‘I lost another £21,000’: scam claims firms prey on timeshare mis-selling victims 

Covid-19 has prompted timeshare customers to seek an escape from unfair contracts, but scam firms are waiting to pounce

holiday jigsaw
Customers have lost thousands trying to escape expensive holiday contracts Credit: Ellie Littlemore for the Telegraph

Holidaymakers who were sold a timeshare dream that turned into a nightmare have become the targets of bogus claims firms that promise to win back lost cash.

Claimants have lost even more of their life savings after following the advice of rogue companies that seek to swindle timeshare mis-selling victims for a second time.

The coronavirus crisis has led to a huge fall in travel, prompting many timeshare customers to seek to exit their contracts. However, experts have warned that unscrupulous firms are seeking to capitalise on this trend.

KwikChex, an independent investigation service, estimated that consumers had lost more than £150m to these “double dip” scams.

The mis-selling of timeshares in Europe and America has been a long-running problem for British citizens seeking a home away from home. Deals typically give holidaymakers the right to spend a number of weeks each year at a resort. However, they have been criticised for their lengthy contracts, which can last for decades, and high charges.

They are often sold alongside packages that offer worthless benefits or membership points. It is thought that hundreds of thousands of Britons have bought timeshares since the industry’s heyday in the 1970s to 1980s.

Telegraph Money has spoken to several tourists who were pressured into agreeing to expensive, poor-­quality timeshares, then exploited again by firms that said they could reclaim their lost cash. These companies ask for upfront payment, only to disappear once the money has been handed over.

Jen Lewis, 64, from Bath, bought a timeshare in Malta in 2013 after she was invited to watch a presentation while on holiday. Over two days she was subjected to pressure selling that led her to agree to a £40,000, 10-year timeshare.

“They kept saying what a wonderful thing it would be to have this timeshare,” she said. “After about seven or eight hours of going through it, they said they would pick us up in the morning. Then we went through it all again the next day. We were exhausted.”

On her return to Britain Mrs Lewis realised that she had signed up for a contract she could not afford. The timeshare firm said she would face large penalties for exiting her contract early.

Mrs Lewis was later contacted by a claims firm, which said it could cancel her agreement and claim compensation. It persuaded her to transfer £21,000 to fund a legal challenge, but this never materialised. “This was fraud again, so we ended up losing out twice,” she said.

Arthur Upshall from Gillingham, Dorset, fell victim to similar mis-selling. The 71-year-old was sold a £20,000 timeshare contract in Florida and realised he had been duped only when he was asked to pay a further £6,000 for non-existent perks. He was also persuaded to transfer £16,000 to a scam claims firm to recover his cash. Like Mrs Lewis, he has yet to receive any money back from his timeshare.

Although the rogue claims company has since been liquidated, both Mrs Lewis and Mr Upshall were able to recover the money lost to the claims firm by lodging a “Section 75” claim. As they had paid some of the fees by credit card, they were able to claim back the full amount from their card company.

Both used a claims firm that charges 30pc plus VAT for its services, but consumers are able to lodge Section 75 claims on their own free of charge.

Chris Emmins, of KwikChex, said many timeshare victims were targeted by firms that claimed they could help secure compensation. “The businesses seem to do this so they can justify the several thousand pounds in fees, arguing that they will get you back far more than you could on your own,” he said.

Mr Emmins warned that the majority of scam firms were operated by individuals who had previously sold timeshares themselves. These companies often vanish, before the owners set up similar firms to repeat the deception. Mrs Lewis said she received calls from scam firms every week.

Despite the dangers, legitimate claims can succeed. In Spain, where many timeshares are located, the Supreme Court ruled that contracts must not be open-ended or exceed 50 years. Many Britons have been able to recover money under these rules. Since new EU laws were introduced in 2009, buyers must also be allowed a 14-day cooling-off period. This offered another avenue for claims.

However, Mr Upshall, who bought a timeshare in America, is not covered by these rules. “I don’t think I’ll ever get that [money] back,” he said.

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