The FBI has warned that there has been a surge in scams targeting timeshare owners, with the majority of these scams being perpetrated by Mexican drug cartels.
In this scheme, criminals target part-time property owners, often older Americans, and convince them to hand over large amounts of cash under false pretenses related to timeshare properties.
Scammers typically thoroughly research potential victims, create fake documents and pose as individuals from “trusted institutions” to sell their story and scare the victim into compliance, the FBI said.
Scammers use a combination of high-pressure sales tactics and cyber-enabled fraud strategies to trick victims into believing it is legitimate.
Assistant Special Agent in Charge Paul Roberts These plans are “It has a devastating effect on victims’ financial futures, relationships, and physical and mental health.”
The revenues are increasingly being used to fund drug cartel violence in Mexico.
Roberts said the nefarious activity is attractive to cartels because it is generally less expensive and poses fewer logistical, labor and surveillance challenges than other sources of revenue, such as drug and arms trafficking.
The fraudsters themselves often take part in these schemes out of fear of becoming the cartel’s next victim.
Several Mexican drug cartels are involved in the timeshare fraud scheme, but the Jalisco New Generation Cartel plays a leading role, based on “complaint reports and financial tracing,” the FBI said.
The office is working with the Drug Enforcement Administration and the Treasury Department’s Office of Foreign Assets Control in investigating these cases.
“The recent activity in Mexico is just one example of abusive behavior by third-party timeshare withdrawal companies,” the American Resort Development Association (ARDA) told FOX Business.
“That’s why at ARDA, we promote early and effective consumer education on how to legally exit a timeshare to prevent scams like this one from taking root. In fact, we’ve partnered with our members to create the Coalition for Responsible Exit as a resource to help timeshare owners responsibly and safely exit their timeshare if they decide it no longer fits their lifestyle,” said Jason Gamel, ARDA president and CEO.
“I encourage anyone considering selling their timeshare to visit ResponsibleExit.com and never respond to aggressive resale offers.”
