Whistleblower: Time share rip-offs soaring

  • Article by: RANDY FURST , Star Tribune
  • Updated: June 5, 2011 - 7:33 AM

The feds put one time share resale operation out of business, but others are flourishing.

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Steve Edwards of Big Lake was one of 16 Minnesotans scammed by a time share resale company called Real Timeshare Marketing for a total of $31,741.

Photo: Renee Jones Schneider, Star Tribune

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After getting divorced in 2008, Steve Edwards of Big Lake was eager to sell his time share condo in Florida. He was thrilled to get a call in April 2010 from a company called Real Timeshare Marketing, telling him there was a buyer for his Fort Lauderdale property.

At Real Timeshare's urging, Edwards paid $2,341 immediately to cover closing costs and title transfer fees.

"I was so anxious to get rid of it, I was probably believing more people than I should have," the 46-year-old construction worker said.

Months went by before he realized the deal was a sham.

Edwards was one of 16 Minnesotans ripped off by Real Timeshare Marketing to the tune of $31,741, according to a compilation of records contained in a federal prosecution. In all, Real Timeshare bilked more than 615 consumers in 46 states and six Canadian provinces of more than $1.3 millions, federal authorities say.

Last month, the mastermind of the scheme was sentenced to 10 years in prison, but authorities say it's unlikely the victims will get much restitution. While one criminal operation was put out of business, time share scam artists have been flourishing, inspired by the economic downturn and the desire of so many time share owners to unload them.

Victims of Real Timeshare Marketing say they have been targeted by new swindlers that make false promises to recoup their losses.

"There has never been a worse time to try and sell a time share," says Brian Rogers, owner of Timeshare Users Group of Florida, a consumer advocacy organization. "The overwhelming number of people in the reselling industry are looking to rip people off."

Last month, onetime Real Timeshare Marketing executive Darnell Disroe, 38, of Boynton Beach, Fla., was sentenced to 10 years in prison in U.S. District Court in East St. Louis, Ill. Two co-defendants, Florida residents Michael Lentine, 32, and Michael Starace, 42, received prison sentences of 51 and 18 months.

"Real Timeshare Marketing did not successfully sell any consumer's time share interests," the indictment said. Disroe and his cohorts pocketed two-thirds of the purported closing costs, with the rest going to the telemarketers.

"We are hoping that long prison sentences deter telemarketers from getting into this time share resale business," said Bruce Reppert, the federal prosecutor who secured the convictions.

Yet Minnesotans who lost money to Real Timeshare Marketing say they're getting calls from new scammers.

In retrospect, Jolene Huber of Blaine say her experience buying a Las Vegas time share felt like a rip-off from the get-go.

Huber and her husband were celebrating their 10th wedding anniversary in Las Vegas three years ago when they paid $25,191 with the promise they could stay at time shares in other parts of the country.

They learned later that wherever they went, they would have to pay the maintenance fee, says Jolene Huber, who works in a supermarket wrapping meat. "I felt scammed and hustled," she says.

After trying to sell their time share, the Hubers were defrauded by Real Timeshare Marketing for $939. Then someone called them, saying that for an upfront fee of 20 percent, the Hubers would get their money back. Her response to the caller is unprintable.

Barbara Engesmoe, 71, of Hendricks, Minn. said she fell for scam after scam after trying to sell a time share that she's never seen. "I have probably lost between $10,000 to $15,000," says Engesmoe, a retired 3M machine operator.

Engesmoe didn't even know her husband owned a time share in Kissimmee, Fla., until he had a stroke and went into a nursing home.

Real Timeshare claimed it had a buyer and coaxed Engesmoe into paying $2,999. That was merely one of the companies perpetrating that swindle against her. Then she said she got calls, offering to get her money back, if she paid a fee in advance, which she did.

"They get you so convinced," she said. "It's been an absolute nightmare. ... I have got myself in a terrible financial mess."

Mary Reisner of Fountain, Minn., said she and her husband bought a time share in Pelican Lake, Minn. about 10 years ago. She's a relief postmaster in Fountain and her husband owns a mowing firm. But the time share was only available during mowing season, so they never used it.

Real Timeshare called, saying it had a buyer, so she put down $1,000. "Then we couldn't get a hold of them." The Reisners are now on a new telemarketing list from a company offering to get the money back.

"We said if you can get our money back, fine, then we'll pay you afterwards," she said. "He said they can't do that, they need their money up front... "

Told that Real Timeshare's mastermind got 10 years in prison, Reisner said, "He had to pay for what he did. The only thing is, I wish I could get my money back."

At his sentencing, Disroe was ordered to pay $1.1 million in restitution, but Reppert said Disroe lacks the assets.

Randy Furst • 612-673-7382

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  • WHEN A TIME SHARE RESELLER CALLS

    The Federal Trade Commission says if you're called about reselling your time share, "go into skeptic mode." It recommends that you agree to nothing, ask for all the information in writing and check them out with the Better Business Bureau (bbb.org). Assistant U.S. Attorney Bruce Reppert, who prosecutes reselling swindlers, has two words of advice: "Hang up."

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