Whistleblower: BBB warns of Minnesota timeshare rental scam

  • Article by: JANE FRIEDMANN , Star Tribune
  • Updated: April 22, 2013 - 9:28 AM

A company called Platinum Resort Services lists two downtown Minneapolis addresses and a phone number with a 612 area code. It offers owners of timeshare vacation homes a moneymaking opportunity: Pay us a fee and we’ll rent out your timeshare. Then you can collect the income with no worries.

E. Alan Rivas, of Lansing, Mich., took the company up on the offer to be his rental agent for a timeshare in Puerto Vallarta, Mexico. But Rivas and other Platinum Resort customers say the company took their money and did nothing.

They won’t have much luck tracking down Platinum Resort’s executives in person: One of the listed Minneapolis addresses doesn’t exist. The other is an office-tower suite occupied by a different company that complained to the authorities when it found out Platinum Resort was using its address.

Last month, the Better Business Bureau (BBB) of Minnesota and North Dakota put out an alert about Platinum Resort.

Four customers complained that Platinum Resort failed to pay them for timeshares they claimed they had sold. Rivas and one other customer complained of promised rental income never received.

“The company makes big promises, collects upfront fees, and then when the time comes for them to ‘pay up,’ they find convenient excuses to delay and keep customers at arm’s length,” said Dana Badgerow, president and CEO of the BBB of Minnesota and North Dakota.

Platinum Resort could not be reached by Whistleblower for comment, but it responded to some BBB complaints by saying, “Timeshare or vacation club certification [getting all documents in order] can sometimes be a lengthy and tedious process,” “We as brokers do not receive a commission until a property is sold or weeks are used” and “We cannot control financial institutions or rental cancellations for that matter.”

One advocate for timeshare owners say rental scams are lesser-known but equally prevalent as swindles involving timeshare resales.

“Most scammers use both tactics regularly,” said Brian Rogers, owner of Timeshare Users Group. “It all comes down to asking for the fee upfront. No matter what line they are spewing out, be it ‘oh, we have a buyer lined up for your timeshare’ or ‘we work for large corporations that buy bulk timeshare rentals for conventions, ’tis all a load of horsepuckey.”

Broken promises

Cindy Rollins, of Lakeville, said she contracted with Platinum Resort last year to sell her Cabo San Lucas timeshare so that she could buy a new one at Puerto Bahia Village and Spa, just north of Puerto Vallarta.

Platinum Resort told her it already had a buyer, so she paid about $30,000 to Puerto Bahia and $927 to Platinum Resort. But Platinum Resort never paid Rollins, she said. When Rollins told Platinum Resort she was backing out of the contract, a representative e-mailed her regrets to Rollins and gave her some advice. “She warned us against contracting with a company who would charge you money and never provide any services,” Rollins said.

Early last year, Rivas was vacationing with his wife in Puerto Vallarta. They agreed to attend a timeshare presentation at Puerto Bahia in exchange for 300 pesos (about $25) in spending money.

The real estate agents were persuasive, but were unable to reel in the couple until another salesman arrived to propose a companion deal, Rivas said. Platinum Resort would take care of renting out the five timeshare weeks the couple would buy for almost $16,000. For an upfront nonrefundable broker fee of $927, Platinum Resort promised to pay $2,600 in rent for each of five weeks each year, Rivas said.

Rivas said he bought the timeshare, signed a contract with Platinum Resort, paid his broker fee by credit card and waited for his first payment, promised by the end of November. Several revised deadlines later, Rivas has come to realize he may never see a penny.

“It’s been an expensive lesson,” Rivas said.

Rivas tried to call his contact in Minneapolis, but he was never available, he said. Later, Rivas was told the man had been promoted and Rivas must deal directly with customer service, which had no phone number, just an e-mail address.

In January, Rivas complained to the BBB. Platinum Resort then sent him an e-mail.

“It is our company policy that if a BBB file is opened or legal proceedings are initiated, we must pull weeks from our rental pool, as this may affect the availability to use clients weeks for rental,” said the e-mail, supposedly written by employee Grant Wilson.

Whistleblower also found it difficult to get an answer from Platinum Resort. On the letterhead of the contract given to Rivas, its address is listed as 96 6th St. S., Minneapolis, which doesn’t exist. On its website, it lists a suite in the Fifth Street Towers that’s occupied by Regus, a business services company.

Platinum Resort has “never been a client of ours or worked from this location. As soon as we found out they were using our address, we notified authorities,” said Scott Ravenscroft, Regus’ director for Minnesota and Wisconsin.

There’s something fishy about Platinum Resort’s 612 number too, Whistleblower found. A woman who answered the phone failed to provide any information or transfer Whistleblower to a knowledgeable co-worker. She couldn’t account for Regus occupying Platinum Resort’s address and said she had to hang up in order to keep the phone line open.

An e-mail to several addresses associated with Platinum Resort went unanswered.

Platinum Resort “is not licensed to do real estate business in the state of Minnesota,” according to Anne O’Connor, a spokeswoman for the Department of Commerce. While she couldn’t comment on open investigations, O’Connor said no action has been taken against the company. She added that if consumers have similar experiences, they should let the department know.

Reached by e-mail, George Triggs, an employee of Puerto Bahia, the Mexican resort, said the development has no affiliation with Platinum Resort.

Rogers, the advocate for timeshare owners, recommends scam victims contact the attorney general in their home state and the state in which the company is listed as doing business. Litigation by state lawyers is the only way victims have a chance of getting any money back, he said.

 

Jane Friedmann • 612-673-7852

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