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Holiday club rip-offs
By Tony Hetherington
Mention timeshare to most British holidaymakers and they will run a mile - and quite right too. The whole seedy industry ran on a high-octane mixture of gangsters and con men, whose sales staff offered tacky prizes and false promises to lure the unsuspecting into signing a contract that tied them into paying a fortune in annual service charges.
Eventually, the scandal grew so huge that the EU introduced a compulsory cooling-off period. This allowed victims to get away from the salesroom, sober up, check on the internet to see just who they were dealing with, and then call the whole thing off without losing a penny.
But this is not the end of the story by a long way.
Timeshare scams reborn
Timeshare scams have been reborn as holiday club scams, and according to the Office of Fair Trading, people in Britain lose more money to holiday club swindles than to any other type of scam, with 400,000 victims cheated out of £1.2 billion every year.
The scams often start in one of two ways. If you're at home in the UK, you receive a letter saying you have 'won' a free holiday. To claim it, you are told to attend a presentation at the travel company's offices - which turns out to be a lengthy sales pitch.
If you're abroad, usually in Spain, you will be stopped in the street by a tout who offers you a free scratchcard that - surprise, surprise - turns out to be a winner. To collect your prize, which is usually a cheap bottle of wine, you once again have to sit through a sales talk that can run on for several hours.
All this hard work by the sales staff is designed to convince you that if you part with thousands of pounds now, you can have cheap holidays for years to come. The truth, however, is rather different.
One couple who paid almost £9,000 to join the Designer Way Vacation Club were assured they would get huge discounts for the next 25 years from a travel firm called Timelinx. But when they tried to make a booking, the price quoted was actually higher than the cost paid by people who had not joined the club.
Tricksters
Designer Way and Timelinx are well-known to the OFT. They are part of a group headed by Garry Leigh.
Leigh started making his fortune in the 1990s, when he and his father, Tom, ran a Yorkshire-based pyramid scam called the FPW Club.
Advertising with the slogan 'Turn £140 into £600 as many times as you like! It's as simple as that! No catch, no limits',
Garry and his dad tricked 8,500 investors out of more than £8 million before the Department of Trade & Industry won a court order to stop them.
Another company familiar to OFT officials is Full Circle Holidays, based in the Costa del Sol. Some of its members were talked into joining this holiday club with the promise that after a few years they would get a complete refund from a Gibraltar-run cashback scheme. And it came as no surprise when the refunds failed to appear.
Holiday clubs have become such a problem that OFT officials have even handed out leaflets at British airports, telling holidaymakers not to be tricked into attending a sales talk. As the Timeshare Consumers Association says bluntly: "Holiday clubs are bad news."
Tony Hetherington is Consumer Champion of the Year 2006.
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