Non-existent Maintenance Fee Elimination Programs Jeopardize Security Clearances – Report 4 of 6

Report 1 of 6: Active Duty Navy, Chief Petty Officer, 14 years served

https://afterinsidetimeshare.com/?p=1098

Report 2: Marine Veteran, 26 years served, security clearance

https://afterinsidetimeshare.com/?p=1115

Report 3: Active Duty Navy, 12 years served

https://afterinsidetimeshare.com/?p=1151

Report 4: Active Duty Navy, 18 years served

The four most common timeshare complaints reported, tracking over 2,000 complaints:

1. We were told that the timeshare would be easy to rent to offset costs,
2. We were told that maintenance fees could be eliminated,
3. We were told our timeshare has equity when there is no resale value.
4. We were told our heirs would be forced to inherit our timeshare.

Today’s active duty service member reported that he was told by his Diamond Resorts sales agent and a manager that his maintenance fees could be reduced by half if he purchased additional points. Without a recording, reports are considered allegations. After Inside Timeshare received six additional reports about the manager from other Diamond Resort members.

When fees increase, instead of decreasing, or renting for profit doesn’t work, the purchaser is often left with no choice but to default. It is next to impossible to sell a timeshare with an outstanding loan, financed at between 12% to 19%. A default can jeopardize a security clearance and may result in involuntary separation from service.

Diamond Resorts contacted me about attending an orientation after my wife and I purchased 7,500  bi-annual **U.S. Collection** points on September 26, 2019, in Virginia Beach. We had accepted a promotional invitation. The purchase price was $16,650. We financed $13,678. Before attending the orientation in Las Vegas, in December of 2019, I reviewed our contract and realized our points were “every-other-year” points. Our sales agents had told us that we could take up to three weeks of vacation every year.

I complained to the agents, and their manager, about our points, being every other year. They informed us that the Virginia agents lied to us. They suggested we trade in our bi-annual points for 15,000 annual points. The annual maintenance fees were estimated to be $3,000. I explained that we could only afford $1,500 a year. Manager M said that we could offset 50% of our annual maintenance fees by charging purchases to a Diamond Barclay Credit Card. He opened a card for us while we were there.

I do not remember being given a copy of the contract, but I found out we paid $36,034.86. We financed about $30,000 at 16% and charged a $4,000 down payment to the Barclay credit card, believing the charge would offset about half of our maintenance fees. We signed the contract electronically. The mortgage lady and the manager said they would mail us our documents. We never received them.

The manager did not go into specifics as to how the Barclay credit card would offset half our fees. We told everyone we spoke to, including our mortgage lady, that we could only afford $1,500 a year. The signing was recorded. That should be on it.

After paying off the $4,000 down payment, I called Barclays to ask about paying fees. The Barclays rep said that what I had been told was not how it works. I had a breakdown and hung up the phone. We are a single-income family of six and I will be deployed this year. Our youngest son has special needs. He has developmental delays and a sensory processing disorder.

We learned you can only offset 1% of maintenance fees by charging to the Barclay card. I spoke to a Diamond executive who said the Barclay card may or may not have been explained in its entirety, and that the recording made at closing was “up for interpretation.” I was not allowed to listen to the recording.

I stopped loan payments. Since Diamond would not help us, I contacted Reed Hein & Associates and paid them $10,272.48. I was informed that Diamond proposed settling our case for $16,017.43, half of what we owed, but I declined. I would have to borrow the money. I know I could put my military career at risk, but what happened to us is wrong.

To say this has been a nightmare is an understatement.  I know we were tricked. The manager said he served in the Navy.

Six additional complaints reported about the same manager, highlighted in red are comments about maintenance fee reduction 

#1 Retired Navy, 21 years active duty, age 69, California (resolved)

Sales agent TW (10 complaints reported)

April 5, 2019

Michael Flaskey, CEO, ARDA, ARDA ROC, Barclays Bank

We attended a Diamond presentation at a Marriott hotel in January of 2018. Our representative said it would be better if we were Platinum members because we could use points to pay maintenance fees. We did not have the resources to upgrade.

We received a call stating that we needed to come to an update at the Hard Rock Hotel at Lake Tahoe, Nevada. We attended in September of 2018. T W went over our account and stated that we were only temporary Platinum and needed to be true Platinum to use points to pay maintenance fees, but explained this benefit was not yet available. We didn’t have the money. They said we might qualify for a  Barclays MasterCard. We did. They said using the credit card would earn points to pay maintenance fees. T W said he would assist me. He gave me his cell number and said to call him towards the end of the year. He never returned calls, texts, or emails.

We purchased 16,000 points for $48,000, financing $53,976 at 12.73%.

Paying maintenance fees with points covers only a small part of the maintenance fees, and using Barclay Rewards points even less. Since the ability to pay maintenance fees with points was not yet available, it would not have been in the contract. Maintenance fees are invoiced at the end of the year, delaying a complaint until the year’s end.

Complaint #2 A D,  F C,  California

Sales agent M G (6 complaints reported)

August 2019

To Michael Flaskey, CEO, Hospitality, ARDA, ARDA ROC, Barclays Bank, Association of Vacation Owners, Securities and Exchange commission

We purchased 6,500 points in Las Vegas in October of 2018  from M G for $26,260. She said she was not selling points. Our meeting was an update. M insisted we open a Barclay card, explaining that we could pay our maintenance fees by charging to the Barclay card. She did not explain this was only pennies on the dollar. We explained that we had a daughter starting college so could not afford this. The manager said we could get a tax deduction for the mortgage payment.

Not yet knowing that programs to substantially reduce maintenance fees don’t exist, we purchased a third time in December 2018 at Lake Tahoe Nevada from M M.  We purchased 6,000 points for $24,240, financing $22,491.

M M said sales was not his department. “I work in Finance where I help families refinance loans, but I will help you guys since the sales agent that was supposed to help you is not here,” M said if we purchased an additional 6,000 points we would combine the new points with our prior 6,500 points. He held up a copy of our prior contract and said, “By purchasing these points, this is gone.” That did not happen.

M M said we could use half our points to pay maintenance fees and a half to travel. He assured us that he would qualify us to refinance our loan at 5% after making 6 payments. M spoke with his manager Matthew, who approved the refinancing.

M’s exact words were, “When you sign don’t say anything because they don’t like me helping people like this.” He stood by me throughout the signing session.

Complaint #3 (foreclosed) Wil and Marianne, foster parents, California 

Sales agent, R S (9 Complaints)

July 2019

To Michael Flaskey, CEO, ARDA ROC, NV Real Estate Division, Principal Broker Jean Paul Hendrick, sales agent R S, Association of Vacation Owners

We upgraded in 2018 in Las Vegas with R S and Matthew. We were struggling financially. We had heard about Diamond’s voluntary surrender program, Transitions. R said we had to be Platinum to be eligible. R showed us numbers of how much Diamond would pay us for our points if we upgraded. We said we couldn’t afford to upgrade. We could barely afford to pay maintenance fees. He said, “What’s another $300 more on your loan payment? That isn’t too much to be eligible for the Transitions program.”

This purchase resulted in an accumulated loan balance of $80,117.99. R said to make a few loan payments before applying for Transitions. We did, then applied, but were denied because of the outstanding loan. We hadn’t needed to buy any additional points to be eligible for Transitions. We had said over and over that we don’t make much money. I’m a stay-at-home mom who takes care of foster children and my own children. We believed we were signing a contract in good faith.  Marianne

Compliant #4 R S, Washington

QA agent, SM (4 complaints)

Sales agent FA (5 complaints)

July 2019

To, Hospitality, Michael Flaskey, CEO, Charles Zehren, Rubenstein strategic communications & reputation management, Apollo Global Management,  Barclays Bank, Hawaii Attorney General,   ARDA ROC, ARDA, Association of Vacation Owners

ARDA Code of Ethics Violation, Nevada Real Estate Division Complaint against F A

Nevada Real Estate Division Complaint against Jean-Paul Hendricks, Principal Broker

At Ka’anapali Beach Club in August 2016, the agents said we should switch back to Hawaii points because they are more valuable. The cost was $14,000+. We didn’t do it.

In May 2018, we met with sales agent F A – and Matthew – Sales Manager, and S M Quality Assurance Representative. F A told us we should have been invited to an Apollo event to explain changes happening and to give us a special price because of Apollo acquiring Diamond. F said things were different now. Deceitful agents had been fired. Apollo listened to complaints and developed two new programs:

1. Diamond would buy back unused points at $.30 per point
2. Owners would be able to list points for sale on a Diamond operated website. The transaction would be private and after paying a transfer fee, the real estate transaction would be completed and filed by Diamond.

We were sceptical so asked to speak to a manager. Matt confirmed every detail. The ONLY reason we agreed to purchase was to obtain the new features. F repeatedly told us that the number one complaint was the loss of points. He explained the new programs in detail on paper but refused to provide us with a copy of his notes. We bought 15,000 points to be Gold members for $52,800 for reasons that did not exist.

Diamond Hospitality Management, Keisha White responded to a letter we sent approximately two weeks later stating in a phone call, “You signed a contract. Diamond Resorts expects its members to live up to the terms.” She assured me that Diamond Sales Agents are well trained and would never misrepresent products.

December 2019

Email To Jason Gamel, ARDA President

Kenneth McKelvey, ARDA-ROC Chairman

Greg Crist, Association of Vacation Owners

Diamond Resort denied my request to cancel our contract due to misrepresentations. ARDA-ROC say that they are our advocates. I will be filing a complaint with the Arizona Attorney General because the closing session should not be allowed to be recorded if the sales session cannot be recorded.

Complaint #5, M D, 64, D D, 68, Massachusetts, former Platinum members

AE (recorded making a fraudulent sale, 3 complaints)

ML (6 complaints)

EGJ (5 complaints, in VA a member forwarded pictures of decaying Hawaii air-conditioners EGJ showed her as a reason to switch out of HI points)

To Hospitality, Michael Flaskey, CEO, ARDA ROC, Association of Vacation Owners, Nevada, Hawaii, Florida Attorney General

April 3, 2020

Our Diamond nightmare involves Nevada, Hawaii and Florida transactions. In Hawaii, we purchased 8,500 points in October of 2017 switching the U.S. Collection points to Hawaii points. We were told that there is only so much real estate in Hawaii so Hawaii points will be worth much more when or if we need to sell.

In September of 2018 at Lake Tahoe, we purchased 17,000 points from A M and Matthew. We were told we could cover maintenance fees with points at $.30 per point. Matthew said it was a “no brainer” because after 10 years we would save $50,000.

We next met with A E and M L. A wrote out how if we turned in 50,000 points we could get a $15,000 credit at $.30 per point.  He explained that if we turned in 25,000 points at $.30 a point ($7,500) we could pay all our maintenance fees and still have 25,000 points left to travel. He explained that the last contract we purchased was wrong and needed to be cancelled to put us on the right track. He quoted us $132,000 in equity stating he would use $32,000 to pay for additional points. In Hawaii, and at other updates, we were told points could be sold for more than what we paid.

A stated that with the 30/30 Club we could pay for our maintenance fees. He said he would set up the 25,000 point credit at $.30 a point automatically, but we could change it if we wanted to go on a big trip that would require all our annual points.

In Orlando, E G J said her maintenance fees are $8,000, but she only pays $3,500. She said she would show us how to use a VISA gift card to pay fees. She told us we had equity of $116,280. A said we had $132,000 in equity.

There is no program to pay maintenance fees at $.30 per point. Equity is not like home equity. There is no resale value. Diamond agents have a real estate license.

I was presented with a Clarity promise of respect for the customer. I was in the hospitality business. I can’t imagine treating one of my guests as Diamond has treated me. I was so angry after our call with S C I was shaking. Does she really think I held the agent’s handwritten notes since May 22, 2019, without producing them? Our conversation yesterday felt like a tricky entrapment.

Complaint #6, J B, A Consumer Protection Attorney, CA, Outcome unknown

April 11, 2021

Platinum Member

We purchased points 10 times. The worst experience was in March of 2021 with Diamond representatives B T, D A, Quality Assurance, and manager Matthew, but we did not purchase.

We bought 15,000 points from H after he insisted that we did not have “full equity” in the US Collection. According to Mr H, this was part of the process needed to get funded to full equity which would allow us to use points to pay maintenance fees at $0.30 per point. He insisted that 30,000 points @ $.30 per point would fully cover our fees. 

We asked Mr H repeatedly if he was referring to DRI’s 30/30 program. He said no. He repeatedly told us to not bring the topic up in the quality assurance review. Mr H all ignored phone calls.

We did not buy at a subsequent 3/2021 meeting that took place at Lake Tahoe, Stateline, NV. We wanted clarification on the roll-out of new benefits and had questions about the DRI/Hilton merger.  We met with BT.  Mr T stated he was QA and not directly compensated for sales but said he is “paid well”.

A lawsuit filed against Diamond indicated QA agents are incentivized: It is not disclosed to the purchaser that the Quality Assurance employee has a financial stake in the transaction and is compensated based on commission dependent on the number of Quality Assurance presentations given; which is paid only if the purchaser completes the purchase. Case 2:18-cv-00903-RFB-GWF Document 3-1 Filed 05/18/18

Mr T stated that he was there to provide transparency and clarity – it was not a sales presentation. He seemed confused as to why we had five contracts. He left for 20 minutes. When he returned, he insisted that our prior contracts were sold at a low price because they were tied to a specific property, which is why they had no resale value. But, converting to equity, we would have a re-salable product. We asked to see in writing how the prior contracts differed from what he was offering. He said the information was proprietary.

After three hours, Mr T left for a 3_rd time, supposedly to inquire about being provided with a printed copy of his proposed offer. He did not return. D A arrived. Mr A said Mr T left. D A used profanity, physically re-positioned himself to block the hallway in an intimidating way, and accused us of refusing to sit down to hear his offer. He wouldn’t inform us of his full name (I learned his name during a survey).

Mr A left and sent out manager Matthew. He said he’d contact his boss regarding our requests for contract terms. He took my name, email, and phone number. He assured me I would be called by the next day and he would ask QA if they could send us a PDF of the proposed contract. I received no email or call.

BUYER BEWARE

In 2020, the FTC listed Timeshare Sales at #9 on their Top Ten Scam list ($18 million) and Timeshare Resales ($13 million) at #10.

The Westgate MLA Lawsuit and new demand for arbitration

https://afterinsidetimeshare.com/?p=982

Westgate Case No 8;22CV-00283-CEH-JSS

Once again thank you for sharing your story and also to Irene for all the work in preparing these reports. These are just the tip of the iceberg, with many more being received by AIT on a daily basis, we see even more on the various forums. There must be something drastically wrong when an industry cannot accept responsibility for the wrongdoing of its sales staff, we see this as complicity in the deceit of consumers, military or otherwise.

In the past these stories would never have been put together, after all, they don’t know each other, yet they all say the same thing and in many cases actually all name the same sales agents and managers. Thanks to the internet we can see a very disturbing pattern that has been going on for years, fraud on a massive scale, all because the industry felt safe in the knowledge that it would not get any publicity.

How wrong they were, it is time they became accountable, they must take action against these agents, and ensure they can longer work in the industry. But we suspect that their greed will prevail and they will continue as before, denying all responsibility.

That is all for this week and it is also our last article for July, another month over and more complaints on file, some of those will eventually end up on our pages, in the meantime, have a good weekend. Baby Dog our “Undercover Consumer Watchdog” still hasn’t quite understood the meaning of the word “Undercover”, but does have a good nose!