Scamwatch: timeshare resale fraud

Stay one step ahead of the fraudsters with our series of articles giving you the lowdown on the scams they use to trick people out of their hard-earned cash - and how to avoid being taken in by them.

This week, timeshare resale fraud used to scam thousands of British holidaymakers every year.

How does it work?
Timeshare sales are rife with scams, such as when people are invited to a presentation where they will receive a gift or prize, before being asked to pay an administration fee that actually more than covers the cost of this "gift" and being pressured into signing a timeshare contract.

And some of the tricks used on people who already have timeshares are even nastier. Spanish police announced this week that they had smashed a timeshare fraud ring run by Britons on the Costa del Sol.

According to their report, the ring was raking in more than £4 million a year and has scammed at least 500 people out of up to £35,000 each using a three-tier fraud initial calls from fake resale agents, followed by people posing as lawyers and finally court officials.

Inspector Mercedes Perez Quesada, the lead investigator on the case, said: "Once victims had been conned and knew they were never going to get their money back, a second group of people would call claiming to be lawyers saying they were going to launch a group action on behalf of victims and asking once again for money upfront.

"The third tier involved people posing as court officials ringing victims and saying cases had been resolved in their favour but they had to pay fees so they could obtain their cash settlements."

How can I avoid being caught out?
The timeshare resale market is virtually non-existent, so you should always be very wary if you are contacted by a company claiming to be able to sell yours on.

For those interested in investing in a timeshare property, meanwhile, it is sensible to research the company, the development and the local rental market thoroughly before signing up.

Other tips include always getting a lawyer to look over timeshare contracts, whether for sale or resale.

I've been defrauded. What should I do?
If you are caught out by a fraudulent timeshare company, you should cease contact with the fraudsters and report it immediately to Action Fraud on 0300 123 2040.

Under the Timeshare Regulations 2010, all timeshare agreements signed in the UK come with a 14-day cooling off period, while those signed elsewhere in the European Union give you 10 days to change your mind.

You should cancel the agreement in writing - preferably by recorded delivery - if you want to take advantage of this right.

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