Timeshare Resale Scammers Barred From Business, Must Pay Millions

FTC Alleged that Defendants Falsely Claimed They Had Buyers Lined Up for Consumers’ Properties

As the result of a Federal Trade Commission action, the operators of a scheme that allegedly deceived consumers who were trying to sell their timeshare properties are permanently banned from the timeshare resale business, and from all telemarketing, and one of them has been ordered to pay more than $6 million. The FTC’s case against National Solutions LLC is part of its ongoing effort to stop timeshare scams and protect consumers from fraud and deception in the marketplace.

In July 2011, the FTC charged Leandro Velazquez, Edgar Gonzalez, Samuel Velazquez, Joel Velazquez, and others with violating the FTC Act and the FTC’s Telemarketing Sales Rule by misrepresenting that they had buyers willing to pay a specific price for consumers’ timeshare properties, that they would refund their up-front fee when the property was sold, and that the FTC would review and approve proposed sales. At the FTC’s request, the court halted the operation, pending litigation.

According to the FTC, the defendants charged consumers up to $3,150 as an “earnest money deposit” to commit them to the sale or for sale-related expenses, and promised to refund the money when the sale closed. Customers often were not contacted again, their properties were never sold, and their refund demands were ignored or denied. Contrary to the defendants’ alleged assertions, the FTC does not review or approve timeshare sales.

The court entered a final judgment against Leandro Velazquez and approved settlement agreements with Edgar Gonzalez, Samuel Velazquez, and Joel Velazquez. In addition to banning Leandro Velazquez from all telemarketing and from participating in the timeshare resale business, the court order prohibits him from collecting money from customers, selling or otherwise benefitting from consumers’ personal information, failing to properly dispose of customer information, and misrepresenting material facts about any goods or services. The order also imposes a judgment of almost $6.3 million against Leandro Velazquez. The three settlement agreements include the same bans and impose the same monetary judgment, which is suspended based on their inability to pay. The full judgment will become due immediately if those defendants are found to have misrepresented their financial condition.

Litigation continues against and Kiomary Cruz and the corporate defendants. – Source

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