They Seem Genuine but it Comes Down to Trust

For most timeshare owners their first contact with companies offering legal and claims services have been by “Cold Call”. The vast majority of these turn out to be nothing more than scams, taking advantage of owners wanting to be rid of their timeshare, and enticing them to sign up with the promise of a substantial claim. In most cases, they will take thousands in upfront payments and have a “success fee” of around 25% to 40%, payable at the end.

The “cold call” is the fishing expedition, to find out as much about your timeshare ownership as possible, they probably already know where and what you own, possibly even when you purchased it and for how much. The priority for the caller is to sow the seed that you want out, you may have inadvertently told them this by your reaction, and then comes the crunch, you could be in for a big payout.

Now they have your interest, it is time to book an appointment with one of the “consultants”, sometimes they may use the term “legal consultant”, just to make it sound more official. The purpose is to “verify” you have a valid claim, so all your documents are going to be required, that’s more detailed information you will pass over.

After this preliminary “consultation”, you will be informed that you do have a valid claim, and everyone will, it is a numbers game, so an appointment is made for either a home visit or video call, whichever it is, that is when the real hard sell kicks in.

The clincher for most signing up is the money, coupled with the promise you will rid of your timeshare for good. To back up what they are telling you they will probably refer you to their “credentials”, the names of “law firms” they work with, and that they are also “authorised” by the FCA including a registration number.

But all is not as it seems, the FCA Authorisation is not unique to them as the notice from one particular registration states:

This firm is an Introducer Appointed Representative (IAR). This means it can act on behalf of a firm (its principal firm) that is authorised for specific regulated businesses in the UK. The principal is responsible for these regulated activities. Introducer Appointed Representatives can have more than one principal. This firm can only introduce customers to another firm or members of the firm’s group, and/or give out certain kinds of marketing material.

FCA Registration page.

This authorisation from the “principal firm” may also be given to others, it is very similar to that used by timeshare sales as “authorised” to broker loan agreements. The “principal” is the one who is regulated, it is up to them to ensure that all necessary regulations are adhered to by their “appointed representative”.

This is the same as with the Azure brokered BPF loans, Azure brokered the loans without the due diligence being conducted in the appropriate manner. BPF failed to ensure that their “appointed representative” complied with all the due diligence required when brokering a loan. As far as BPF were concerned it was not their responsibility, they were assured the “correct procedures” were used.

The principal is usually the law firm or claims management company and is normally the one they will mention on their website and during the meeting. Verifying that those named are working with the company you are dealing with beforehand does not necessarily confirm anything. In many instances requests for verification from a named law firm have never been received.

Even if they do confirm, it does not make the company you are dealing with genuine, they could still be a scam operation. The firm that will do the work such as a law firm is not allowed to “direct market”, they can, however, use “marketing” companies to provide clients. So the law firm is working on trust, especially when approached by a new firm with new clients.

This has proved the undoing for several legitimate law firms, with not being paid for work completed, then the company in question disappears, leaving the law firm out of pocket and clients who now have to pay again if they want to continue with their case.

Unfortunately, it is also a get-out clause for the more unscrupulous lawyers who knowingly work with the scammers. They can legally claim they have done no wrong. AIT knows several who have consistently shown they work with scam operators.

It is often not only the firms who are supposed to carry out the work and the clients left high and dry, there are also some innocent employees who have been duped. We say innocent because in many cases they are genuine people just looking for work, they will have been presented with the same information as the client and will believe they are genuine. Until it all goes pear-shaped, the firm disappears and they are left without their pay.

If the law firms and claims companies have been taken in, then what chance do the consumers and potential employees have in avoiding them?

The answer is very simple, with great difficulty, in a way it is the authorities who are tasked with regulating along with those regulations which are at fault, they provide shortcuts which are being exploited by the criminal elements.

No amount of checking will guarantee safety, it is down to trust.



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