Recovery scam targets timeshare owners

FORT LAUDERDALE, Fla. -- Timeshare owners have lost millions to scam operators falsely claiming to line up buyers for their properties in recent years. Now they have a new worry: Bogus outfits offering to help recover their losses -- for a fee.

The Florida attorney general has received more than 600 complaints in the past 12 months about "timeshare recovery operations" and is investigating one firm named in some of those complaints.

Independently, the Florida Department of Agriculture and Consumer Services is looking into possible telemarketing-law violations related to several recovery outfits, said Sasha Velez, a senior financial investigator. Typically, recovery telemarketers contact timeshare owners who lost money in bad resale deals, tell them the resale firm was a scam, and offer to recoup what was paid, she said. Their fee is a percentage of what's to be recovered, and the money sometimes is requested in advance, she said. But state records show that even when the firms don't take up-front fees, some are finding ways to keep consumers' money without gaining any refunds for them.

"The same people are getting victimized twice," said Bruce Reppert, an assistant U.S. attorney in Illinois who successfully prosecuted resaler Jennifer Kirk. She bilked $30 million from 22,000 people nationwide through south Florida-based Creative Vacation Solutions.

Regulators say the number of recovery businesses is growing, soliciting property owners who have lost millions of dollars to resale firms that thrived as the market fell. About 17,600 resale complaints have been filed with the state attorney general in the last 20 months.

The nation has about 197,700 timeshare units, and 35 percent of them are in Florida, according to the American Resort Development Association, the industry group.

The Florida Attorney General's Office is investigating Audit Recovery Systems of Boca Raton. Officials said they are probing whether the firm inappropriately failed to refund fees paid to the firm by owners whose losses were not recovered.