The FBI is issuing a stern warning to timeshare owners about widespread telemarketing scams linked to Mexico's violent drug cartels. This scheme targets unsuspecting property owners and leads to significant financial losses. Here's what you need to know and how to protect yourself.
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Illustration of timeshare property (Kurt “Cyber Guy” Knutson)
The Dimitrak family's devastating timeshare fraud experience
In late 2022, the Dimitraks, a retired Canadian couple, received a call about selling their Florida timeshare. The scammers knew the specific details of the timeshares and promised to pay Mexican buyers above market value. The scammers employed a complicated process involving a fake New York escrow company, currencyescrow.[.]LLC. The Dimitraks were asked to fill out paperwork and wire more than $3,000 in “administration” and “processing” fees.
For almost a year, scammers have been demanding more money for various taxes and fees. The couple even transferred $5,000 to pay off the remaining balance on the timeshare, believing it to be part of the sale process. Dimitrak, 73, a former long-haul truck driver, revealed in an interview with Krebs on Security that he lost more than $50,000 to the scam. Even after this large loss, the scammer continued to contact them, claiming that the money was waiting for them and demanding further payments.
Fake New York Escrow Company Email (KrebsOnSecurity) (Kurt “Cyber Guy” Knutson)
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Relationship between cartels and fraud schemes
The FBI linked these timeshare fraud schemes to Mexico's Jalisco New Generation drug cartel. According to the July 2024 warning: FBI and Financial Crimes Enforcement NetworkThese scams are part of the cartel's efforts to diversify its revenue sources and fund other criminal activities, including drug trafficking.
Since at least 2012, cartels and other Mexico-based transnational criminal organizations have increasingly targeted American owners of timeshare properties in Mexico, especially senior citizens who are particularly vulnerable to these scams. The proceeds from these fraudulent activities not only support the operations of the cartels, but also contribute to the production and trafficking of dangerous substances such as fentanyl into the United States.
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How these scams work
The Jalisco New Generation Cartel (CJNG) has expanded its criminal activities beyond traditional drug trafficking to include sophisticated fraud such as timeshare fraud targeting unsuspecting individuals, especially Americans. Some of the techniques employed by cartels in carrying out these scams are listed below.
Impersonation of a legitimate entity: Scammers often pose as legitimate real estate agents, escrow companies, or even officials from U.S. government agencies such as the Treasury Department. This tactic aims to instill a sense of trust and urgency in potential victims, making them more susceptible to fraud.
Target vulnerable people: The cartel primarily targets elderly Americans who own timeshares in Mexico. These individuals often receive offers to purchase timeshares at high prices, but must pay various fees upfront, such as taxes and closing costs, before the transaction can be completed. Once these payments are completed, the scammer disappears and the victim incurs significant financial losses.
Use of call center: CJNG operates illegal call centers where employees are often ignorant of the nature of cartels and engage in telemarketing schemes. These centers are strategically located in areas with high unemployment rates and attract workers looking for work. Call centers not only facilitate fraud, but also serve as a means for cartels to control local populations through intimidation and violence.
Complex fraud scheme: Fraud can involve multiple layers of deception. For example, a victim may be contacted multiple times by different scammers posing as different professionals (such as lawyers or real estate agents) claiming that they can help sell a timeshare or recover lost funds. There is. This re-victimization often leads to further economic exploitation.
Violence and intimidation: Cartels maintain control over their activities and take extreme measures to silence potential whistleblowers. According to the report, workers who try to quit these call centers face dire consequences, including murder, which is horrifying for others considering leaving cartel work. It is a message. This brutal enforcement mechanism not only protects their operations but also instills fear within the community.
Digital infrastructure: CJNG utilizes a network of fraudulent websites and domains that appear legitimate at first glance. These websites often imitate real escrow and real estate companies, making it difficult for victims to tell that the interactions are genuine. Many of these domains are linked to a central hub that manages multiple scams simultaneously.
Understanding these operational tactics will help you better understand the complexities and risks associated with fraud perpetrated by organized crime groups like the Jalisco New Generation Cartel. This knowledge is very important to prevent future damage.
Government Warning (U.S. Department of the Treasury Office of Foreign Assets Control) (Kurt “Cyber Guy” Knutson)
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Protect yourself from timeshare scams
To avoid falling victim to similar scams, it is important to take proactive steps to protect your financial interests.
1) Verify the buyer's identity and provide legitimacy. Always verify the identity of potential buyers and the authenticity of their offers. To verify claims made by purchasers, please contact the timeshare company directly.
2) Research the companies that contact you. Do thorough research on any business that contacts you. Look for reviews and complaints, and verify their credentials through reliable sources.
3) Beware of upfront fees. Genuine transactions typically do not require upfront fees for administrative or processing purposes. Be careful if a company asks for such a payment.
4) Use secure communication channels. Avoid sharing personal or financial information in insecure ways, such as by phone or email. Choose the most secure communication channel possible.
5) Don't click on links: Don't click on links or download attachments from unsolicited emails. Scammers often use these tactics to steal your personal information. The best way to protect yourself from malicious links that can install malware and access your personal information is to install antivirus software on all your devices. This protection also warns you about phishing emails and ransomware scams, keeping your personal information and digital assets safe. Get my picks for the best antivirus protection products of 2024 for Windows, Mac, Android, and iOS devices.
6) Consult a professional before proceeding with any transaction. Please seek the advice of a real estate attorney or trusted financial advisor before making any transaction. Their expertise can help you avoid potential pitfalls.
7) Report suspicious activity to authorities. If you believe you have been targeted by a timeshare scam, do not hesitate to report it immediately to local authorities, the FBI's Internet Crime Complaint Center (ic3.gov), or the Federal Trade Commission. Reporting will help prevent others from becoming victims of similar schemes.
8) Invest in a personal data deletion service: While the advice provided is valuable, the most important step to protect yourself from scams like this is to minimize your online presence. Reducing the amount of personal information available on the web makes it much harder for scammers to target you. No service promises to remove all your data from the internet. However, if you want to constantly monitor and automate the process of removing information from hundreds of sites over an extended period of time, a removal service is the way to go. Check out the data deletion services I recommend here.
Cart important points
This is the contract. These timeshare scammers are smart, persistent, and backed by some seriously bad guys. But that doesn't mean you should be scared and do nothing. Remember, knowledge is power. By staying informed and being skeptical, you can already stay one step ahead of these scammers. Trust your intuition. If something feels wrong, it probably is. Don't be afraid to ask for help or report suspicious activity. Let's make life even harder for scammers and keep their hard-earned money where it belongs: in their pockets.
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