Bogus holiday clubs warning

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17 Apr 2011

Bogus holiday clubs warning

Brussels 19th August 2009 – An ex-police inspector is leading a project organised by RDO (Resort Development Organisation) to warn consumers about the dangers of bogus discount travel membership clubs – more commonly known as holiday clubs – and fraudulent resale companies.

The project aims to draw attention to unscrupulous companies that deliberately deceive consumers and pressurise them into signing up to membership of a holiday club or a resale scheme.

Holiday clubs promise a lifetime of discounted luxury holidays at hundreds of locations around the world. Having paid a fee of between £3,000 and £25,000 to become a club member, many customers find that the reality does not live up to the promises made during the sales presentation and they have merely bought access to a bookings service such as a website or even just a telephone number.

Unscrupulous clubs often only provide last-minute, limited availability accommodation that is usually low-star rather than luxury in standard. As well as the membership fee, each holiday taken has to be paid for and by the time a club member tries to book a holiday, the company could even be out of business.

Holiday clubs are not covered by the European Timeshare Directive. This means that, unlike timeshare, there are no automatic cancellation rights for those who change their mind. Bogus holiday clubs exploit this by employing high-pressure sales techniques such as long presentations – lasting up to six hours – to get customers to sign a binding contract.

Bogus resale companies operate by demanding a fee of up to £1,000 before undertaking to sell an owner’s timeshare. Many make contact through a ‘cold call’ and, to persuade the owner to pay the fee, claim that a buyer has already been located. On receipt of the payment, however, the sale falls through and the company refuses to return the money. In an increasing number of cases, the seller is instead invited to a presentation and is pressurised into signing up to a holiday club that they had no intention of buying into.

Members of the public should be aware that the majority of companies making such offers are not legitimate, can cause financial detriment and, in some cases, can result in the loss of an owner’s membership week(s).

RDO’s chairman, Richard McIntosh comments “We strongly recommend that timeshare owners do not accept offers made by companies they do not recognise. They should instead contact RDO’s Consumer Services Department on to check if the company is a member of the organisation and complies with its Code of Conduct.”

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