taken in by what originally was to be a 90 minute presentation that became a 3 hour sales pitch. I was promised the Guaranteed Lowest price on travel and 5 percent back in "travelbucks" to use towards other vacations. I asked the salesman what types of travel and he said "everything".
Reading the contract at home I find that the "travelbucks' could only be used for certain items and the fine print suggested that they had totally misrepresented themselves. I stopped payment on my check the next day then faxed and sent them a certified letter demanding they return it to me and to cancel my contract as I have not received any goods or services from them.
I have not heard from them yet nor have they cashed my check. My attorney says the contract I signed did not conform to State of Texas law in regards to certain items be written in bold or underlined print and says he hopes "GreatESCAPES" attempts to sue. Have you heard anything about this company?
Bart Terrell 01/25/01
We Sell Dreams, Not Nightmares
I have been selling timeshare vacation packages for about three years and although I enjoyed your site, I was upset with the bad wrap you gave the vacation package business. It's extremely upsetting how a couple rotten apples can ruin the entire barrel.
I'm sure there are a lot of fraudulent telemarketing companies who misrepresent the packages and terms & conditions of the vacation, but I am proud to say that I have one of the cleanest and most respectful telemarketing companies in Tampa. ( no name given )You must understand that a lot of these discounted packages are impressively good deals made possible by the fulfillment and timeshare industry. These vacations may not value at "$2,500", but for a person to put a similar package together themselves would cost a good $1000, whereas a customer of mine can purchase it for $398.
Although there is some truth to your article on fraudulent vacation packages, understand that there are many reputable companies who have been providing their clients with awesome vacation packages and that there are many positive experiences from people who have taken them.
Bottom line: The world evolves around business. This is a business based on selling people something that will make them feel better about themselves. Selling a dream. What better dream than a "fabulous vacation".
Jason Martinez 01/11/02
While I value your opinion and even admit that many people actually sign up for vacation values knowing they must sit through a timeshare presentation, few actually are prepared for the high pressure inherent in the industry. Timeshares, while predominantly legitimate, are by their nature a poor investment in the majority of cases.
The scams I try to focus on are the ones where the value of an offer are grossly exaggerated and misrepresented in order to deceive. Few people seem to arrive at these offers aware of their future dissatisfaction.
I am glad you work within the boundaries of goodwill, make people aware of their obligations, and do not have add-on charges which negate any value of advertised promises. My research is taken from numerous cases of infractions which have set a track-able and unstopping trend.
All Vacation Packages Sound Good
I was looking for information on your great website to see if Ramada Plaza Resort Vacations was a scam. I gave them $349USD on Dec 21/01 by Visa which works out to approximately $600.00 Canadian.
I had given their
package and video to my husband for our 25th wedding anniversary
and promised to take our three sons along. Now I still
need to send them $1550USD to fulfill the cost, but after
reading your info, I just want to see what I can do to get
my money back.
I have to admit that I must be quite gullible. I fell for a scam last year called, Skybiz. I paid $100.00 US to get a website instructional program that was totally useless. I joined on the advice of a friend and with the promise of making money.
Right now I am also trying to get back some money from a company called, Underdoz.com (and underdogz) They offered cheap airline tickets yet I never received anything after six months for my $148CDN and I just found out that they closed on December 31, 2001.
Pamela Funk 01/24/02
Note: the site was active when I visited 01/25/02
Vacation Package Call Center Job Jitters
Last month I lost my call center job after I discovered their dishonest methods.
When I started the job I was told that I was to sell a vacation package to people who called in about winning a $1002 credit voucher on a vacation package which supposedly normally retails for $1400.
Basically, the people calling would then be told they could get a package containing seven vacations, one major and six mini vacations, for only $398.00 for two people.
When I saw this great deal I wanted to get one myself, but because I knew someone who was fooled with the Ramada resort travel package, one of my co-workers and I decided to look for them on the Better Business Bureau website first. Oddly, there was no report available despite their claiming to be a member.
Two days later I asked to see details of the package I was selling but they refused my request, stating that they only had one copy and wouldn't want to lose it.
The next day, after nagging my supervisor, he finally agreed to let me go through the package but then only showed me a bunch of pictures. Though unable to prove fraud, I suspect the worst.
Now, after being fired for being too inquisitive, I really feel bad about losing a job but I want to make people understand that, at least where I was working, a lot of the staff were unaware that it was actually a scam that they were selling.
03/00 - In an FTC settlement, Frederick F. Zeigler III, Robert E. Kane, Commonwealth Marketing Group, Inc. and Great Escape Vacations & Tours, Inc.; will be required to pay $145,000 in consumer redress, $18,500 in receiver's fees and expenses, will be enjoined from any future violations and post performance bonds of up to $150,000 before either selling travel-related services or conducting telemarketing activities.
Through the use of direct mail vacation "certificates" and outbound telemarketing calls to people who, believing they were entering a drawing for a free vacation, had previously submitted "registration forms" handed out at events such as county fairs, they representedthat consumers had won a "fantasy cruise holiday" to Florida and the Bahamas, when, in fact, they had won nothing.
They actually had to pay a "promotional fee" of $598 per couple, and up to $300 or more in additional charges when they were ready to travel. In addition, the vacation packages received did not provide the "luxury" accommodations promised unless consumers paid yet more money in "upgrade" fees.
Upon calling the consumers, CMG's telemarketer described an exciting vacation to Florida and "luxury cruise" to the Bahamas, concluding the pitch by offering the complete package for a small "promotional fee" of $598.
Consumers were instructed to secure their vacation using a major credit card. Only after consumers gave their credit card numbers were they told that the package was nonrefundable and that in some, but not all, cases they would have to pay additional fees - often mischaracterized as "port fees" - when making their reservations.
When consumers received their packages, according to the Commission's complaint, they found that they had to pay more money for a vacation they believed was already paid for in full, and that they had, in fact, won nothing at all.
Many consumers were told their purchase was nonrefundable. In fact, while CMG did have a written return policy for the vacation packages, the company allegedly did not honor it, and consumers who returned their packages often had them mailed back several times.
Severing Ties With Tijuana
On scams like the Mexican Vacation Club, or others where the consumer uses a credit card for time payments, I often tell consumers to destroy their cards, report their cards stolen, etc. Do anything you need to in order to close that account.
I sometimes tell them to not accept the card company's offer of a replacement card, just to put more distance between you and the scammer. Reporting the card lost or stolen may be dishonest, but in this case, turnaround is fair play.
Be sure to make good on your other debts or stop using the card for 10 days before you do this.
I have never had a consumer report back to me that the business is actually legitimate and that it is pursuing the "debt." You may get a dunning letter from a "letter service" collection agency (as opposed to a real collection agency). The Mexican Vacation Club contracts usually list jurisdiction in Mexico City, and I've never seen them file a suit there against a U.S. or Canadian consumer.
Consumer Attorney in Seattle. 04/02
Have you heard of Dreamquest Communications which says you tour Ramada Plaza for an hour and get to stay at a Ramada in Orlando for 3 nights for $228.00? They offer some free Disney tickets but they want a bank check payment right away. Anon 05/06/02
04/02 - Vermont's Attorney General filed a consumer fraud lawsuit against Cape Canaveral, Florida based Cape Canaveral Tour & Travel, Inc. and two of its employees, Lory Walker and Michael Dwyer.
According to the complaint, Cape Canaveral contacted Vermont consumers by telephone to sell them seven-night vacation packages to the Bahamas and/or Florida, typically consisting of hotel accommodations, a rental car and travel on a cruise ship that, not including air fare, cost $1,155 and involved a time-share tour.
The complaint alleges that they violated Vermont’s Consumer Fraud Act by:
|through their agents, soliciting consumers to fill out entry forms at fairs on the pretext that this would entitle the consumer to participate in a giveaway or drawing, whereas in fact the purpose of the entry forms was to generate "leads" for Cape Canaveral.|
|failing to disclose, at fairs, that a purchase was required.|
|misrepresenting the company’s vacation package offer as a special offer and highly discounted, when in fact the offer was ongoing and was figured from hotel "rack rates" that consumers could easily obtain at a discount from a local travel agent.|
|failing to disclose that consumers had to take a time-share tour in order to take advantage of the vacation package offer.|
|failing to afford Vermont consumers their right to cancel the telephonic purchase of a vacation package within three days.|
A court order requiring the defendants to comply with Vermont law, refunds for Vermont consumers, civil penalties of up to $10,000 per violation, and other legal relief is being sought.
Diamond Holidays Travel called me to let
me know I won a cruise including 4 nights and 3 days in the
Bahamas with hotel, but I have to send them a check for $77.00
for me and the second person plus port charges of $99.00
a person.I have four days to call them back. Is
this a scam?
One spammer offering vacations in both English and Spanish formats and which are accompanied by timeshare presentations is Valued Guest at www.valuedresorts.net
See also: TimeShareBeat's Vacation Club Scams.
Have you ever heard of Sundance Vacations out of Pa?. Their deal started at $10,000 for 20 vacations which included excess inventory and other enticements but I kept saying no.
Final deal, $5000, unlimited vacations, excess inventory plus. Seemed too good to be true. Walked out. Hope I receive the free weekend which was the come-on.
Live Wire Shorted Out
10/24/02 Illinois Attorney General Jim Ryan filed suit against Live Wire Systems, 2425 Commercial Boulevard, Suite 400, Fort Lauderdale, and James P. Davis with violating the Automatic Telephone Dialers Act, Uniform Deceptive Trade Practices Act and the Consumer Fraud and Deceptive Business Practices Act.
The defendants are charged with placing more than 10,000 autodialer marketing calls since at least July 2002 to individuals and businesses across Illinois using prerecorded messages that invited consumers to purchase low-cost Disney vacation packages.
To confirm their invitations, consumers were instructed to call a toll-free number that provided the details and conditions of the trips.
The lawsuit alleges that they misrepresented the nature of the offer by failing to disclose that consumers are required to tour timeshare resorts as part of the package and that Walt Disney Company is not a sponsor of the trip and has not approved use of their name.
In the suit, Ryan is seeking a permanent injunction, restitution to consumers, costs, a civil penalty of $50,000 and an additional penalty of $50,000 for each act committed with intent to defraud.
Vacation Club Telemarketing Sales Script from Diamond Prize Center - pdf