Insolvency Service investigation leads to High Court closure of fraudulent timeshare claims firm
Timeshare claims
Timeshare sales operations have earned an appalling reputation for customer manipulation, high pressure sales, criminal activity and disregard for consumer laws over the last two and a half decades.
Suing these companies in Spain proved to be difficult for individuals due to bureaucratic lethargy and complex, legal, red tape. Claims companies incorporated to manage the process, and from 2016 onwards have been enjoying unchecked success on behalf of their clients. To the point where nearly all of the worst offenders have been ordered to pay so much money to their victims that they have been forced to close down.
Fraudsters switch sides
Having lost their ability to swindle prospects via illegal contracts, many of the shadier timeshare characters saw an opportunity to cash in by launching scam claims firms. With their deep insider knowledge of the business it was a logical step for them to opportunistically ‘jump the fence’ and reinvent themselves as defenders of timeshare victims (ironically in some cases selling these services to their own victims).
This poacher-turned-gamekeeper approach does hold logical possibilities for being able to hold timeshare companies accountable for their transgressions. After all, their insider knowledge ought to be invaluable to those battling for justice.
Unfortunately the people offering to help have often abused their clients’ trust.
Why bother doing the work?
The duplicitous nature of many individuals who got rich via timeshare operations meant that they were inclined to look for shortcuts to profitability. Setting up a genuine claims firm like European Consumer Claims requires hard work. Relationships need to be established with credible and capable legal partners both in the UK and Spain. And with most claims firms taking a significant percentage of their fee on completion of the claim, it requires patience and adherence to legal requirements.
It occurred to a significant amount of fraudsters that if they charged the fees, but never did the work, there would be far less overheads. All money received would be pure profit. Obviously they could only operate until their online reputation got so bad they could no longer attract new customers. But then they could re-open under a new company name.
Today, the vast majority of timeshare claims firms are fraudulent.
Fortunately there are plenty of ways to distinguish genuine claims firms from scammers, provided you take the time to check out the important details.
Insolvency Service closes down Timeshare Legals Limited
Timeshare Legals Limited (TLL) is an outlier in that it has stayed in business far longer than most of the suspect companies who took upfront claims fees without any realistic chances of success. TLL was incorporated in 2018 and managed to continue operating for almost 6 years, despite having no staff at their listed office in London and no way for clients to contact them.
Reacting to multiple public complaints, the UK Insolvency Service was able to force the closure of TLL after a comprehensive 3 year investigation.
The results were presented to the High Court who in April 2024 ordered the company to be wound up in April 2024. Mark George, the Chief Investigator, commented that, ‘Timeshare Legals deceived hundreds into paying upfront fees for what were ultimately futile cases.’
The investigation unearthed over 440 clients, a large number of whom paid fees despite no assessment having taken place, and who never could have legally qualified for a claim. Many of these clients were misled about the progress of their cases, and were told that Spanish lawyers were working on them when in fact the cases had no jurisdiction in Spain or were otherwise technically disqualified.
Clients were aggressively persuaded to waive their legally guaranteed 14 day cancellation rights and investigators were unable to locate £3.75 million in fees taken by the company.
Avoid unscrupulous companies
“The claims process can last 18 months, or sometimes even longer,” notes Greg Wilson, CEO of ECC. “So choosing a reputable and capable claims firm is even more important than the basic requirement of protecting yourself against losing money.
“The other issue is that by the time you realise the firm are scammers, another year and a half has gone by. You have still had to pay maintenance fees and your claim has not been started. You would be back at square one.”
“The goal of course is to choose wisely once, and get it right first time,” continues Wilson. “There are plenty of online resources to help you make the right choice. And some of the guidelines will seem obvious. It is a matter of following them all and not letting some slick salesperson talk you into ignoring red flags like the company having a hastily put together, unprofessional looking website, having poor TrustPilot scores, or a lack of published video reviews.”
Need advice?
If you are looking to discuss a timeshare problem and need a no-obligation consultation before deciding whether or not to make a claim, or if you have already made a claim but are suspicious that the company may not be living up to their initial promises, get in touch with our team at the Timeshare Advice Centre.
