Timeshare Scam Victim?

Welcome to Summer, While a Soggy Florida Braces for Hurricanes

2018-06-22T09:41:00.000-07:00

RedWeek just returned from a long road trip where we attended industry conferences in sunny Las Vegas and supposedly sunny Orlando, but as soon as we got to Orlando, we got the word: Rained Out.

Not really, but the Sunshine State turned into the Soggy State during our visit, just in time for the start of Summer, which in Florida rhymes with Hurricane Season (June 1 to Nov. 30). The region deserves a break, because it's still recovering and rebuilding from the last two years of hurricanes. The sticky weather took a huge bite out of Florida and Caribbean tourism and timeshares in 2016 and 2017, and it looks like the weather gods are hungry for more. Meanwhile, big brand hotel and timeshare resorts are rebuilding while independent timeshares are still negotiating with, or suing, their insurance companies to cover repairs from 2016 and 2017. Welcome to 2018, ready or not.

Only thing we could tell from our visit, empirically, is that the Gators are doing just fine in the Orlando canals while visiting Families, soaked to the bone, plunged ahead to consummate their trips to Sea World and Disney, come hell or high water (excuse the pun). Don't think Sea World offers an official Monsoon Ride, yet, but kids are getting a taste of it, anyway.

But that's not what this posting is about. Florida's turbulent weather is just a backdrop for the annual weather report on the timeshare industry, issued this time each year by the American Resort Development Association (ARDA).

ARDA's CEO, Howard Nusbaum, delivered the highlights at the Timeshare Board Members Association meeting in Orlando, where 150 HOA board members and resort managers huddled to address the big and small issues that challenge the sustainability of their resorts.

ARDA's key messages: timeshares are still great; long live timeshare!

In addition to being the eye of hurricane season, Florida is home-base for 373 timeshare resorts, dwarfing #2 California (131), South Carolina (110), Hawaii (94) and Colorado (75). There are 1,570 timeshare resorts in the US, averaging about 200 units per resort. Timeshares exist in 47 states, with only Alaska, Kansas and North Dakota still on the outside looking in. Hawaii and South Carolina are the key growth states. Nevada, thanks to its mega-resorts, has the largest timeshares in the country.

Retail sales volume, among developers, rose 4 percent in 2017. Annual sales hit $9.6 billion and are expected to exceed $10 billion in 2018. ARDA does not track sales in the secondary market, but if it did, or could, the annual sales numbers would be a few hundred million dollars higher. Maybe even a billion or more. Since 2013, timeshare sales have increased 26 percent.

"We're almost back to where we were at the beginning of the downturn (in 2008)," Nusbaum said.

Timeshare occupancy hit 81.4 percent in 2017. As Nusbaum pointed out, that's a number the hotel industry, with 66 percent occupancy, would covet. The average selling price for a new timeshare interval (one week equivalent) was $22,180, a 6 percent jump from 2016. Maintenance fees rose 1 percent to an industrywide average of $980 for a two-bedroom unit.

Timeshare rental income, meanwhile, increased 20 percent to $2.3 billion.

"This is where the Internet is our friend," Nusbaum said. "Rentals are (part of) your sales arm. That's where people kick the tires (of a timeshare vacation)."

At the mega-macro level, timeshares are huge contributors of the US economy, Nusbaum added. The industry employs 511,000 people, pays $10 billion a year in taxes and generates $9.8 billion in consumer spending. Timeshare travelers also tend to spend more on their trips, with the resort community, than typical hotel travelers.

ARDA launches PR campaign to fight back against negative image of timeshare

In addition to touting the industry's economic contributions, Nusbaum exhorted TBMA members to join him in a campaign to "take back the narrative" and tell positive stories about timeshare.

TBMA members are a diverse group --- professionals and amateurs with admirable careers (mostly) behind them. But there is one thing that unites them: as representatives of resorts that are trying to stay competitive, find new buyers and provide meaningful vacations to owners, they are sick and tired of Internet and radio ads, along with occasional feature news stories on travel, that portray timeshares as a terrible ripoff. They’re also aggravated by the seemingly endless string of “exit” companies that solicit owners to cancel their contracts based upon the idea that they were defrauded, 10, 20 or 40 years ago, by a developer that is no longer in business.

The antidote for this angst? Nusbaum is the #1 advocate for the developer industry and, beyond that, for all legitimate segments of the timeshare universe that feel victimized by bad press.

Nusbaum delivered a rousing “we’re not going to take it anymore” speech to the TBMA attendees in Orlando, and they appeared to love it.

He said developers have been called bums and worse. “We need to start talking about exiting responsibly. There is a whole cottage industry hoodwinking people…”

Several major timeshare “relief” companies are being sued by major developers for alleged interference with customer contracts and encouraging owners to default on their payments. Nusbaum is the point man in the industry’s effort to portray longtime owners --- and developers --- as victims of these companies.

“Whether owners love developers…or dislike developers, we are conjoined twins. We are in this together (and) we have to make sure we can support each other,” Nusbaum said. He also offered these nuggets for the TBMA attendees to remember him by:

A pet peeve? #1: Lawyers who file "drive-by" lawsuits against resorts and others who solicit owners to cancel contracts. #2: The industry's reputation, which Nusbaum is paid to promote.

On lawyers: "We passed a bill in the House of Representatives that banned frivolous lawsuits (against resorts) … but we can't get it approved in the Senate. There are too many lawyers in this country and they can't make money, so they have to scam people. I am jaded on the subject."

On fixing the reputation of timeshare: "Some developers have blood on their hands," Nusbaum said. "I am an advocate for resort developers. We are pro 'good' developers. We want a robust platform but also that every single consumer is protected from lies and deceitful behavior. These publicly traded companies (that now dominate timeshare) are the tide that is rising all of the boats in the industry. They are bringing up practices that others have to follow."

For more on these subjects, visit our Ask RedWeek column for June.

Industry Tries to Debunk 6 Myths about Timeshare Owners

2018-05-04T15:32:00.000-07:00

Timeshare owners are a mixed bag: younger, older, wealthy and educated

Younger. Smarter. Wealthier --- and tougher to fool. That's the new look timeshare owner for 2018, according to surveys commissioned by the timeshare industry's trade and lobbying group.

In a recent column posted in Developments Magazine, Howard Nusbaum, president of the American Resort Development Association, debunks 6 "fluffy myths" about timeshares that have haunted the industry's public persona for years.

The results of ARDA's survey are interesting but not always conclusive. But they should trigger many spirited conversations around your resort’s hot tub.

Here are the top six myths that Nusbaum wants to eliminate:

MYTH #1: Most timeshare owners are old, if not senior citizens. According to Nusbaum, 67 percent of all timeshare owners are between the ages of 18 and 54.

OUR TAKE: We’ve attended many timeshare sales presentations but have never seen a teenager in the room, much less buying a timeshare whose average price is $20,000 or more per weekly interval. ARDA's survey also reveals that 33 percent of all timeshare owners are at least 55 years old. This group, incidentally, is also most likely to purchase additional timeshares, since they already know the ups and downs of ownership. FYI, a standard sales presentation contract says participants must be between the ages of 25 and 75 and have a household income of $50,000. Which leads us to...

MYTH #2: Timeshare owners come from lower economic brackets. According to ARDA, the mean household income for owners is $93,000 while the median income is $81,000.

OUR Take: We’ve never seen a timeshare purchaser who appeared to be broke or penniless, so we’re not sure where this “lower economic” myth came from. Anyone attending a brand-name timeshare presentation has already spent a considerable sum just to get in the room (e.g. $1,000 roundtrip per person airfares from the mainland to Hawaii). The economics are different at 40-year-old legacy resorts, where (usually older) owners can be lured to an update sales presentation for coffee and a donut.

Myth #3: Retirees are the single-biggest group of owners. According to ARDA's survey, only 19 percent of all owners are retired. The overwhelming majority of owners, 67 percent, are either employed full-time or self-employed.

OUR Take: Assuming ARDA's numbers are accurate reflections of the people they surveyed, this means that another 14 percent of all owners aren't retired and don't work. Don't know what to make of this group, unless they are spouses depending on the other categories? This 14 percent needs more explanation. But since they are not part of the workforce, we'll add them to the 19 percent of retirees, which means that 33 percent of all owners are either former workers or non-workers.

Myth #4: Timeshare owners are not highly educated. According to ARDA, 42 percent of owners have a college degree while 21 percent hold graduate degrees.

OUR Take: If 63 percent of all timeshare owners are college-educated or better, then 37 percent stopped their formal education after 12^th grade in high school. We have no problem with that, except to wonder how they were able to get a good-enough paying job to afford buying a timeshare, which probably came after they had already gotten a job, bought a car or two, bought a house and had several kids. This 37 percent group must include an amazing numbert of achievers who became successful without a college degree. More power to them.

Myth #5: Most timeshare owners want to get out of their contract. ARDA's surveys show that 70 percent of all owners would recommend timeshare ownership to others, while nearly 75 percent would recommend their home resorts.

OUR Take: Every time ARDA touts a figure like the 70-percent-satisfaction number, it begs the fact that 30 percent of all owners apparently would NOT recommend timeshare. Another 25 percent would not even recommend their home resort to others. Those are big numbers. They also but suggest that these non-recommending owners would be happy to get out of their contracts. We also know, from separate studies on "regret and remorse" issues commissioned by ARDA, that 15 percent of all buyers rescind their purchase within days of their sales presentation. This group could be called "short-term buyers" who bailed after reconsidering their purchase for a few days.

It is also our informed opinion that 100 percent of all timeshare owners will, one day, want out of their contract, for all kinds of legitimate reasons --- health, age, divorce, death in the family, bankruptcy or other money problems that curb vacations, problems with kids, estate or inheritance issues, etc. This is not a bad thing; it's natural and predictable. Far as we can tell, no timeshare owners have ever outlived their "in perpetuity" contracts.

Myth #6: Timeshare owners believe the sales process is high pressure. ARDA's surveys show, contrary to this widely repeated notion, that 71 percent of all owners "found their buying experience to be either excellent or good."

OUR Take: Historically, high-pressure sales tactics are synonymous with timeshare presentations and a key part of the industry's overall public reputation going back 30 years. In our experience, reputations are earned, not accidents or bad luck. For example, there are several lawsuits pending in US courts, right now, alleging that well known timeshare companies used high-pressure sales techniques to persuade buyers into signing purchase contracts. While not taking a stand on the veracity or legitimacy of these cases, their existence (as well as the private settlement of similar cases) suggests that the old high-pressure myth still has some currency among some timeshare owners and, most certainly, persists among the industry’s critics and those who promote more legal consumer protections for timeshare buyers.

What do you think about these myths? Post your comments here. All opinions welcome.

2018 Starts Off with a Bang as Timeshare Universe Adapts to Major Changes in Travel Industry

2018-02-11T18:50:00.001-08:00

Forget January. February 2018 is a great start for the new year. All maintenance fees should be paid by now, and if you want to go to your Hawaiian timeshare next winter, now is also the time to make that 12-months-in-advance-of checkin reservation at your home resort.

But it's also a good month for most timeshare football fans, and they tend to go together, based upon our experience watching NFL games from swim-up pools and hot tubs in all the places that snowbirds escape to during winter months. The Eagles surprise Super Bowl victory over the Patriots was a win for all underdogs, which pretty much takes us all back to our roots as regular people struggling to make our mark in the world.

Speaking of embracing challenge, traditional timeshare developers and vacation clubs are ramping up their efforts to adapt to an Internet-based world where travelers can book timeshares, instantly, for rental rates that match maintenance fees. For travelers of all ages, this means you don't have to own a timeshare to use one. The companies are also rapidly trying to get younger so they can appeal to new and monied travelers who, historically, shy away from lifetime timeshare offerings.

Here's a snapshot of the US timeshare world provided to RedWeek by the American Resort Development Association (ARDA), which serves as the trade association and national lobbying organization for all brand-name timeshare developers and their cottage-industry service companies, including realtors, title companies, lenders, etc.

According to ARDA's industry surveys, developers racked up $9.2 billion in sales in 2016 (and probably more in 2017) in the US, and an estimated $19.7 billion worldwide. These numbers don't include resale transactions, which are not clearly tracked by any major industry group. The industry employs 500,000 people in North America with many based in sunny Florida, which is the WW headquarters for most timeshare companies and home to 50 percent of all US timeshare resorts. More than 9.2 million US households own one or more timeshares. FYI, all major timeshare companies are sloughing off that word --- timeshare --- and using "shared vacation ownership" instead. Years of largely negative news stories about timeshares have taken their toll on the value of the word --- so watch it continue to disappear in 2018 as marketers promote shared ownership and "alternative accommodations."

On the advocacy front, the industry continues to fight transient tax increases in states (Hawaii, et al) that prey on timeshare owners who have no local political representation. It also lobbies regulators and lawmakers to crack down on timeshare scams usually perpetrated by self-styled "transfer and relief" companies that solicit owners (for thousand-dollar upfront fees) with phony guarantees that they will help owners get out of their timeshare contracts. On a related front, individual timeshare companies (Welk, Westgate and others) launched a concerted legal campaign last summer to sue some of these companies that offer exit strategies to owners. While these cases wind through the federal court system, owner lawsuits against timeshare companies are also increasing with claims alleging elder abuse to misleading sales practices.

The industry's published goals for 2018 include more expansion, particularly into the Asia-Pacific and urban markets, more anti-fraud campaigns, developing successful messaging to reach new and younger potential buyers, and "telling our story" to combat negative myths about the industry. It's a full and ambitious load of goals, which we will track for owners as the year unfolds.

CNBC Story Paints Vivid Picture of Industry Resale and Inheritance Issues

CNBC news, a national news organizations headquartered just outside Manhattan, published an in-depth news story Feb. 6 that provides a vivid and comprehensive picture of the major issues confronting timeshare owners. Written by Strategic Content Editor Barbara Booth, the story focuses on the "inherited timeshare conundrum" that confronts owners who are unable to sell a timeshare and cannot give it away to their children or heirs (usually because the kids don't want to inherit the annual maintenance fee bills that come with timeshare ownership). It is a very thorough and balanced piece of journalism that also discusses resale issues, timeshare scams, rental alternatives for owners and corporate exit programs. Booth used RedWeek as a source for some of her material, so we're happy to recommend this article to anyone looking to off-load their timeshare.

Stayin' Alive: High Drama at Two Lake Tahoe Resorts During Timeshare Election Season

2017-10-25T11:06:00.000-07:00

Most people know that fall and football go together. But only a handful know that fall is also election season at timeshare resorts across the country, where very few people vote and, in all likelihood, even fewer care about the outcomes. All owners generally care about is #1 reservations and #2 maintenance fees. HOA board member elections probably rank way down there, like #41.

Not this fall. While thousands of timeshare owners worry about their vacations and resorts in hurricane-ravaged areas of the country, others are paying attention to all the home-grown issues at their own resort.

In fact, from California to Kauai, Idaho to Orlando, RedWeek keeps hearing from timeshare owners who are getting more involved in the governance of their resorts. At a handful, owners are starting to organize themselves to take greater control of management issues. At others, owners are simply getting rid of board members who have overstayed their welcome --- and failed to fulfill their fiduciary duties to make the best decisions on behalf of all owners.

In this spotlight on legacy resorts, we will focus on two aging but desirable timeshares where owners banded together, in dramatic fashion, to prevent their resort from being taken over, or at least controlled by, major timeshare companies.

Both happen to occupy prime real estate around Lake Tahoe, which is a hotbed of timeshare resorts, old and new. Marriott, Diamond, Wyndham, Hyatt, and Welk have major presences and appear to be looking for more. It's also a smorgasbord of older independent resorts facing major renovations, rising defaults, plus rental and resale issues that not only threaten their economic existence, but make them ripe takeover targets for well-financed timeshare companies or investor groups. Some of these aging resorts, according to real estate folks in the area, will eventually fall into the hands of new developers who will invest and re-purpose the timeshare into a modern hotel or other business that is more profitable than a struggling timeshare.

The rest of this blog is about two Tahoe resorts caught in the middle of this struggle. Simply put, they are just trying to stay alive.

PART I: Tahoe Beach and Ski Club Owners Re-elect Board Member Who Cast Key Vote Against Diamond's Potential Takeover, But Tensions Remain

SOUTH LAKE TAHOE, CA --- Sedric Ketchum, the swing vote on a divided board that decided to reject Diamond Resort's takeover moves three years ago, won re-election to another term in September, but it wasn't easy. Recovering from serious surgery, Ketchum barely made it through the obligatory candidate forum, then retired to his room at Tahoe Beach and Ski Club as soon as the votes were cast.

Sedric Ketchum won re-election to Tahoe Beach and Ski Club Board despite a no-confidence vote from Diamond Resorts.

He won re-election handily, despite a defection from one of his fellow board members and a decision by Diamond, which owns 23 percent of all timeshares at the beachfront timeshare, to vote for no one. Right up until the vote was announced, no one knew what Diamond planned. The company wanted to dump Ketchum, but couldn't find a suitable candidate to back, so it sat on its votes.

Tahoe Beach and Ski Board President Al Fong urges owners to stay vigilant against Diamond.

Not exactly a vote of confidence for Ketchum, who was key to the board's rejection of Diamond's perceived takeover bid in 2014. Diamond played cat-and-mouse with the owners in 2017, just as it did in 2016 (when it was also declined to announce its intentions).

In months leading up to the vote, Diamond asked first-year board member Bill Costa to find a replacement for Ketchum, but his recruitment efforts fell short. (Most owners had no knowledge of Costa's activities, and they also seemed to like Ketchum, so why vote against him?) During the past year, Costa also worked on his own to broker a deal between TBSC and Diamond to settle litigation that Diamond initiated in 2015. So it was not much of a surprise that Costa also worked with Diamond on a possible alternative to Ketchum.

We interviewed Ketchum and Costa about their split. It seems to be more personal than professional, so we'll leave it at that. We also interviewed other owners who were brought into the schism, including one owner who was recruited to oppose Ketchum, but they seemed puzzled about it as well.

Ultimately, the tensions within the board did not matter. With more than 175 owners huddled together under a beachfront revival tent on a cold, blue sky day, Ketchum collected 1,985 votes, including 39 voted by the board (Costa abstained). Diamond had 1,750 votes, but kept them in the corporation's pocket for another day. No Diamond representative even showed up to address the crowd --- a far cry from a year ago, when a Diamond VP rankled the audience with a tone-deaf explanation of the benefits of Diamond's presence and points-and-trust program.

"Never take your ownership for granted," warned a somber but jubilant Board President Al Fong after the vote. "Diamond is a sleeping giant. They are waiting for you to fall asleep."

Diamond started buying foreclosed TBSC units at auction several years ago as part of its bid to increase its presence in South Lake Tahoe, where it already operates several timeshares, including the majestic Lake Tahoe Vacation Resort, which is right next door to Tahoe Beach and Ski Club. Diamond was well on the way to becoming the dominant majority owner of TBSC when the board, awakening like a slumbering giant , refused to accept Diamond's purchase of several hundred intervals in December 2014. That HOA action triggered threatening letters from Diamond, and eventually a lawsuit --- which continues to this day.

Since then, the TBSC-Diamond story has devolved into an "us-against-them" fight where owners rallied to elect board members, in three straight years, who are dedicated to keeping Diamond at bay. The anti-Diamond board members ran annual grassroots campaigns, with beachfront owner-update meetings on Mondays and Thursdays, to energize owners about the perceived threat that Diamond, one of the largest and most acquisitive timeshare companies in the world, posed to their traditional legacy resort. So far, they've succeeded in warding off the giant.

Barring a major change in direction, next year's HOA election will put two more anti-Diamond board members onto the same hot seat that Ketchum just occupied. President Fong and Treasurer Jake Bercu, Diamond's most vocal critics, will face re-election while promoting the dividends of maintaining the independence of Tahoe Beach and Ski Club. No matter what else happens, they already know that at least 23 percent of the owners --- Diamond --- will vote against them.

Diamond is not the only major timeshare company seeking a larger footprint in Lake Tahoe. Wyndham, the largest timeshare company in the world, is also seeking a bigger stake. But its plans for a smooth transition --- takeover or otherwise --- just ran into an owner revolt at the Olympic Village Inn.

'PART II: Gang of Four' Owners at Olympic Village Inn Fire Longtime HOA Board Members who Hired Wyndham to Run Resort in 2016

Rebels promise to review Wyndham's contract and end foreclosure agreement

SQUAW VALLEY, CA --- A ballot box rebellion at Olympic Village Inn (OVI), a bucolic Alpine resort in North Lake Tahoe, triggered a palace revolt in October that resulted in the ouster of four HOA board members who agreed, one year ago, to turn the resort's management and all defaulted units over to the Wyndham timeshare conglomerate.

Standing Room Only at annual board election for Olympic Village Inn in Squaw Valley.

Gang of Four rebels routed incumbents who hired Wyndham to manage resort.

In a record turnout on a spectacular fall-colors October Saturday, the so-called "Gang of Four," led by a hard-nosed and proudly profane prosecutor named Bob Bone, dumped four longtime board members who, despite having their own misgivings about contracting with Wyndham, turned the keys to the resort over to Wyndham's management company in 2016. Bone and his co-conspirators, all of whom proudly own the Gang of Four appellation that was hung on them by a hostile board member, immediately fired Board President Alan Traenkner --- Wyndham's primary champion --- and board counselor Joan Wright. They also agreed to dismiss a legal fight, launched by Bone months ago when he was just a fledgling activist, to force the HOA to disclose owner rosters (including emails) to members for campaign purposes.

Elected in a landslide, the new majority at the seven-member HOA is composed of Bone, who replaces Traenkner as president, and fellow activists Julie Feldman, Sandy Farrow and Greg Rankin. They replace former board members Connie Gast, Ron Spiller, Wayne Hooper and Mike Harper (who also opposed Wyndham's hiring but ran afoul of Bone months ago). Holdover board member and CFO Brad Hartman also opposed Wyndham's contract, so he could be considered a potential "Gang of Five" member in the future. The other holdover, Larry Grace, faces the same fate as Traenkner --- obscurity at the end of the HOA bench. In many ways, the election represents a generational pivot as well as a policy change. In with the new, out with the older.

New Board President Bob Bone (top) led a multimedia campaign to oust four longtime board members.

Bone's first move was to fire former Board President and Wyndham advocate Alan Traenkner (bottom)

When the results were announced, the 200 OVI members who shoe-horned into an overfull hotel conference room erupted in applause and shouts --- as if their favorite football team had just scored a touchdown. A record 58 percent of all OVI members voted (in the industry, 20 percent would be normal, 30 percent a milestone). Bone got 2,017 votes, followed by Rankin, 1,997, Farrow, 1,992, and Feldman, 1,818. The incumbents received 139 to 149 votes each, plus 436 votes cast for each incumbent by Wyndham.

Afterwards, the defeated incumbents --- all longtime board members --- exited muttering while Traenkner took stock, shaken if not stricken by his landslide loss in an election that was a total referendum on his move to hire Wyndham. Then with a wave, he was gone.

"I'm not the Gang of Four," Traenkner said, his face flushed. "My job is to make the transition as smooth as possible. We represent the whole association. That's important for people to know."

Several Wyndham executives attended the SRO meeting, wearing casual business outfits and frowns. They said afterwards that they would work with the new board to resolve all issues of concern. But their furrowed brows told the story: Wyndham's experiment with OVI was going south.

Moral of this Election is: Don't Mess with Bonus Time --- or Bob Bone)

Olympic Village Inn, set in an elbow pasture at the base of Squaw Valley's majestic ski area, is probably one of the last places one would expect to morph into a launching pad for timeshare-owner activism. The resort came to fame decades ago as the US host of world-class skiers and other Winter Olympians in 1960. While the Lake Tahoe resort area grew, OVI stayed the same: laid-back and serene, it was a tiny 90-unit timeshare getaway with 3,300 owners and 4,590 intervals that catered to skiing families from the Bay Area. OVI was stable for years; its financials were OK, maintenance fees stayed low ($800) and default rates (from owners) hovered in the single digits. But then things changed.

In April 2015, Traenkner and the OVI board hit a wall: the resort's longtime general manager (who had taken care of everything for 32 years, according to Traenkner) announced he would retire in July 2016. That triggered a search for replacement that forced the board to look outside its local circle of associates. Traenkner attended Timeshare Board Members Association meetings to meet and interview management companies.

Traenkner and other board members talked to several companies, then picked Wyndham, which offered a management deal that no other company came close to matching: Wyndham would spend $1.25 million on renovations, pay $10 for 253 HOA-owned units (and pay all of the maintenance fees for those units), launch a rental and resale program, and fold OVI into Wyndham's global reservation system. In addition to the management contract, Wyndham, a timeshare giant with worldwide experience managing 200 resorts, offered to take responsibility for all future OVI units that go into default (thereby guaranteeing those maintenance fee payments as well). No surprise, the board said YES. As a result, Wyndham took over in August 2016.

Traenkner said recently that he thought he was doing OVI members a great service by hiring Wyndham. Unfortunately for him and his fellow board members, it all went awry.

Olympic Village Inn on a perfect summer day at base of Squaw Valley ski area.

At first glance, this sweetheart deal appeared to take care of all OVI problems: Wyndham would run all resort operations, pay up all late dues, plus guarantee payment of maintenance fees on all future defaulted units. In return for its oversight, Wyndham would gradually acquire an increasing share of the intervals at OVI --- and, potentially, gain voting control oF the board. As of this writing, according to Traenkner, Wyndham owns 436 intervals, or approximately 10 percent of OVI. (Wyndham executives say the company has no plans to take over the board or the resort. At other comparable legacy resorts around the world, Wyndham has used its ownership stake to install corporate execs on the HOA board to protect the company's investment.)

The deal might have worked out famously, in fact, if Wyndham had delivered a gold-medal performance during the transition period. Instead, it stumbled, repeatedly. Wyndham installed a new GM with no timeshare experience who, for various reasons, irritated owners and board members, including Traenkner, Wyndham's champion. Over the next year, Wyndham installed three additional GM's or interim GM's. The company also fired most of the housekeeping staffers because they were not legal residents. Wyndham's reservation team also took over, which surprised owners who knew nothing about the changes. Owners used to calling OVI at Squaw Valley suddenly found themselves talking to Wyndham operators back East.

While Wyndham had some (predictable) hiccups implementing changes, the OVI board overlooked a key issue, and it turned into a fatal mistake: The board failed to tell owners about Wyndham until after the deal was done. Bone, for example, knew nothing about Wyndham's presence until November 2016, when he tried to use his "bonus time" privileges to reserve rooms at a discount so he could bring his ski-oriented family to the resort on winter weekends. Instead of securing an easy last-minute weekend reservation, Bone discovered, from a Wyndham operator, that the bonus time rules had changed.

That innocuous first contact with Wyndham's presence at OVI started a chain reaction that, over months, led to the revolt that deposed four OVI board members, including three who approved of the Wyndham deal. Here's how it all fell apart. Bone, a very outspoken lawyer from Santa Rosa, complained to Traenkner and other board members about the bonus time changes, then started digging into other things that were shifting at OVI --- including the unannounced staffing changes that left the housekeeping team in shambles. Bone, contentious by nature, also had conflicts with the new GM and other Wyndham corporate executives. Over time, an exasperated Bone mounted a very public campaign against the board based on what he perceived as the board's negligence and Wyndham's negative presence at the resort. His efforts not only stirred up other owners, but helped persuade the board to abort the HOA-default foreclosure agreement in March. In June, Bone successfully sued the board in small claims court to secure the membership roster so he could communicate his displeasure about the board and Wyndham with other owners. Instead of turning over the rosters, the board fought the lawsuit.

The campaign got personal in a hurry. Bone called out Traenkner on many occasions and offended other board members as well. He accused the board of election fraud and sent a stream of combative emails demanding documents and explanations of board policy. At the same time, Bone's "gang" launched a phone bank to contact owners and created a "SaveOVI.org"website where they posted information about the board's actions, attacked Wyndham's motives and generated support from owners. The outreach campaign was critical, because Traenkner and the incumbent board never responded in kind. (In fact, after the vote, Traenkner lamented that he never mounted much of a campaign and, worse, conceded having no insight about why owners voted against him.)

"Thanks to this board, the resort is falling apart," said the hyperbolic Bone, an owner since 2012 who primarily uses his timeshare for bonus time. "Wyndham is trying to run the resort into the ground for the sake of consuming it. But I don't really view Wyndham as an evil empire. I'm more concerned about HOA boards that are filled with individuals who don't read documents when they are charged with the responsibility of protecting a public trust."

Greg Rankin, a Gang of Four member and original sales manager at OVI, said he decided to run because "the board made a terrible mistake in selecting Wyndham. And, despite overwhelming evidence over the past year,...they refuse to admit and acknowledge their mistake. The board's unwillingness to provide meaningful oversight of Wyndham...has result in rapid deterioration of the property and a significant decline in both the level of service and overall quality of experience our owners have enjoyed over three decades."

Traenkner, interviewed several times about the transition over the past year, is understandably defensive about hiring Wyndham. "They put money into the association to help with remodeling, so we were able to reduce dues from $840 to $800," he said. "And their rental program has been good." Still, he admitted having numerous "startup issues" with Wyndham that created consternation on the board and within the membership.

Wyndham Very Experienced Running Resorts, but Stumbled at Olympic Village Inn

We interviewed two senior vice presidents at Wyndham about the controversy. They conceded making some mistakes during the transition, but otherwise defended their contract and intentions at OVI. They said Wyndham, which now owns an estimated 10 percent of the intervals OVI (436 intervals) has no plan to take over the board or the resort. In separate interviews over many months, Traenkner and other board members also voiced dissatisfaction with Wyndham's first GM and other aspects of Wyndham's transition, but otherwise defended their decision to bring in a major company that, in their eyes, would ensure the longterm financial stability of OVI.

Consultants familiar with the timeshare industry say there are many ailing legacy resorts in the US that probably need a Wyndham or similarly equipped timeshare-and-management company to advise boards and run resorts. But OVI, they said, did not need Wyndham, because its financials were in generally good shape (thanks to the work of the former GM, who appeared to handle everything.) What OVI needed, these consultants said, was a robust rental and resales program to monetize units that were going into default due to the resort's aging owner base.

In a post-election moment of calm, Bone said: "We ran on a simple pledge of transparency and openness. We also pledged that we would immediately engage in oversight of the new General Manager Wyndham Resort Development Corporation. We promised our fellow members that we would not do what the prior Board did by entering contracts in secret Board meetings where there are no meeting minutes in violation of the resort governing documents and the law."

Bone, who contended all along that OVI didn't need Wyndham, plans to make Wyndham's management team prove their value --- or pack their bags. The company's management contract comes up for renewal in 2019, unless Bone and company take moves to shred it in the meantime. The 2019 year is also when Bone and the Gang of Four will stand for re-election --- and face the same kind of referendum that ended Traenkner's reign as president in October.
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NB: this is not an unusual story; most if not all major developers are collecting deeded-week inventory from legacy resorts, frequently at zero-dollar prices, to replenish inventory for their trust associations, which then re-sell the legacy inventory as points, instead of weeks, for a retail price average of $20,000 or more per week. For the major developers, this is smart business, and it also relieves the financial pressure on legacy resorts, such as OVI, that are losing 100 or more owners per year, every year. Wyndham's timeshare business, which will be spun off into a stand-alone public company in 2018, reported $2 billion in sales for 2016. It has 900,000 owners and owns or operates 221 timeshare resorts in the US, Canada and the Caribbean. OVI, while extremely important to owners, is just a twinkle in the constellation of Wyndham's timeshare universe.

What IS unusual about this story is the unprecedented activism of owners at Olympic Village Inn, rank and file timeshare owners who banded together to initiate changes at their resort. We'll report on the outcomes of their efforts in future installments of 'Staying' Alive.'

Call Your Company or Resort for Hurricane Updates and Reservation Cancellations

2017-09-11T16:21:00.004-07:00

The horrendous hurricanes in Texas and Florida have taken a huge toll in human life and billions of damages in property losses across several Southern states and the Caribbean. To help timeshare owners assess what is going on, RedWeek contacted several companies for updates on their resorts and how to handle cancellations, etc. While the situations are continuing to unfold, here is a quick handle for timeshare owners to monitor the hurricanes and their aftermath.

1. Call your home resort or timeshare company, owner services, to get updates on damages, reservations, and cancellations. Many independent resorts update their Facebook pages with their status faster than they can update their websites, so be sure to check. Most reputable companies are bending over backwards to help travelers rearrange their schedules or, in some cases, get refunds if applicable. We also encourage owners to post their own messages, in the forums on your resort's page on RedWeek, to help inform other owners.

2. Call your preferred airlines as well to determine their policies. All airlines have posted updates about Harvey and Irma on their websites, usually referring people to hotlines for real-time information.

3. The devastation at many Caribbean resorts will probably require many months for reconstruction and resumption of anything close to "normal" vacationing. Owners on St. Martin resorts, for example, may be unable to use their intervals for months, if not years. Here are some examples of what companies are communicating to timeshare travelers.

4. The Vistana timeshare company (formerly Starwood) sent members an email urging owners at Florida's Vistana Beach Club, Sheraton PGA Vacation Resort, Sheraton Vistana Resort, Sheraton Vistana Villages and Sheraton Broadway Plantation to seek updates on vistana.com. Vistana's crisis hotline reported that the Westin St. John on the US Virgin Islands would suspend all near-term incoming reservations until further notice --- since the airport and all local ports are damaged and closed.

5. Marriott Vacation Club's owner services department offers a crisis hotline that is updated every morning at 9 a.m. EST. The Sept. 11 update said Marriott's Frenchman's Cove resort in St. Thomas was closed until further notice while damages are being assessed for "heavy" landscape losses and water intrusion. Marriott also reported no injuries or loss of life at the resort, and said the resort would reopen "as soon as possible." Marriott posted a more positive outlook for the St. Kitt's Beach Club, which is also closed. The resort suffered "no significant damage" and reported that guests are safe. Marriott also urged travelers to contact their travel insurance companies and exchange companies, if applicable, to find out their options.

TimeSharing Today, the industry's only independent site (other than RedWeek) for national timeshare news, just released a number of hurricane-related stories that are worth review.

Please post your hurricane-related stories here.

MAJOR NEWS: New York Attorney General Settles Case Against Manhattan Club and Promises $6.5 Million Restitution to Owners

2017-08-16T14:28:00.000-07:00

AUGUST 16, 2017 --- MANHATTAN. After more than three years of investigation and litigation, the New York Attorney General's Office today announced the settlement of the Big Apple's most notorious timeshare case.

The AG announced that hundreds of owners at The Manhattan Club will share in a $6.5 million settlement approved by the long-troubled operators of the swank timeshare near Central Park. While details of the settlement are still to emerge, it is clear that this is not only a victory for the AG, but for thousands of TMC owners who paid top dollar for timeshares that, over time, they could not easily use. As part of the settlement, the operators of TMC agreed to sell the club to a new company that, presumably, will restore some order and confidence for club members. RedWeek talked to attorneys who represent owners and will share their comments as more details emerge. For the meantime, please see the complete announcement from the AG's office.

A.G. Schneiderman Announces $6.5 Million Settlement With Midtown Manhattan Timeshare That Scammed Purchasers

The Manhattan Club, Timeshare In Midtown Manhattan, Will Pay Restitution To Hundreds Of Purchasers That Were Misled About Their Ability To Reserve Rooms And Resell Shares

Settlement Is The Largest In Recent History Of The AG’s Real Estate Finance Bureau

Schneiderman Reminds New York Residents To Be Wary Of High-Pressure Sales Traps Utilized By Some Timeshare Companies

NEW YORK – Attorney General Eric T. Schneiderman today announced a $6.5 million settlemnt with the owners and operators of the Manhattan Club, a timeshare building in Midtown Manhattan, over the sponsor’s repeated false promises to potential and current share owners.

The settlement is the largest in recent history for the Attorney General’s Real Estate Finance Bureau. Under the terms of the settlement, the operators of the Manhattan Club, at 200 West 56th Street, acknowledge that they repeatedly misled shareowners about the club’s reservation process, their ability to sell back their shares, and the details of the club’s state-approved offering plan.

“The owners of the Manhattan Club lured thousands of timeshare buyers with false promises and shady sales tactics that violated New York law,” said Attorney General Schneiderman. “While timeshares can be legitimate enterprises, scams like this one are common. To avoid becoming a victim, always be wary of high pressure sales tactics.”

The club bills itself as a “unique” “residence-style boutique hotel” that blends “a vacation ownership retreat with a luxury suite hotel” and that offers “a hard-to-find haven in the midst of this active city.” The website appeals to people who “frequently visit New York City to enjoy Broadway theatre, fine dining and shopping, [and] classical performances.”

The owners and operators in this case are T. Park Central LLC, O. Park Central LLC, Park Central Management, LLC, Ian Bruce Eichner, Leslie H. Eichner, Stuart P. Eichner, Scott L. Lager, Hospitality Advisors, LLC, New York Urban Ownership Management, LLC, and Manhattan Club Marketing Group LLC.

In addition to the $6.5 million restitution to eligible timeshare owners, the settlement requires:

The owners and operators to be barred from the timeshare industry
The owners and operators will sell their stakes to a third-party purchaser and relinquish management control
Remove all sponsor-appointed current officers and directors from their positions as members of the Board of the Timeshare Association.

Eligible timeshare owners will be contacted by a Claims Administrator at a later date about disbursement of the restitution.

The Office of the Attorney General (OAG) began investigating the Manhattan Club in 2014 after receiving repeated complaints from shareowners who paid tens of thousands of dollars to become Manhattan Club “owners,” but were unable to make reservations due to a claimed lack of available rooms by the hotel’s operators. At the same time, rooms in the Manhattan Club were being rented over the internet to the general public, in violation of the timeshare’s offering plan.

In Spring 2014, OAG sent undercover investigators to record the Manhattan Club’s “Vacation Ownership Experience” sales presentation. Investigators found evidence indicating that the Manhattan Club’s sales tactics amounted to a bait-and-switch scheme.

Prospective purchasers were baited by a relentless sales pitch that included a number of misleading promises, including that ownership in the Manhattan Club is “better than money in the bank.” Prospective buyers were also told that the club does not rent rooms to the general public, that reservations were easy to make, and that few restrictions apply to reservations by owners.

But these promises were false. For example, contrary to the club’s explicit promises in its offering plan, room availability to owners was greatly limited because rooms were being rented out to the general public. That means that all reservations are subject to availability and owners, in some cases, were unable to use any of the time they purchased. Further, the owners’ annual common charges jumped approximately 200% in the last ten years – to about $2,000 per ownership interest per year for the smaller units – on top of the upfront purchase costs that ranged from just under $10,000 to over $40,000 per ownership interest. Some frustrated owners have sold their ownership interests back for a mere $1, just to escape the burdens of paying these charges.

In July 2014, pursuant to General Business Law section 354, a provision of New York’s Martin Act that confers broad powers on the Attorney General to investigate and halt fraud, a Manhattan Supreme Court justice barred the Manhattan Club from selling timeshare interests, preventing them from withdrawing money from certain bank accounts, and stopping them from foreclosing on Manhattan Club purchasers during the pendency of the investigation.

For information about how to protect yourself from timeshare, home improvement and vacation scams, click here for the Attorney General’s brochure “Don’t Get Burned: Attorney General’s Guide To Protecting New Yorkers From Summer Scams.”

This case was handled by Louis M. Solomon, Chief of Enforcement in the Real Estate Finance Bureau, with assistance from Assistant Attorneys General Nicholas Minella and Kimberly Ver Ploeg in the Real Estate Finance Bureau, as well as Matthew Woodruff, Senior Enforcement Counsel, Assistant Attorney General Tanya Trakht, and paralegals Natalya Fadeyeva and Pascual Noble in the Investor Protection Bureau with notable contribution by Jonathan Werberg, Senior Data Scientist, Research & Analytics. This case was investigated by former Supervising Investigators Luis Carter and Michael Ward, Supervising Investigator Sylvia Rivera, Investigators Karon Richardson, Elsa Rojas and Former Sr. Investigator Richard Friedman, under the direction of Deputy Chief John McManus and Chief Dominick Zarrella of the Investigations Bureau. Former Assistant Attorneys General Serwat Farooq and Elissa Rossi also assisted on the case. The Real Estate Finance Bureau is led by Bureau Chief Brent Meltzer and overseen by Executive Deputy Attorney General for Economic Justice Manisha M. Sheth.

US Timeshare Industry Posts 7th Straight Year of Sales Growth

2017-07-05T15:20:00.001-07:00

Last month, in our Ask Redweek forum, we posted an article about positive trends in the resale market. For the first half of 2017, resale closings tracked by RedWeek rose 46 percent compared to 2016. As a follow-up to our feature on resales, we’ll now give you a snapshot of industry-wide stats just released by the American Resort Development Association (ARDA), the industry’s trade association and lobbying arm in Washington.

The Recession in Retail Sales is Officially Over

In a strong rebound from the Great Recession of 2008, the US timeshare industry continued to show steady sales growth in 2016, making it the seventh consecutive year of expansion for an industry that is still undergoing major changes, including mergers and consolidations, while adapting to new competitors who are using alternative business models to lure timeshare travelers to their programs.

In a report released June 29, ARDA said that sales volume increased 7 percent in 2016 while rental revenues rose 5 percent. Overall sales increased from $8.6 billion in 2015 to $9.2 billion in 2016. Rental income rose from $1.8 billion in 2015 to $1.9 billion last year. Average timeshare occupancy was 79 percent, which compares very favorably to a 65.5 percent heads-in-beds rate for hotels.

“Seven straight years of growth is a testament to the strength of the vacation product we offer,” said Howard Nusbaum, ARDA’s president and CEO. “Timeshare offers more space and privacy, tremendous use-value over time, and over 5,300 resorts worldwide to choose from.”

According to ARDA’s resort-count, there were 1,558 US timeshare resorts in 2016 (for 206,080 units). A whopping 70 percent of those units offered two bedrooms. The average unit size, moreover, exceeded 1,000 square feet. Florida continues to have the most timeshares, by a lot, while beach resorts command the most popularity. Inland resorts, such as Colorado, still claim the highest occupancy rates.

ARDA’s survey of member companies also showed how timeshare and other hospitality companies are adapting to the explosion of new technologies to serve customers. At least 35 percent of all resorts now offer mobile applications (primarily cell phone) to owners for reservations, check-ins, concierge services and onsite communications.

Time for Everyone, Owners and Resorts, to Adopt Tech Solutions

The rush to go-mobile and embrace high-tech communications is no accident. All brand-name timeshare companies are adopting customer-friendly tech programs as fast as possible --- not only to assist customers, but to offset competition from start-up travel clubs and reservation companies that offer products never envisioned by the old-school timeshare companies. Fast-growing travel agencies such as VRBO, AirBnB and others are the vanguard of a new travel industry that seeks to offer more travel options, more adventures, more cruises, instant reservations and, most importantly, more treasured experiences for consumers. That latter idea, special experiences, used to be the preferred domain of timeshare operators at sales presentations. No longer.

At recent industry conferences, CEO’s of the biggest brand-name timeshare developer companies debated the impact of these new players in travel. The newbies include those who offer one-night-at-a-time, sleep-on-a-couch-in-Manhattan stays to entities that offer extended travel excursions to Europe, Africa and China. But there was no agreement among the majors on how to adapt timeshare-in-perpetuity models to millennium-aged travelers who reject long-term commitments and seek shorter, immediate reservations.

One thing all execs conceded, readily. They are hiring millennial-aged marketers (ages 25-40, roughly) as fast as possible to catch up with a travel generation that appears, already, to be way beyond the traditional lifetime contract timeshare era. They are also refocusing sales presentations on the benefits of vacation experiences, rather than vacation cost-savings, to appeal to the potential next generation of timeshare buyers. They are also confident, perhaps as a wish fulfillment, that millennial travelers will eventually switch to timeshares when their lifestyles dictate that a two-bedroom, two-bath, full kitchen condo is much better than a one-bedroom hotel studio for four.

ARDA’s PR and marketing teams recognized this probable shift a couple years ago. That’s when they started promoting industry-wide statistics which showed that timeshare owners have more sex on vacations than “regular” travelers who stay in hotels. Tough if not impossible to argue with that.

Timeshare Industry's Biggest Annual Convention Underway in The Big Easy

2017-03-27T08:27:00.000-07:00

By Jeff Weir, RedWeek.com's Chief Correspondent

Welcome to the Big Easy!

Not sure how many people own timeshares in Louisiana, nor how many timeshare owners live in Louisiana, but RedWeek can guarantee you that several thousand timeshare people --- developers, CEOs, staffers, realtors, resale companies, lawyers, litigators and title experts, PR consultants, escrow agents, HOA managers, regulators, financial planners, software developers and the salt of the earth of timeshare --- sales people! --- are all gathered here in New Orleans for ARDA World, the annual "ain't life grand?" timeshare convention hosted by the American Resort Development Association. ARDA's very capable folks spend most of their time lobbying lawmakers and regulators to make the world a safer place for timeshares (and, frequently, consumers), but once a week, every year, they take time to reconvene the faithful and celebrate the industry. And on the last night of the convention, they give awards to dozens of people who have distinguished themselves over the past year. We'd call the hardware "ARDA-OSCARS".

That's this week in New Orleans. Let the Timeshare Mardi Gras begin. The real one came and passed in February.

The event is happening at a huge Hyatt right next door to the Louisiana Superdome. Every single staffer we've talked has first-person stories, they swear, about surviving Katrina's downtown flooding. Area looks great now. All rebuilt. No water.

The "ain't life grand?" quote is from the award-winning 1967 movie, Bonnie and Clyde. Clyde (Warren Beatty) uttered those fateful words before he and his bank-robbing girlfriend (Faye Dunaway), were gunned down by a battalion of cops in the Deep South in the 1930's. Not sure what the exact parallels are to timeshare, since the industry's overall economy is improving, sales are up 6 percent and owner approval ratings still hover at 83 percent. But this is pretty close to the Deep South, and it is New Orleans, which is a city very well-known as a place where anything is possible.

This four-day ARDA marathon, running early to late every day, will provide timeshare executives (and wannabes) with about two weeks of information on all timeshare subjects, including how to reinvent sales to capture new customers, to closing down a legacy resort that is running on fumes (and delinquencies). There will be some keynote presentations from business celebrities expert at motivating next-gen sales people, meet-and-greet networking events for the passing of business cards, as well as several after-hours entertainments for people on expense accounts. But the meat of the event is seminar after seminar on real business issues, such as: the fundamentals of timeshare, re-imagining the sales process, state and federal legislative and regulatory issues, ARDA-ROC's agenda for owners/consumers, managing HOA boards, using technology to reach new travelers, etc.

These are real subjects that would spark the synapses of many timeshare owners, if they were here. But they are not, which underscores a curious irony. ARDA hosts a fancy convention annually for members of the development community, which seems to hold all of the money, profit and cards in timeshare. BUT NO ONE, not NOBODY, hosts an annual educational convention for the 10 million or so timeshare owners in the United States --- and these are the people who paid all the money to the developers in the first place. Moreover, rank and file owners are, in general, the very people who need the most education about what they own, how to use it and, some day, how to get rid of it. Failing that last option, they also need to know what their legal remedies are if things go bad.

These are the kinds of issues, and services, that RedWeek attempts to address every day for owners who want to rent or sell their timeshares. Since ~60 percent of our 2.3 million+ subscribers are NOT timeshare owners, we're also intent on providing usable information that potential owners can use to do research on resorts, rentals, resales, and reputable news information about the industry.

That's what THIS blog is all about. And that's also why we are here, holed up in New Orleans for a few days, avoiding the melodious temptations of Bourbon Street so we can arm owners with useful information.

We do have one piece of maybe useful news for folks who have read our prior posts about Diamond Resorts. Ex-senior VP Frank Goeckel, most recently mentioned in this space as Missing in Action from Diamond Resorts, is back in action at ARDA. While others kept speculating about Frank, we just found him at a hotel restaurant, dining with friends. Fit as a fiddle, far as we could tell.

Now, if you know of any good timeshares to check out in New Orleans, let us know!

Your comments appreciated. We'll be back with more updates soon...

The Diamond Chronicles, Part 2: Controversial Sales Tactics Raise Their Head, Again

2017-02-08T16:58:00.000-08:00

By Jeff Weir, RedWeek's Chief Correspondent

Just when you might have thought things were finally settling down at Diamond Resorts, all hell broke loose all over again as 2016 morphed into the New Year. Here's an update on what's been happening with Diamond since our first installment of the Diamond Chronicles last September. There are three major developments, and they're all related, so we'll present them in chronological order. They cover a span of 37 days.

#1:ARIZONA AG ACCEPTS $800,000 FINE FROM DIAMOND TO SETTLE INVESTIGATION OF ALLEGED CONSUMER FRAUD VIOLATIONS

Two days before Christmas, Arizona Attorney General Mark Brnovich announced the settlement of a long-running investigation into Diamond's business practices. Without admitting wrongdoing (a common phrase in legal settlements), Diamond agreed to pay an $800,000 fine to settle the case, including $650,000 that will be made available as restitution to eligible Diamond owners, and $150,000 in court costs to cover the AG's expenses. Diamond also agreed to offer a "relinquishment" program that allows qualifying owners to return their timeshares to Diamond with no further financial obligations.

But that's just the beginning of the story. As with all things Diamond, the devil is in the details of the AG's case. Here are the highpoints, or lowpoints, as publicly announced by the Arizona AG.

The investigation was prompted by hundreds of consumer complaints about deceptive sales practices, oral misrepresentations, and false statements made during sales presentations. The complaints covered Diamond employees' statements about annual increases in maintenance fees, the availability of resale and buy-back programs, the timeshare resale market, owners' ability to rent their intervals, and member discounts on other travel options (including using points to pay maintenance fees).

The settlement was outlined in a legal document known as an "Assurance of Discontinuance." In lay terms, it sets forth actions that Diamond agrees to abide by to comply with Arizona law and avoid future crackdowns from Arizona regulators.

Here are key snippets (among dozens) from the settlement agreement:

"The Arizona Attorney General's Office alleged that Diamond employees' actions and statements violated the Arizona Consumer Fraud Act."
"Diamond denies that it has violated the ACFA and enters into this [settlement] solely for the purposes of efficient resolution of the matter."
"At times, certain vacation counselors told some consumers that increases to maintenance fees are minimal, when the DRUSC (Diamond’s U.S. Collection) Association is permitted to increase maintenance fees up to 25 percent per year.”
"Some consumers alleged that Diamond failed to honor their requests to cancel the purchase and security agreement within seven calendar days following its execution."
"Some consumers claimed they felt rushed to sign the purchase documents before carefully reviewing them, and that they signed purchase documents with Diamond because they felt it was the only way to extricate themselves from what they perceived as a high-pressure sales situation."
"Certain vacation counselors represented to some consumers, directly or indirectly, that consumers could sell their membership if, at any time, they decided that they no longer wanted their membership. However, some consumers have been unable to sell their membership on the secondary market. Certain other consumers have been unable to give their membership away…"
"At times, certain vacation counselors represented to some consumers that Diamond would buy back their membership within the first two years after purchase if the consumer became dissatisfied, but the purchase documents disclosed that Diamond does not offer a buy-back program."
“The state believes that some of the actions and statements by certain Diamond employees, including vacation counselors, sales managers, and quality assurance officers, constitute deception, deceptive or unfair business practices, fraud, false pretenses, false promises, misrepresentations, or concealment, suppression or omission of material facts in violation of the ACFA."

You get the idea. Many of these types of allegations have dogged Diamond since its inception in 2007, when it bought Sunterra's bankrupt timeshare business. Now under new ownership and new management (by former Starwood executives), Diamond has been trying to put as much distance between itself and the former regime as possible, but leftover issues, such as the Arizona case, keep undermining Diamond’s bid to rebrand the company as a kinder, gentler version of its old self.

If you're interested in reading more, go here for the full account of the AG's case.

As part of the Arizona settlement, Diamond agreed to change or enhance its sales, training, and other business practices to ensure compliance with the ACFA. It also agreed to adopt a host of measures to improve disclosures to potential buyers during sales presentations. In essence, most of the measures amount to assurances that Diamond sales personnel will not make oral promises to buyers that deviate from the language of the purchase contracts. Diamond also promised to have quality assurance officers interview potential buyers prior to signing any contracts to make sure they are aware of the details. Finally, Diamond promised to investigate any complaints of future misconduct within 30 days while launching a Secret Shopper program to monitor its employees' performance.

The restitution-and-relinquishment programs are a new wrinkle in timeshare conflict regulation that will be closely watched nationwide. The Arizona relinquishment program will be available to Diamond buyers who purchased timeshares after 2011 and before Jan. 22, 2017. To be eligible, buyers will also have to file a complaint with the Arizona AG's office within 120 days AFTER an Arizona court formally approves the settlement (this will happen in late April or early May). The relinquishment remedy process is very detailed, so potential participants are advised to consult the Arizona AG for complete filing details. The restitution program, meanwhile, will be administered by the AG's office for owners who have filed complaints with the agency. There is no information, at this early stage, about the amount or volume of restitution payments the state will distribute.

FYI, Diamond plans to roll out a national relinquishment (deed-back) program, called Transitions, later this year. It has been in the works for months and is already being quietly tested, according to Diamond’s public relations firm.

Read more about the Arizona consumer filing requirements.

#2: DIAMOND ANNOUNCES A NATIONAL 'CONSUMER SERVICE' PROGRAM PROMOTING ETHICAL SALES PRACTICES, TRANSPARENCY, ACCOUNTABILITY

On Jan. 23^rd --- exactly 30 days after the Arizona settlement was announced ---Diamond publicly introduced a brand new nationwide ethics program, called Clarity, that would govern future sales practices and provide protections for new and existing Diamond customers. The Diamond press release announcing Clarity included self-serving statements about Diamond's commitment to customers (“we already excel in customer satisfaction, but we are constantly looking for ways to do even better”) and promised future sales experiences that would provide transparency, accountability, and quality assurances for customers.

While not triggered by the Arizona legal settlement, the Clarity program is a natural follow on, since it covers much of the same issues --- but from the company's point of view. It also represents an industry first, since no other company has publicly issued anything close to the ethical promises included in Clarity.

“Diamond’s Clarity consists of a series of operational procedures and enhancements, new training and compliance procedures and protocols, and other consumer-friendly changes to the sales process,” Diamond said. These enhancements will be memorialized in a single document that will be given to potential buyers at the beginning of every sales presentation.

The changes are part of what Diamond calls its new "Promise" to customers. Promise includes four operational programs that may be noticeable at sales presentations.

Diamond will increase training of all sales personnel, including quarterly training exercises, to ensure compliance with sales procedures. Finally, the company will place Consumer Engagement Observers at sales presentations to monitor interactions and provide feedback "to achieve constant improvement."

Michael Flaskey, Diamond's chief operating officer, said Clarity was "revolutionary in its simplicity" and further proof that Diamond is "doubling down on our promise to put our members first. With the launch of Diamond Clarity, we are continuing to improve industry best practices."

The American Resort Development Association (ARDA), the industry's lobbying arm and promoter of industry best practices, praised Diamond for evaluating its sales practices and attempting to enhance the customer experience for members and potential buyers.

Diamond hired a Los Angeles-based public relations firm to promote Clarity's commitment to ethical practices. But, in one of its first actions, the firm rejected RedWeek's request to interview Flaskey. (The mere fact that Diamond is now using an outside PR firm to deal with the news media, however, is a remarkable change for a company that, during the past two years, has been highly inaccessible and defensive when contacted by RedWeek representatives.)

In addition to the press release, Diamond emailed information about Clarity to existing owners (including this reporter). The email reads, in part, "As part of this initiative we will strengthen our existing sales policies and procedures and challenge our competitors to adopt similar policies in an effort to raise industry sales standards across the board."

Here's an example of Diamond’s promise to members who attend future sales presentations: "We will provide clear, concise and consistent information at our presentations so that you can easily decide whether committing to vacation is the right decision for you and your family. You will receive a summary of maintenance fees charged to members of the Collection associations for each loyalty level over the past five years."

View the complete announcement.

On its website, Diamond also promised to fully inform buyers about resale restrictions, using points to pay for travel or maintenance fees, and banking or borrowing points.

As with any major corporate change, Diamond's Clarity program proceed will succeed or fail based upon its execution and, most importantly, its acceptance by Diamond's sales teams. Given Diamond's reputation as one of the most aggressive timeshare sales companies in the business --- and its recent legal issues in Arizona --- the internal adoption issues may prove very challenging.

#3: $1 BILLION CLASS-ACTION LAWSUIT FILED AGAINST DIAMOND ALLEGING ELDERLY ABUSE, FRAUD AND FALSE PROMISES TO BUYERS.

On Jan. 29, a mere six days after Diamond rolled out Clarity, an Arizona couple did what a lot of Diamond owners on RedWeek’s forums have long advocated. Ilona and Lester Thomas Harding, on behalf of themselves and other Diamond owners, filed a $1 billion class-action lawsuit in Nevada’s U.S. District Court, alleging elder abuse among a raft of deceptive sales practices.

The 55-page complaint outlines a litany of supposed malpractices committed by Diamond’s sales people when they upsold the Hardings --- not once, not twice, but five times over three years --- to buy points they could never use.

Their tale starts on Jan. 29, 2013, in Scottsdale, when the Hardings agreed to attend a Diamond dinner that was advertised as a 90-minute update session for people who owned Monarch timeshares. According to the lawsuit, "at or around midnight, after six grueling hours, Diamond was finally able to wear down the Hardings and convince them that they needed to purchase a DRI membership --- Vacations for Life --- to a couple in their 70s."

Diamond sales reps told the Hardings that “their Monarch membership would eventually become useless.” They trusted the agents, then agreed to buy 10,500 Club points in Diamond’s U.S. Collection. They received a credit of $22,812 for surrendering their Monarch membership, but still paid $7,895 out of pocket, plus $319 in closing costs. Their first-year maintenance fees were $1,700.

Shortly after becoming full-fledged members of Diamond’s Club, the Hardings discovered what many other timeshare owners (at any club) have also encountered: they could not get reservations at resorts they wanted in California and Washington.

Despite that disappointment, the Hardings agreed seven months later to attend a second Diamond sales presentation while traveling on DRI points in Orlando. At the August 2013 presentation, Diamond sales reps encouraged them to buy a "Silver Sampler Package" that included some free nights in Hawaii. “Even though the Hardings repeatedly told the DRI sales agents that they were not interested in upgrading, DRI’s sales agents were relentless,” the complaint says.

Several hour later, “the Hardings succumbed to the cumulative sales pressure.” They paid $15,905 to upgrade their membership and get those free Hawaii nights.

In May 2014, the Hardings flew to Hawaii to take advantage of their free lodgings. Upon arrival, they learned that, in order to use the rooms, they would have to attend another mandatory sales update or pay full price for the rooms.

The Hawaii sales agents encouraged the Hardings to get out of the U.S. Collection and upgrade their membership to the Hawaii Collection so they could become "Silver-level" members of Diamond’s travel club. After many hours, "the Hardings broke down" and capitulated. They traded in their U.S. membership and"“paid DRI an additional $10,222 for the purported privilege of joining the Hawaii Collection." As a result of the upgrade, their maintenance fees rose to $2,257.

After heading home, the Hardings discovered, again, that they could not book rooms at their favored resorts in California and Washington. The upgrade did not translate into reservations.

A mere three months later, in August 2014, while traveling in Palm Springs, the Hardings attended another supposedly mandatory owner update because they were not Diamond "Gold-level" members. There, DRI sales agents "convinced the Hardings that they had made a big mistake by joining the Hawaii Collection" because the Hawaii properties had much higher maintenance fees than the U.S. Collection and "was notorious for making special assessments on its members." According to the lawsuit, "DRI then offered the Hardings an opportunity to get out of the Hawaii Collection by once again upgrading their membership and rejoining the U.S. Collection at an even higher and more expensive level than they were at previously."

Despite their prior experiences, the Hardings trusted the sales agents, who represented themselves as licensed real estate brokers "who had a duty to tell the truth and disclose all material facts that a consumer would deem important."

The outcome? The Hardings paid $13,905 to upgrade back to the U.S. Collection.

More than a year later, in December 2015, the Hardings agreed to attend one final sales presentation while staying at Diamond’s Polo Towers in Las Vegas. Nevada. Sales agents offered them a 15,000-point bonus if they upgraded to a full Gold status membership. One benefit of becoming a Gold member, they were told, is that they would never have to attend another sales presentation. After seven hours of allegedly intense pressure, the Hardings agreed to buy the upgrade --- even though they didn’t have the cash to buy it. Diamond offered to finance the purchase. Diamond gave them a $36,120 mortgage (at 12.27 percent interest) and a Barclay credit card to charge the down payment of $5,970. In addition to agreeing to pay $524 per month, over 10 years, for the mortgage, the Hardings saw their maintenance fees increase one more time --- to $5,173.

All told, the Hardings paid Diamond $75,000 for upgrades at five presentations over three years and also surrendered their Monarch membership to Diamond (valued by Diamond at $22,812). But they still couldn't get their preferred reservations.

In January 2016, the Hardings, who live off social security payments and modest savings, ran into a financial wall. They paid their 2016 maintenance fees, but then tried to sell their timeshare points. They contacted "surrender" companies that wanted to charge them thousands of additional dollars. Over time, they discovered that there was no viable resale market for their DRI membership. They also found out, after corresponding with Diamond, that they couldn't even give it away.

“The Hardings finally realized that they had been scammed by DRI,” the lawsuit says.

Months later, after contacting an attorney, the Hardings sent a formal demand letter to DRI on Oct. 11, 2016 to opt-out of the otherwise automatic arbitration provision in their contract. They also demanded a 100 percent refund of all their payments to DRI. Diamond never responded to the demand letter.

The class-action lawsuit claims that Diamond used similar coercive sales tactics to pressure thousands of vulnerable older customers (defined as over 60) to buy Diamond memberships without fully disclosing the risks of ownership, such as the potential inability to make reservations. The Harding's decision to "opt-out" of arbitration is crucial to their legal case, because the arbitration clause bans class-actions and private attorney general actions to resolve contract disputes with Diamond.

Predictably, because of the newness of the lawsuit, Diamond offered no substantive comments about it. The company's PR representative said, "Diamond Resorts is still looking into the facts surrounding the lawsuit. Therefore, it has no comment at this time."

Robert Tarics, one of the Harding’s attorneys, was equally circumspect.

"We are very proud to represent the Hardings and look forward to having our day in court," Tarics said. "We’ll answer any questions once the case is over. However, in general, we hope this case will reform and clean up some of the abuses that exist generally in the timeshare industry."

The Hardings, meanwhile, are trying to make ends meet in Arizona while their potentially landmark case heads to some preliminary hearings on the arbitration clause and the certification of the class. As a result of their experience with Diamond, Tom Harding, 74, has had to forsake retirement and go back to work part-time as an electrical inspector. Mrs. Harding, 76, remains retired from her former work as a licensed substance abuse counselor.

The Harding case, like other class-actions filed before it, faces many legal obstacles, including Diamond's proven penchant for litigation (see our stories on Tahoe Beach and Ski Club for one example of Diamond’s legal muscle).

However, most timeshare cases like this never get near a courtroom. Confidential out-of-court timeshare settlements are much more commonplace. The last timeshare case to go to court, in November 2016, ended with a California jury awarding $20 million in punitive damages to a former Wyndham sales rep who got fired after she blew the whistle on sales tactics she found objectionable. Less than two weeks later, and one-day after the New York Times ran a long story on the case, Wyndham’s longtime CEO was fired.

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RedWeek.com will keep owners posted on all developments in future installments of the Diamond Chronicles.

Tahoe Beach and Ski Club Owners Solidify Control of Board Opposed to Diamond's Potential Takeover of Resort

2016-10-13T09:49:00.001-07:00

SOUTH LAKE TAHOE, CA --- Legacy week owners at Tahoe Beach and Ski Club strengthened their grip on the HOA board in September by electing two longtime owners to succeed directors who had perceived ties to Diamond Resorts, the giant timeshare chain that owns 22 percent of the resort’s intervals.

The showdown vote on Sept. 24 drew more than 300 owners, a turn-away crowd for an annual

The crowd gathered for the annual meeting

membership meeting, with many owners expecting an election-day charge from Diamond representatives to place one or two of their own preferred write-in candidates on the ballot. Instead, Diamond stayed on the sidelines, casting its 1,700-plus voting bloc for legacy owners Bill Costa and Kathleen Montgomery, both of whom promised to keep the resort independent and responsive to the vacation needs of longtime deeded-week owners. Their election creates a 5-0 Board majority opposed to Diamond's bid to gain a voting majority (by gobbling up as many TBSC timeshares as possible).

Last year, when Diamond ran one of its own corporate representatives for the board, senior vice president Frank Goeckel, the resort erected a big white tent to house the proceedings and overflow crowd of 200 owners. This year, they brought in an even bigger tent based upon RSVPs that indicated 350 owners would attend.

Goeckel showed up, as expected, but sat just outside the tent, giving himself a few feet of space from the overwhelmingly anti-Diamond owners in attendance (as well as an easy exit path, if needed).

The proceedings were anxious but generally dignified compared to the rancorous name-calling meeting in 2015. Board President Al Fong and Treasurer Jake Bercu gave impassioned speeches about the need to vote and maintain the independence of the resort (from any corporate buyer). They also bashed Diamond, repeatedly, for past attempts to gain control of the HOA by buying up TBSC intervals. Fong called Diamond a “Trojan Horse” waiting to take over the TBSC beach. Fong and Bercu described Goeckel as a “bully” who tries to intimidate the TBSC board and owners.

“He (Goeckel) is trying to lull you owners to sleep,” Fong told the faithful owners in the tent. “Diamond is the Trojan Horse because they have 1,700 votes to use against you.”

Goeckel made no move to participate in any of it, until, after the vote affirming Costa’s and Montgomery’s election to three-year terms, Board President Fong handed him a microphone to answer a simple question: what are Diamond’s intentions for Tahoe Beach and Ski Club?

Goeckel delivered a 10-minute tutorial about Diamond’s point-based trust system of vacation ownership, then, in response to impatient groans from the audience, conceded that Diamond intends to keep collecting TBSC inventory. In so many words, he said, it’s good business, because Diamond needs to add real inventory to its timeshare trusts in order to sell more points in Diamond’s travel club.

“Our interest here is no different than it’s always been,” Goeckel said. “If we don’t contribute more weeks to the trust, we will eventually sell ourselves out at some time.”

While sitting out this year’s election contest, Goeckel made no promises about his participation next year. Regardless, he’s expected to remain a fixture at the resort because he is Diamond’s designated watchdog to keep an eye on the TBSC Board and other Diamond-related timeshares in the area.

Makes sense. Diamond’s ownership stake at TBSC represents $1 million in annual maintenance fees, monies that are contributing to the resort’s current positive financial health.

Putting the TBSC vote into Perspective

Three years ago, Diamond owned 10 percent of TBSC’s timeshares. Then it bought another 10 percent from Vacation Internationale, a travel-resort company. It also acquired intervals at local foreclosure tax auctions, gradually upping its stake to 22 percent. Those purchases were a red-flag to the TBSC board, which had been warned by financial advisers to avoid an “over-concentration of risk” in having one owner responsible for so much of the HOA’s maintenance fees. That risk now resides with Diamond.

Board President, Al Fong

Rank-and-file TBSC owners, according to what Fong said at the annual meeting, have opposed Diamond’s bid to gain majority voting control of the HOA board for very personal reasons: they don’t want to lose their reservation rights at their home resort and, more importantly, they don’t want to be dictated to, or managed, by Diamond. Thirdly, they don’t want to be pressured by Diamond to relinquish their weeks or buy into Diamond’s very aggressive sales machine.

FYI, Diamond owns a very nice, and much larger, resort right next door. Diamond’s Lake Tahoe Vacation Resort is one of the best in its network, but it has no private beachfront. The Tahoe Beach and Ski Club, in contrast, has a spectacular, private 400-foot Lake Tahoe beachfront that is the envy of many Tahoe resorts. TBSC also has many longtime deeded-week owners who have bought multiple weeks to maintain their ability to enjoy the resort during the primetime summer weeks. They fear those privileges will all go away if Diamond somehow gains control of their board.

Diamond’s Lawsuit Against Board goes to Mediation Oct. 20th

Another relevant detail: Diamond is currently suing three members of the TBSC board for refusing to recognize Diamond’s purchase of 245.5 Association-owned timeshare intervals in December 2014. Diamond is NOT suing the other two members of the then-board because they supported Diamond’s purchase. Those two board members, FYI, Shannon Krutz and Steve Williams, were replaced by Costa and Montgomery at the Sept. 24 election.

The TBSC board rejected Diamond’s bloc purchase because it was not authorized, in advance, by the board. The board majority learned later, after the fact, that the purchase purportedly had been validated by Krutz, who had an affiliation with the club’s former management company, VRI, that brokered the sale.

VRI’s contract renewal with TBSC was terminated prior to the disputed transaction. Krutz has not appeared onsite at TBSC for months (in all likelihood, because she is a key part of the Diamond vs. TBSC litigation). A judge presiding over that lawsuit has already opined that the transaction will not be upheld, and that Diamond would lose at trial.

The case goes to mediation on Oct. 20. Mediation works if both parties agree to abide by the outcome. It’s a precursor to a trial on the merits.

So it continues to be a tangled web at TBSC, which represents, in the bigger picture, a legacy resort’s attempt to stave off a threatened takeover by a giant timeshare company. Diamond has never said, publicly, that it intends to acquire a controlling interest in TBSC. But it is an acquisitive company that continues to add inventory to its network. In the past year, for example, Diamond bought Gold Key Resorts (with six resorts) and Intrawest Resort Club (nine resorts). That’s the business model.

One Final Threat Before the Vote

Two hours before the Sept. 24 board election, Goeckel informed the HOA board that Diamond would

Mary Ann Gutierrez, owner activist

dispute the election results if the Board did not retract votes attributed to association-owned inventory (not including the 245.5 that relate to Diamond’s 2015 lawsuit). The board declined to retract the votes.

Final tally: Costa and Montgomery, the board's preferred candidates, won unanimous seats on the board with more than 3,900 votes apiece. If you deduct Diamond’s 1,700-plus voting bloc from the total, the approximate tally was:

Costa 2200
Montgomery 2200
Diamond 1700

Next year, board member Sedric Ketchum is up for re-election. When he won his first term, his margin of victory was 23 votes, with Diamond throwing all of its voting power against him. Stay tuned.

After the vote, RedWeek asked Goeckel if he had any comments about the proceedings.

“I have absolutely nothing to say to you. You are not authorized….”

Not sure what the “authorized” comment meant, but if we find out, we’ll inform you.

Goeckel and Diamond’s public relations department did not respond to email requests for additional comment after the election. That is their standard operating procedure.

This post was written by Jeff Weir, RedWeek’s chief correspondent. He is also a Diamond timeshare owner.

The Diamond Chronicles: Life in the Fast Lane, Timeshare Version

2016-09-22T10:02:00.001-07:00

By Jeff Weir
Chief Correspondent for RedWeek.com

This is the first of what may be several columns on the changes afoot at Diamond Resorts International, which was just bought out by a huge Wall Street investment firm, Apollo Global Management, for $2.2 billion. The merger’s effect on owners is to-be-determined, which is why we are going to report on the Diamond Chronicles.

Here is the Back Story

Throughout 2016, Diamond has made a lot of headlines, including a very damaging one on Jan. 22, when the New York Times (following articles published by RedWeek.com, TimeSharing Today and other organizations) published a critical news story about Diamond’s alleged use of high-pressure sales tactics to sign up new or repeat buyers. Predictably, Diamond executives denounced the article. Diamond investors didn’t like it either, as reflected by a large dip in stock price. To stop the bleeding on Wall Street, Diamond issued a letter to investors Jan. 25 that said, in part, that the New York Times article “does not accurately reflect who we are as a company nor how we operate our business.” Diamond did not challenge any specifics in the article or demand a correction or retraction.

The second big thing that made Diamond newsworthy, all year long, was its overall stock performance, which had floated far below its timeshare competitors for many months. So on Feb. 24, while under public pressure from major investors for stronger returns, Diamond’s board of directors announced that it had created a board-level committee to explore all “strategic alternatives” to maximize shareholder value. That announcement, in effect, meant that Diamond was putting itself up for sale --- and Wall Street loved it, pushing Diamond’s stock up from $19.11 per share on Feb. 24 to $23.21 per share on Feb. 25. Four months later, on June 29, Apollo announced that it would buy Diamond for $30.25 per share. That offer amounted to a 26% premium over Diamond’s then-current share price. The merger was consummated Sept. 2. That’s the day that Diamond went dark, transformed from a public company that files quarterly results to investors, to one that is under no obligation to report anything publicly about its business.

But this is not a story about Wall Street. It's about Diamond.

How Do Timeshare Owners Fit into the Apollo-Diamond Merger?

After months of hearing nothing from Diamond about the merger, Diamond timeshare owners got two very friendly Labor Day Weekend emails from the “stay vacationed” company, on Friday, Sept. 2.

The first came from David F. Palmer, Diamond’s president and CEO.

Thirty minutes later, the second arrived from Stephen J. Cloobeck, Diamond’s founder, chairman and former CEO (until Palmer succeeded him in January 2013).

The dual messages announced that “an affiliate of funds managed by affiliates of Apollo Global Management, LLC” had completed its acquisition of Diamond Resorts International for $2.2 billion. That’s right, they said it: “affiliates of... affiliates” bought Diamond.

Cloobeck, the man who peddled “the Meaning of Yes” as a timeshare theme in all of his corporate messaging, said he was “thrilled” by the buyout. Palmer was a bit more restrained, saying he was “pleased.”

No surprise. In reality, they should be ecstatic, because Cloobeck and Palmer are the two biggest beneficiaries of Apollo’s purchase of Diamond’s stock.

According to an Aug. 5 New York Times story that was based on public Securities Exchange Commission stock filings, the Apollo buyout was worth $384 million for Cloobeck’s shares and $173 million for Palmer’s. Not bad for one day at the timeshare office.

They weren’t the only big winners. Thirteen other Diamond executives and directors (all major shareholders) stood to share $67 million, according to the SEC filing and the Times story.

So if you’re a Diamond timeshare owner, what does all this seemingly obscene profiteering by corporate executives mean to you? Maybe not much. In his email, Palmer assured all Diamond owners that “this transaction will not impact your membership or ownership and you will continue to enjoy all of the benefits you have come to expect.”

Cloobeck, as is his wont, was much more exuberant. He celebrated Diamond’s sale as a personal victory.

“I am confident that the new owners will be excellent stewards of my legacy,” Cloobeck wrote in an email to owners. “I am also pleased to announce that Apollo offered me a special position to assist them as an advisor, leveraging my expertise in the hospitality sector.”

So, while he counts his millions, Cloobeck also plans to hang around, advising the company on how to make even more money. In an odd way, it’s fitting, because Cloobeck’s over-the-top personality has set the tone for Diamond since it bought out Sunterra’s timeshare assets in 2007.

Whenever I Think of Diamond, I See Cloobeck

Back in 2012, Cloobeck participated in a couple episodes of Undercover Boss, the semi-popular CBS-TV show about executives who masquerade as regular employees in order to find out what is “really going on” at their companies.

Cloobeck's appearance on the semi-reality show was notable because he managed to turn his episodes into an unintended comedy, disguising himself in an ill-fitting wig, baseball hat and glasses while posing as a not-too-smart handyman. Since a camera man and sound person followed him around various resorts while the episodes were filmed, it’s unlikely that Diamond employees had much doubt about who the guy-in-the-wig was. Still, when the episodes ended, he graciously thanked the employees who put up with his phony handyman and gave them hugs and lots of money. (See what RedWeek members have to say about the episode here)

Rank-and-file Diamond employees already knew who he was, of course, because during his reign as CEO Cloobeck made himself a ubiquitous presence at Diamond resorts. According to staff, he had a habit of popping in, unannounced, at various resorts to see what employees were doing. For several years, he and his marketing team also liked to feature videos of Cloobeck, talking about how wonderful “the Meaning of Yes” was to Diamond owners, on continuous-loop, large-screen TVs mounted on the lobby walls at Diamond resorts. At check in, you could not escape him. In the TV video, he looked every part the timeshare salesman that he is: expensive coat, pressed jeans, white open collar shirt, gold chains, big watch, vivid tan, brilliant white teeth, perfect pompadour, all topped by a tone of self-satisfaction as Cloobeck held forth from a spectacular beach resort (fancier than anything Diamond owns, FYI). Those videos disappeared, overnight, when Cloobeck was replaced as CEO by Palmer, his longtime executive running mate at Diamond resorts.

From a branding standpoint, the marketing video wasn’t a bad idea. But just like the Undercover Boss episodes, the video seemed to reveal more about Cloobeck than the average timeshare guest might want to know about him (which is, that he’s proud of being rich and happy to share his wonderful life with mere humble timeshare owners). As one might imagine, Diamond’s front-desk people purportedly hated the video, because they could not get away from it.

The last time I stayed at a Diamond resort, I asked the front desk folks, “where’s the Cloobeck video.” They laughed out loud, then confessed, “locked in the general manager’s safe.” Never to air again.

In a semi-recent YouTube interview about his Undercover Boss appearances, Cloobeck told an interviewer that he initially balked at doing the show “because I was afraid of tarnishing the brand.” Still, he was obviously proud of the whole adventure. Later, when asked about Diamond’s philanthropic programs for charitable causes, Cloobeck beamed, “I’ve always been a great philanthropist.”

After the second Undercover Boss episode aired, Cloobeck decided to put his money where his mouth was. “I wanted to do something special for our team worldwide. I donated $1 million, matched by the company, for a $2 million fund for team members that need help,” Cloobeck told the interviewer.

Diamond timeshare owners should like that bit of philanthropy, since they paid for it with their purchases, mortgages and maintenance fees.

I only met Cloobeck once, but it was a total goof and probably did not even register with him. I was attending an industry conference in Las Vegas, hanging outside the media room while CEOs attended a private session next door to talk about high-level (i.e., secret) timeshare issues. Suddenly, there was a flurry of movement. It was the unmistakable Stephen Cloobeck, larger than life, decked out in golf shirt and shorts, swaggering through the lobby with a cigar in hand and accompanied by a big, beefy, bald-headed bodyguard (a very big version of Kojak, for those who remember Telly Savalas) who cut a swath for Cloobeck through the curious folks in the lobby. Compared to the other CEOs who were dressed like bankers, it was a classic Cloobeck entrance. Arrive late, act like you just left the golf course (which he had), then leave early. I tried to introduce myself to Cloobeck, without slowing him down, but desisted when the bodyguard started twitching at me while his gold earring bobbed like a fish hook. The pockets of his business suit bulged, too. Regardless, it was a great moment: short, sweet, unforgettable Cloobeck.

Inspired by what I'd seen, the next day I called Diamond’s corporate office in Las Vegas to see if I could arrange an interview with Cloobeck while I was in town. Seemed like a pretty automatic thing to do. He seemed much more interesting than many CEOs I’ve met and was obviously living life as a self-styled timeshare celebrity, so why not? Good idea to see him in his lair for a feature story just like this.

That was three years ago. I’m still waiting for the call back.

Out with the Public Company, In with the Private Company

So now it’s time for all timeshare owners to say goodbye to the Old Diamond, and hello to the New Diamond. While both Cloobeck and Palmer promised in their emails that nothing would change as a result of the merger, that is not realistic. Business people outside Diamond’s inner circle say there are always big changes when one company takes over another. There are many winners and losers, including the people who get hired or fired as a result of Apollo’s integration of Diamond into its many-affiliate universe of companies. After all, Apollo did not buy Diamond to keep everything the same. Apollo bought Diamond, which has been hugely profitable for 12 quarters in a row, to make even more money. More importantly, now that it will operate as a private company, Diamond has no legal obligation to file quarterly reports about earnings or annual reports. Here’s what that means: barring voluntary announcements or web postings from Diamond, timeshare owners will have no easy to way to find out what’s going on with their timeshare company. You’ll only learn what they want you to know.

Will reservations get easier? Will owners ever be able to sell their Diamond Club points on the resale market? Will Diamond take them back? Stay tuned.

FYI, we asked Diamond’s PR team to arrange an interview with Palmer to talk about these issues, but they have not responded. We will keep you posted if they do!

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Full Disclosure: In addition to being a reporter who covers timeshare issues, I am a longtime Sunterra/Diamond owner who has had generally positive experiences using my legacy weeks. Even though I have stubbornly refused to convert them to points, Diamond still comes after me, every six months, to become a full-fledged member, rather than an orphan, of The Club. I don't mind. Diamond has pretty likeable employees. Their solicitations are always challenging.

I have also covered Diamond's showdown with Lake Tahoe Beach & Ski Club extensively.

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For more info on Diamond's financial performance, see Diamond’s last quarterly earnings announcement, published Aug. 6, 2016.

Let us know what you think! Leave your comments below to continue this conversation.

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NOTE: The views expressed here are the author's own, and do not necessarily reflect or represent the opinions of RedWeek.com or its affiliates.

Marriott Vacation Club Expands Footprint in Hawaii with New Timeshare on Big Island

2016-09-07T15:45:00.000-07:00

Marriott Vacation Club just announced a new travel option for people who like the Marriott timeshare experience and, most importantly, vacationing on the Big Island in Hawaii.

On Sept. 7, MVC announced the opening --- next May --- of its newest Hawaiian resort, the 112-unit Waikoloa Ocean Club, a one- and two-bedroom suite complex which will be co-located on the island of Hawaii with Marriott's existing Waikoloa Beach Marriott Resort & Spa. It represents Marriott's newest “mixed use” property where hotel and timeshare guests share the same facilities and amenities.

"The Big Island has been the only Hawaiian island missing from our resort portfolio," said Stephen P. Weisz, president and CEO of Marriott Vacations Worldwide. "We are excited that our owners and guests will get to experience its diverse landscape and rich culture."

That landscape includes black sand beaches and Kilauea, one of the world's most active volcanoes, which spits fumes and smoke daily and, since the 1983, sends hot lava tubes down the mountain into the ocean. Hawaii Volcanoes National Park is a must-see day trip from the Waikoloa area, but it's not the only attraction for visitors. The Big Island is easy to navigate by car and full of wide open spaces with a population of 175,000 people (compared to Oahu's 905,000, Maui’s 131,000 and Kauai's 63,000). The resort areas in Waikoloa and along the Kona Coast are just as spectacular as any resorts on the other islands --- but they offer more rocky coasts and fewer beaches than, say, Maui. If you like to see molten magma, up close and personal, this is the only place to find it in Hawaii.

Marriott owners can call owner services immediately to start booking reservations, starting May 5, 2017, as part of Marriott's Destinations Exchange program (meaning, using Destination Club points to book stays). Between now and then, Marriott will continue upgrading the grounds and rooms to make sure the new timeshare resort --- which is a conversion of part of the existing property, similar in scope to Marriott's Kauai Beach Club conversion --- lives up to the standards Marriott has already tried to create at its five other Hawaii-based timeshares in Oahu, Maui and Kauai. Significantly, the company has already added a sales gallery to the complex for future timeshare presentations. As with the other Marriott timeshare resorts in Hawaii, the complex will offer everything visitors might want to do --- from beaches and golf courses to spas and restaurants, all within walking distance.

The Big Island is just that, nearly twice as big as all the other Hawaiian islands combined. It offers 10 of the world's 14 different climate zones due to the massive elevations of its most famous volcanoes: Maunakea is the tallest sea-mountain in the world --- bigger than Mt. Everest; Maunaloa is the world’s most massive mountain and covers half of the island. While big and rugged, the Big Island is also a baby, since it’s the youngest island in the Hawaii chain at 800,000 years old.

RedWeek subscribers can sign-up to be notified when new Waikoloa Ocean Club timeshare rentals and resales are made available.

Additional resources:

Marriott Vacation Club Resort Directory
About the Big Island

Don’t Forget to Take Your Vacation!

2016-05-04T10:50:00.000-07:00

It’s that time of year again - springtime! The weather is starting to get warmer (or at least getting better!), and our thoughts turn to vacation planning. There's been much research done, and many articles written on the value of taking a vacation and its beneficial effects on work performance, relationships and overall well-being.

Unfortunately, many of us are not taking their vacation time. The U.S. Travel Association says 6 in 10 organizations report employees fail to use 3+ days of paid vacation each year. In case you were thinking of not using your vacation time this year, here’s a quick review of why you should.

Vacationing improves health and well-being

It reduces stress and improves your health (maybe even preventing heart disease according to one study), makes us happier and more relaxed.

After vacationing the effects at work are dramatic

It helps to prevent burn-out and enhances productivity and creativity, increases job satisfaction, and probably helps you to get along better with co-workers.

Vacationing improves relationships with family and friends

Quality time spent with family and friends without distractions is priceless. The results are better relationships, the strengthening of family bonds, and the making of positive, lasting memories. You may even find out a few things you didn’t know about the other person!

Even Planning a Vacation Makes You Happier

A 2010 study by Dutch researchers, found that just planning a vacation boosts happiness. When you start to look at places you’d like to visit and all the things you want to do, it builds excitement and gives you something to look forward to. Include your spouse and children in the planning process to make everyone feel a part of the adventure.

Make Your Vacation Even More Valuable

You know how good it makes us feel to do something for someone else - to feel that we've made a positive difference. Many people are doing that by turning their vacation into a volunteer experience. Whether domestically or internationally, you can use your passions and skills to help build a house, teach a language, support children, get involved in a conservation or ecological project, provide health and agricultural support. There are several agencies that can team you with a project and a particular country. Not only are you giving to others, it’s a great way to see the world, understand the country and experience a culture unlike your own.

Owners at Legacy Timeshare Resort in Lake Tahoe Deny Diamond's Bid to Gain a Majority Seat on the HOA Board

2015-10-19T09:06:00.001-07:00

By Jeff Weir

In a stunning setback for Diamond Resorts, timeshare owners at Tahoe Beach and Ski Club defiantly denied Diamond Resort International's bid to place a senior vice president on the HOA's board of directors. Instead, they reelected two board members who constitute a 3-2 majority opposed to Diamond's unannounced plans for the resort.

Frank Goeckel's defeat was a first on many fronts. He is Diamond's liaison and board relations consultant to 31 resorts and currently serves on four timeshare HOAs, including the nearby Tahoe Seasons resort. All he wanted to do, he told owners repeatedly, was serve on the board to protect Diamond's investment in Tahoe Beach and Ski Club and create a richer vacation experience for all owners. Diamond's investment is substantial: it has aggressively bought Tahoe Beach and Ski Club units at tax sales during the past two years and now owns 25% of all Tahoe Beach and Ski Club timeshares. To many outsiders, Diamond's ownership (including $1 million in maintenance fees this year alone), is viewed as a very positive key to the legacy resort's long-term financial survival.

But the 200 owners who assembled on the Tahoe Beach and Ski Club beach for the HOA election on Sept. 26 did not embrace Goeckel's pitch, or his sometimes combative personality. He finished a distant third out of four candidates, collecting 1,719 votes, including 1,604 he cast for himself as Diamond's proxy holder. In their rejection of Goeckel, Tahoe Beach and Ski Club owners voted to maintain their resort's independence in the face of a company with very acquisitive designs on older but valuable resorts across the country.

Jake Bercu and Alfred Fong after their reelection

Bad as the results were personally for Goeckel, the HOA vote was a triumphant victory for President Alfred Fong and Treasurer Jake Bercu, who were reelected to new terms on the strength of their campaign pitch that Goeckel, and co-challenger Cathy Ryan were bad for the board and bad for the resort. In effect, they portrayed Goeckel as a Trojan Horse whose ascension to the board would enable Diamond, over time, to take over the resort at the expense of longtime deeded week owners. Citing Diamond's and Goeckel's record at other Diamond resorts, Bercu-and-Fong supporters at the HOA meeting predicted that Diamond would increase maintenance fees, open up the resort's coveted private beach to non-owners, and pressure longtime owners to convert their deeded weeks into Diamond's point-based travel club.

Many owners also distrust Diamond's motives because of Diamond's decision, last February, to sue the current board for its refusal to recognize Diamond's purchase of 241.5 vacation units last December. As one irate owner pointed out at the HOA meeting, "Did you know you're being sued by this man? He [Goeckel] wants your vote!"

The candidate's forum at the HOA meeting was rancorous. The candidates aggressively challenged each other while members of the audience heckled Goeckel and complained about Diamond's corporate behavior at other resorts. Bercu and Fong beseeched owners to protect their vacation experiences and preserve the spirit of the resort by rejecting Goeckel and Ryan. Goeckel vowed that he would never open up Tahoe Beach and Ski Club's private beach to Diamond owners at the Lake Tahoe Vacation Resort, located right next door, but with no beach of its own. Ryan, a bit player in the drama, said she just wanted to work with all owners and improve the financial stability of the 140-unit resort.

200 Tahoe Beach and Ski Club owners gather for the vote

Goeckel answered every accusatory charge (and boos) from owners with as much reasonableness as he could muster. But he was also obviously upset at the hostility he absorbed from Tahoe Beach and Ski Club owners at the candidates' forum. He even told a story about how his wife and children, at home in Florida, got hateful and threatening phone calls from owners at The Point in Poipu, a Diamond resort on Kauai that went through an owner class-action lawsuit several years ago (over a $6,000 one-time assessment to repair ocean-water damages). The case was eventually settled --- with Goeckel calling the experience one of his proudest achievements as a board member at Poipu --- but still left a bad aftertaste among many Poipu owners. To this day, they complain loudly, and bitterly, on online forums (including this one on RedWeek.com) about their alleged mistreatment from Diamond.

Unlike Poipu, the HOA election at Tahoe Beach and Ski Club ended peacefully, with all candidates retreating to the best wishes of their supporters while owners milled around, excited and nervous, about whatever history they were about to make. An hour later, they found out.
With two seats open on the board, the referendum on Diamond's investment in Tahoe Beach and Ski Club was:

Bercu, 2,217 votes
Fong, 2,207.5
Goeckel, 1,719 (including Diamond's 1,604)
Ryan, 1,624.5 (including Diamond's 1,604)

Saturday Night Pizza Party Puts the Vote into Perspective

The night before the election, Goeckel probably knew what was coming. He had dinner, by himself, at the end of a long bar at the Pizza Hut located right next door to the Tahoe Beach and Ski Club. His only visitor was a reporter who stopped by to say hello and engage in small talk. Goeckel was not in the mood for pleasantries. In response to several questions, he just stared back, stone-faced, like he was looking through a mirror.

While Goeckel munched on his lonely pepperoni, 50 or so Tahoe Beach and Ski Club owners held a pre-election party in a dining room just 20 yards away. With college football game TVs blaring overhead, they didn't know Goeckel was in the same room, and they didn't care. They were celebrating an owner-movement in its infancy: people taking charge of their timeshare destinies by getting involved in mundane things like HOA elections. For these folks, getting involved felt good --- very, very good.

Diamond Resorts' Goeckel takes the mic

Compared to the newby activist owners, Goeckel's been deeply involved in timeshare issues for 25 years. He has more board member experience than all of the Tahoe Beach and Ski Club members, combined. He also serves on the board for the American Resort Development Association and its owner-affiliate, ARDA's Resort Owners Coalition. But Goeckel, despite a resume that spans six pages, hit a rocky speedbump at Tahoe Beach and Ski Club. Owners, including other board members, routinely refer to him as a 'bully.' Goeckel claims to be baffled by all the hostility he's received from owners at Tahoe Beach and Ski Club, but he knows the truth of the situation. Bottom line: the owners that know him don't like him or his company.

The enmity is understandable. At an owners' meeting on the beach a month ago, Goeckel matter-of-factly told owners that if he did not get elected to the board this year, he'd get elected NEXT year. Diamond, he said, "is not going anywhere."

Owner Activism in Tahoe Starts a Movement?

The showdown on the beach at Lake Tahoe beach illustrates, in one isolated case, what can happen when legacy resort owners communicate and get organized to defend their perceived interests. It also opens a window into how major companies view the future of timeshare --- where big companies gobble up units at smaller resorts in high-value destinations like Lake Tahoe. It seems to be a natural part of the ongoing consolidation of the industry where big companies survive and smaller independent timeshares teeter on the brink of insolvency as owners age-out and go delinquent on their maintenance fees.

Across the country, a similar owners' rebellion sparked a civil and criminal investigation of The Manhattan Club timeshare resort by New York Attorney General Eric Schneiderman. As part of that investigation, Schneiderman obtained a court order in 2014 that terminated all sales at the club and froze the company's assets.

But those kinds of moments are few and far between. Most timeshare owners are concerned about their reservations and vacations, not the people who run their resorts.

In the aftermath of the vote, as the calm waters of Lake Tahoe lapped quietly at Tahoe Beach and Ski Club's private beach, Bercu and Fong were proudly optimistic about the challenges that still must be addressed --- Diamond's lawsuit, dealing with delinquencies and launching a new resale program to put foreclosed units back into circulation --- and creating revenues.

They also have to prepare for another election, next September, when two other board members, Steve Williams and Shannon Krutz, who back Goeckel, stand for reelection. The board has already asked Krutz to resign because of her role in approving Diamond's purchase of Tahoe Beach and Ski Club timeshares last December (without board approval), but she has not responded. Other owners, full of energy from their victory in reelecting Fong and Bercu, are openly debating whether to launch a recall election, immediately, to unseat Krutz. So the situation remains fluid, despite the election.
Bercu says that Goeckel, communicating with other board members through back channels, has already agreed to engineer Krutz's resignation --- in return for his getting an appointment to serve out her term.

Diamond's Lake Tahoe Vacation Resort behind TBSC

It's a risky proposition, since owners have already spoken about their position about Goeckel.
"Diamond is still trying to buy our inventory, so we don't want Goeckel on the board," Bercu said. Krutz declined to comment.

Goeckel also sidestepped comment after the HOA vote. In an email, he said, "I am unable to comment on issues relating to the pending litigation at Tahoe Beach & Ski Club in South Lake Tahoe, California."

Like all litigation, Diamond's lawsuit against Tahoe Beach and Ski Club will have a life of its own. The next status conference before a local judge is tentatively set for mid-November. That judge has already opined that Diamond will lose the case because Krutz had no authority to authorize the sale on behalf of the board. The Tahoe Beach and Ski Club board is actively fighting the case and, in a recent maneuver, filed a countersuit against Diamond and VRI, the club's former management company, over the December sale.

So what will happen next?

"The owners want more blood," Bercu said. "They are feeling empowered. We want to keep them engaged but channel the energy into something positive."

RedWeek's Casting Call Visits Hilton Head!

2015-08-25T10:50:00.000-07:00

RedWeek's latest Casting Call features long-time RedWeek members Michelle and Bill at Marriott's Barony Beach Club on the beautiful Hilton Head Island! Featuring vibrant work by Hilton Head Island-based Kellie McCann, these photos truly capture the laidback, beachy spirit of Hilton Head. Check out more of the photoshoot on our exclusive Facebook album, and you can view more of Kellie's work and book a session of your own on her Web site!

Don't forget that RedWeek's Casting Call has been reopened! If you're traveling to a timeshare resort in the next few months and are willing to work with a professional photographer, check out the details and apply here. You'll receive all of the digital photos from the shoot, a $50.00 printing certificate and you'll be featured on the RedWeek homepage for all of our 2 million+ registered users to see! Casting Call registration closes on December 31st of this year, so be sure to enter as soon as possible.

Exclusive Photography Opportunity for RedWeek Members!

2015-07-20T10:50:00.000-07:00

Looking to travel to Orlando soon? We've partnered up with an Orlando-based photographer to offer a special deal to RedWeek members who are planning a vacation in the area.

For $350.00, you'll receive an hour-long session and over 30 professionally edited digital photos - a $50 savings compared to standard pricing. On top of that, RedWeek has a special offer of our own - for the first ten participants, we will match the discount and $50 back to you if you let us use your photos and a quote on the RedWeek website. A great deal and RedWeek fame - what's not to love?

To see if you qualify and get started, contact us with the details of your trip, including your dates, where you're staying and how you booked. We'll be back in touch to let you know if you qualify and the next steps. In the meantime, check out some of the photos from our photographer's previous shoot with RedWeek members Gillian and Trevor for an idea of what you can expect on our Facebook page!

Manhattan Club Case Approaches One-Year Anniversary with No End in Sight

2015-06-10T09:24:00.001-07:00

The Developers Fight Back: Seek a Court Hearing June 22 to Partially Lift Injunction and Dismiss Eichners from Case, Claiming that Investigation by New York Attorney General has "Essentially Destroyed" Timeshare Business

By Jeff Weir, Chief Correspondent for RedWeek.com

MANHATTAN --- If you like heavyweight fights, shootouts in old Westerns, or bare-knuckle courtroom dramas, you should covet this upcoming showdown in the Big Apple.

And if you are a timeshare owner at The Manhattan Club, this is what you've been waiting for.

After laying low and saying nothing of substance for many months, the embattled developers of the Manhattan Club are fighting back, with a vengeance, against New York Attorney General Eric Schneiderman's highly publicized investigation of alleged fraud and misrepresentation in timeshare sales at the mid-town resort. The primary target of the inquiry, New York developer Ian Bruce Eichner and his wife, Leslie, and brother, Stuart, now claim in court papers that they are victims of an "overbroad" and overlong investigation that has "caused severe financial and reputational harm." That's a lawyerly way of saying the case has already cost them millions and damaged their
reputations.

"The Attorney General's investigation ad infinitum has become an investigation ad absurdum," said Gerald Shargel, the Eichners' lead attorney, in a new court filing. During an interview with RedWeek over the weekend, the soft-spoken but defiant Shargel added: "There comes a time when this has to stop. If they have a case against the Eichners, file it, and you can count on the fact that we will defend it."

In a blistering blizzard of motions and memoranda filed since May 28, Shargel is petitioning the New York Supreme Court to jettison parts of the July 29, 2014 injunction that shut down the club's $400 million timeshare business and threw thousands of owners into limbo and turmoil. The court order also froze the club's assets and blocked foreclosures, which pinched the club's operating capital. A hearing on the motions and arguments is scheduled for June 22. But given the history of the case,
postponements are possible.

Eichner's legal team is making four basic requests, including one that will probably make many Manhattan Club owners cringe. First, they want a judge to dismiss the Eichners from the case on grounds they committed no personal wrongdoing. Second, they want to lift the ban on sales for 21 buyers (out of 64) whose purchases were halted by last July's court order. Third, they want an Aug. 1, 2015 cut-off date for further discovery and depositions (legal Q and A interviews conducted under oath). Finally, Eichner's attorneys are asking the court to prohibit the AG from sending "mass mailings" to Manhattan Club owners (for a survey about their experiences at the club).

"The Attorney General's investigation...and the related preliminary injunction have essentially destroyed the Manhattan Club's ability to operate as a viable business. They have forced the termination of 90 of 93 employees and independent contractors (97 percent of the staff) and have pushed one of New York City's premier timeshare organizations into an almost-insurmountable financial deficit," Eichner's motion stated.

It did not take long for the AG's office to respond in kind. "Although the investigation is ongoing, to-date we have found evidence indicating a widespread pattern of wrongdoing including but not limited to sales misrepresentations, numerous practices that violate the terms of the Manhattan Club's statutorily-required offering plan, the failure to properly register as broker-dealers of securities, and the misclassification of employees." This summary of the investigation comes from one of New York's top timeshare regulators, Andrew H. Meier, deputy bureau chief for the AG's Real Estate Finance Bureau, in a June 5 letter to Justice Jeffrey K. Oing.

The outcome of this slugfest will impact the vacations, and pocketbooks, of thousands of Manhattan Club timeshare owners. Maybe a political career or two, as well, since Schneiderman, a Democrat, is frequently mentioned in the media as a likely candidate to challenge Gov. Mario Cuomo in 2018.

Welcome to the OK Corral of Timeshare Legal Disputes

The Manhattan Club case is a painful example of things gone wrong in the timeshare industry, which relies on high-pressure sales tactics, including first-day discounts, incentives and gifts (shows and meals) to persuade customers to buy weeks or points in vacation clubs. In this case, however, the overall buyer experience soured when hundreds of owners started complaining publicly, including in RedWeek.com forums, that they could not get reservations to use their high-value timeshares. Instead, they discovered that many intervals were simultaneously available for rent online to non-
owners --- and at prices that were LOWER than their annual maintenance fees, which
average $2,000 or more per unit.

Schneiderman's office started investigating the club two years ago --- cautiously at first, aggressively in the last year --- after receiving more than 100 formal complaints from owners who said, in effect, that they had been defrauded and/or duped into buying expensive timeshares they could not use.

By July 2014, Schneiderman's team had collected enough potential evidence, including undercover video-taped transcripts of wildly misleading sales presentations at the club, to secure a court order that shuttered the timeshare operation, immediately, while the AG continued investigating the club's sales practices, rental policies and public offering statements.

Now, 11 months later, the investigation has turned into a tortured legal battle pitting some of the smartest lawyers in Manhattan against each other. Eichner's legal team specializes in white collar criminal defense and negotiating complicated business litigation. Schneiderman's team, representing New York taxpayers, appears to have unlimited resources to pursue the Eichners, indefinitely. If someone made a TV crime drama out it, they'd call it "CSI: Manhattan."

Like most TV and real-life dramas, the Manhattan Club investigation is all about following the money. Disgruntled owners want their purchase money back; the AG's Office wants to find out where the club's money is, or went; and the Eichners want to lift an injunction that, for now, prevents the club from using its bank accounts.

In an odd twist --- again, perfect for a reality TV script --- the Eichners claim to be the injured parties of an overzealous investigation from the AG that should never have been approved by a New York judge on July 29, 2014. Their court pleadings are silent, however, on the underlying question --- who are the real victims in this case?

Straight from the Court Files: the Eichners Plead Their Case

Here are excerpts from the Eichners' pleadings, drafted and filed by Shargel's team, as they seek to overturn big chunks of the 11-month-old injunction. Some of the excerpts merit an introduction. Others speak for themselves.

"There was no proper basis for a preliminary injunction. There was no allegation that the three Eichner respondents personally engaged in any wrongful conduct."

"The Attorney General has had ample time to investigate Ian Bruce Eichner, Leslie H. Eichner, Stuart P. Eichner and Urban (the company that manages the Manhattan Club's HOA) after the order was issued. Yet no further action has been taken. Rather, a preliminary injunction remains in place, and the business interests and personal and professional reputations of these respondents continue to (unjustly) suffer.

"Urban" is legal shorthand for New York Urban Ownership Management LLC, which is majority owned by Ian and Leslie Eichner. The company has managed all aspects of the Manhattan Club since its inception.

"The Attorney General's primary allegations relate to a single group of salespeople at the Manhattan Club. Each of the alleged misrepresentations was made by one sales representative and the sales team he supervised. There is no allegation that this alleged course of conduct went beyond that sales team." (The sales person is named in the Eichner pleadings --- which are public documents --- but RedWeek sees no public benefit in publishing the man' name.)

"There is not one drop of evidence, or proof, to suggest the Eichners had any knowledge of that (sales) conduct," Shargel added, when questioned by RedWeek. "You cannot blame the general for the unsupportable conduct of privates that are engaged in conduct not known to the general."

Sixty-four timeshare purchases were under contract but not finalized when the AG's court order terminated all timeshare sales at the club last summer. Forty-three subsequently rescinded their contracts. Purchase deposits from the remaining 21, ($423,793 - an average of $20,180 per timeshare) were put into an escrow account. These owners, while aware and informed of the AG's investigation, have chosen to keep their Manhattan Club timeshares. As a result, the Eichners are asking the court to allow those sales to proceed. Just as important, they also want permission to use the money from those sales, including deposits and maintenance fees, to fund ongoing operations at the club (including, presumably, the legal fees for this case).

The Eichner pleadings about discovery limits and mass mailings are straightforward but strange. They're also related. "On May 19, 2015, the Attorney General demonstrated that the reasonable and productive lifespan of its investigation has reached an end. On that date, the Attorney General caused a mass-mailing email to be sent to hundreds of current and former Manhattan Club timeshare owners from a company named 'SurveyMonkey.' The email contained a link to a customer satisfaction survey with 36 suggestive questions clearly intended to provoke after-the-fact complaints from owners."

"The Attorney General's reliance on 'SurveyMonkey' to build a case that has already consumed nearly a year demonstrates that this case will clearly drag on into the indefinite future and beyond any reasonable bounds...Many of the questions, taken together, were structured to suggest that a recipient may have been the victim of fraudulent sales practices by the Manhattan Club...This is not an appropriate or effective method for New York State's highest law enforcement agency to gather information. We intend to move at an appropriate time (if necessary) to exclude the results of the Attorney General's SurveyMonkey and any leads generated by the survey."

Shargel, in his interview with RedWeek, said the AG's questionnaire to owners is full of leading questions that would not stand up in court. "They are just flailing around trying to make a case out of no case," he said.

In addition to challenging the AG's communications with owners --- many of whom had voiced frustrations, for months, about their inability to get direct information from the AG about the investigation --- Eichner's legal papers shed light on the raging financial successes of the Club's timeshare operation.

"Before the order was issued in this case, the Manhattan Club and the Timeshare Association had enjoyed 17 years of success. Between 1997 and 2014, the Manhattan Club realized a sales total of approximately $400,000,000...Since the order was issued...lost revenue opportunities are estimated in the tens of millions of dollars."

The AG's Not Talking, But Others Are, Including Owner Advocates

Representatives from the Attorney General's Office declined to talk about the case, choosing, instead, to let their own voluminous court filings speak for themselves. Other interested parties, however, are not so reticent. Owner forums on RedWeek.com and other online discussion groups are on fire with generally hostile commentaries about the club's owner services and reservation problems, the Eichners, escalating maintenance fees and, in some cases, the AG's office (over the pace of the inquiry).

Douglas F. Wasser, a New York attorney hired by a group of Manhattan Club owners to work directly with the AG's office, scoffed at the Eichners' attempt to get themselves out of the case.

"I can't imagine that the court will take this seriously," Wasser said. "The subjects of an investigation by the New York Attorney General should not get to dictate the scope, length and people subject to the investigation. The law doesn't work that way."

Warming up to the subject, Wasser added: "Eichner's attoneys may brag in their memo of law that over $400 million in TMC units have been sold to the public between 1997 and 2014. But we simply view that assertion as an admission that $400 million in publicly owned equity has been wiped out by TMC operations. What purpose does the New York Attorney General serve but to police against such a grievous public harm?

"The sheer number of TMC owners who, prior to the New York Attorney General's current proceeding, tried to simply surrender their units to TMC for little or no money begs the question as to the current value of TMC units," Wasser said.

Greg Crist, CEO of the National Timeshare Owners Association, has monitored the case for many months, and written about it in trade publications. While aware of the details of the investigation, he'd rather focus on its significance for owners and the overall industry.

"I don't want to see another Manhattan Club scenario anywhere," said Crist. "This case is quite unusual, but it does not bode well for the good operators in the industry, ecause it disturbs consumer confidence about the industry's sales practices. Fortunately, there's no real pattern to this kind of activity."

Shargel, for now, gets the last word.

"We look forward to a hearing," Shargel said. "The discovery is substantially complete. We have no more to give them. The Eichners did not engage in any acts of wrongdoing. There is no case against the Eichners. If they (the AG) think the resolution here is to bring a complaint, then bring it. But I am frustrated, because this should come to an end. At some point, this has to end."

One thing is certain. Barring a miraculous change in strategy and tactics, the case will go on. Beyond the June 22nd court hearing, both sides have already agreed to participate in another private status conference on July 10. So it goes.

---
Interested in following this case? Visit RedWeek.com for much more information on the Manhattan Club investigation and how you can get involved.

Is North or South Tahoe Right for You?

2015-06-01T10:50:00.000-07:00

If you're looking for a destination that offers a bit of everything, look no further than Lake Tahoe. Whether you're looking for outdoor activities, water sports, a strong cultural scene, vibrant nightlife, gourmet dining or just a beautiful retreat, Lake Tahoe is not easily beat. However, planning a trip does take a bit of research and some decisions. The first question on any Tahoe-seasoned traveler's lips will be "North Shore or South Shore?".

Lake Tahoe lies cleanly between California and Nevada, the state border running directly through the center of the lake. While both states have communities and resorts in North and South Shore, the North Shore is often considered the Californian side while South Shore is primarily associated with Nevada. Even though both halves of Lake Tahoe boast beautiful views and many of the same activities, the North and South Shores have taken on clear identities of their own. Knowing the differences between the two are paramount to having an enjoyable vacation that fits your needs.

The bigger communities in South Shore are South Lake Tahoe, Meyers, Stateline, Zephyr Cove, Emerald Bay, Kirkwood, Homewood, Tahoma and the Heavenly ski resort. Between the two sides, South Shore tends to be a bit more crowded and with a distinctly more "tourist-y" scene. For those looking for an exciting and action-packed vacation, South Shore offers much more to "do" - beyond the ski resorts and outdoors, there's countless opportunities for entertainment. Uniquely themed shops, restaurants and spas can be found in abundance. There's also far more of a nightlife along the southern shore - if you're looking to hit the bars, clubs or casinos after dark, than South Shore is definitely your go-to!

It's also worth mentioning that South Shore might be the ideal choice if you're vacationing without a car. Many major attractions are within walking distance of one another and shuttle service is available to many areas. The South Shore also tends to be a bit more popular with families - many of the ski resorts and casinos have licensed daycare services, allowing the adults to have some time on their own to experience all Tahoe has to offer.

North Shore exudes an entirely different vibe - one of relaxation and tranquility. Included along the North Shore are the communities of Tahoe City, Tahoe Vista, Kings Beach, Incline Village, Squaw Valley, Alpine Meadows, Northstar, Diamond Peak, the Mount Rose ski area, Truckee and Donner Lake. The focus here is not on constant excitement, but rather enjoying what nature has to offer. Tahoe's best skiing can be found on the North Shore, as well as the most beautiful nature trails. The relaxed atmosphere has led a different breed of business to flourish - North Shore is your destination if you're looking for upscale spas, gourmet dining, boutique shopping and museums.

Unlike South Shore - where most major communities are tightly packed and easily navigated - North shore is more open and near impossible to experience by solely foot. Sprawling communities with a woodsy and rustic ambiance are definitely beautiful, but best experienced if you have a car available. If the aim of your vacation is to get away from the fast-paced stress of everyday life and enjoy Tahoe on your own time, North Shore cannot be beat.

No matter which side you choose, you can look forward to the ski-prime 396 inches of annual snowfall and almost 300 days of sunshine. Of course, the two halves aren't mutually exclusive. If you have a car, jumping between them is easy and there is transportation available to take you to the other side. No matter whether North or South is your choice, Lake Tahoe is sure to be one of your most beautiful and memorable vacations yet!

May Resort Spotlight - Elara, a Hilton Grand Vacations Club

2015-05-25T10:50:00.000-07:00

Las Vegas is a vacation destination unlike any other - there's so much to do, see and experience that it can be tough to cram all the excitement into one trip! One thing is for sure though - you'll be very, very busy! And you'll want somewhere plush, luxurious and utterly relaxing to come back to after your day in Sin City. The perfect choice? Elara, a Hilton Grand Vacations Club!

HGVC's Elara towers over the center of the Strip in the very heart of Las Vegas, providing convenient and easy access to the area's best attractions. The 52-story is right across the street from the Cosmopolitan and adjacent to the Planet Hollywood Resort & Casino complex. Adjoining access to Planet Hollywood makes exploring the hundreds of shops and restaurants along the Miracle Mile easier than ever. Traveling with a car of your own? Elara is conveniently located near I-15 and just four miles from McCarran International Airport.

Even with so much to do in the city, Elara is packed with a bounty of amenities to enrich your experience. Looking to kick back and relax after an exciting day on your feet? Cool off in the outdoor tropical complex, complete with whirlpools, private cabanas and a pool bar. A fully-equipped, modern fitness center ensures that your fitness routine won't suffer even on vacation. Before hitting the town, enjoy a cocktail or beer in the lobby bar. For an extra-indulgent experience, enjoy a massage and other spa services at the Mandara Spa right next-door at Planet Hollywood, also home to nine exclusive restaurants that cater to nearly any taste.

You'll enjoy every moment on Elara's sundeck!

Elara's studios, one, two, three and four-bedroom suites are undeniably luxurious. Each is decked out in ultra-modern, bold colors and prints while the decor is sleek and striking. Floor-to-ceiling windows offer breathtaking views of the city - especially at night! Studio units can sleep two individuals and offer all the essentials in a slick, attractive package. A well-furnished kitchenette, 42" plasma televisions, jetted bathtub, automatic curtains and a spacious seating area lend a luxe edge to the standard studio experience. Meanwhile, the larger rooms come with even more to make your trip as perfect as possible. Full kitchens equipped with stainless steel appliances and granite countertops are perfect for whipping up your own meal. Large living areas are furnished with leather sofas and even an eight-foot wide screen, projector and home theater system for serious entertainment. As for the bathrooms? Enjoy a whirlpool tub, separate shower and even a TV in there too! Every one-bedroom and larger suite includes in-room laundry facilities.

Sleek and modern - the perfect Vegas accommodations!

We could go on for days about everything there is to do in Las Vegas. Of course, the city is home to over 70 casinos where you can try your luck, each with a unique theme. But Las Vegas has much more than just gambling - there's literally hundreds of restaurants, a handful of malls and dozens of other shopping opportunities. Live entertainment is always in progress, whether you're looking for shows, concerts or something completely different. Don't think you're limited to the city, either - beautiful natural preserves such as Red Rock Canyon are just as exciting, as are attractions like the Hoover Dam!

Elara, a Hilton Grand Vacations Club's perfect blend of convenient location, gracious amenities and breathtaking accommodations earns our May Resort Spotlight. But we want to hear about your experiences as well! How was your visit? And would you return? Sound off below!

Imagine waking up to that view!

The Best Beaches for Your Summer!

2015-05-18T10:50:00.000-07:00

The temperatures are rising, the days are getting longer and May is in full-swing. As summer draws closer, we begin to think "beach" - on those long, hot days, there's no better way to cool off than with some sun, sand and surf with your family and friends! But which beach is perfect for your summer getaway? This week, we're looking at five often-overlooked beaches that are perfect for making awesome summer memories!

Eagle Beach, Aruba

Eagle Beach is the picture-perfect Caribbean retreat!

If asked to picture the perfect tropical beach, this is undoubtedly the one that springs to mind! Endless stretches of velvety, white sand melt into sapphire waters and cool breezes coming off in off the water help to stave off the heat. Without a doubt, this is the picturesque Caribbean beach that will leave all your friends back at home jealous! Cabanas and beach chairs are available for rent and due to the sheer size of beach, crowds are often at a minimum. Best of all, Eagle Beach and the greater area of Oranjestad are home to some of Aruba's finest resorts, making your stay just as enjoyable as endless hours soaking up that Caribbean sun!

La Jolla Cove, California

Tucked between beautiful sandstone cliffs, La Jolla Cove is one of Southern California's most beautiful beaches. While a bit smaller than other nearby beaches, La Jolla Cove makes up for it with a gentle surf that's ideal for swimmers, snorkelers, scuba divers and kayakers. The beach lies firmly within the San Diego La Jolla Underwater Park Ecological Reserve which means visitors just may encounter local wildlife - including the area's resident sea lions! While you're there, don't forget to visit the Caves, whether by foot or by kayak!

Sanibel Island, Florida

Every shell you collect on Sanibel is 100% unique!

Sanibel Island is a unique getaway, a retreat that's both relaxing and family-friendly. On Sanibel's pristine beaches, time slows down and you can appreciate the natural beauty around you. One of Sanibel's best attractions can be found right on the sandy shores - thousands of seashells, making shelling and beachcombing near-mandatory activities. Unlike many beach getaways, much of Sanibel is not lined with hotels, making for a clean and tranquil horizon. Rather, the island is packed with nature preserves, making sightings of rare Floridian birds and other fauna very common.

North Shore, Hawaii

If you're looking to catch a wave, Oahu's North Shore is the ultimate beach destination! With intense waves in the winter and gentler waves in the summer, North Shore proves to be an ideal beach for surfing regardless of skill level. During the winter months, visitors can also glimpse whales moving through the waters. Regardless of why you choose to visit North Shore, one thing is certain - it's a fantastic break from the crowded hustle and bustle of Honolulu!

Akumal, Mexico

Imagine swimming with wild sea turtles!

Akumal is a terrific alternative to Cancun for those who want shimmering, pristine beaches but not necessarily the party scene that comes with them. Indeed, Akumal's waters are sparkling-clear and ideal for snorkeling, where you can catch glimpses of rainbow corals, beautiful fish and even the sea turtles that are the area's namesake (Akumal is Mayan for "Place of the Turtle). When you need a break from the water, plenty of authentic restaurants and unique shops without the tourist spin are within easy reach.

Of course, these are just our recommendations! Which beaches are your annual go-to's? Have you visited any of our featured locations? Let us know!

Florida's Newest Timeshare Bill Stirs Up Controversy

2015-05-04T10:50:00.000-07:00

A new bill has made its way through Florida Congress that spells quite a few changes for timeshare owners. Known both as House Bill 453 and Senate Bill 932, the controversial legislation makes a great deal of technical changes to the Florida Vacation Plan and Timesharing Act. The bill's passing
has ruffled some feathers among both individual owners and industry leaders who fear the vague language can be abused. Others hold a more optimistic outlook and believe the bill will provide more stability and inherent protection for timeshare owners. As an owner advocate, RedWeek is committed to providing you with the entire rundown.

The bill was conceptualized with the best of intentions - to streamline and simplify ownership for owners. HB453/SB932 introduces changes like eliminating doubled-up interest fees and providing ways for a contract to end or be extended when the plan does not specify a way to do so. In addition, backers of the bill hold that the changes will provide consumers with more protection and freedom in regards to the fate of their timeshare plan, as well as bring the Florida Vacation Plan and Timesharing Act up to speed with modern real estate law.

State Representatives Eric Eisnaugle and Kelli Stargel have spearheaded the crusade for the introduction of HB453/SB932, fervent in the belief that the changes will help owners. The bill is also backed by the American Resort Development Association (ARDA), the Realtors Political Advocacy Committee (RPAC) as well as Florida-based developers Orange Lake Resort Alliance (Holiday Inn) and Disney Worldwide Services, Inc. - all of whom contributed monetary donations to the bill.

This endorsement of HB453/SB932 has many skeptics raising their eyebrows, fearing the legislation only gives more sway to developers who already hold the lion's share of power in a timeshare contract. Others are not as concerned with what the bill does say, but rather what it doesn't. Neither compliance nor materiality are adequately defined, giving developers the ability to define exactly what these terms mean in regards to mistakes or omissions in a given contract. Additionally, "nonmaterial" errors would not grant the purchaser cancellation within ten days, as is permitted now.

It's not just owners who are concerned with the implications of HB453/SB932. Industry figureheads like Gregory Crist (CEO of the National Timeshare Owner's Association) are also expressing their concern, stating that the bill is designed to protect developers who have no intention of following the law and that the technical changes will strip away mechanisms intended to protect consumers. Others like Scott Smith (assistant professor of hospitality at the University of South Carolina) only see removing property taxes from the 125% cap on annual increases in assessment fees weaken the allure of timeshares as an affordable vacation option.

So what's an owner to do in midst of such changes? If you find yourself wary of the implications of HB453/SB932, we encourage you to check out and sign the Change.org petition to veto the bill. Also, be sure to keep an eye on our partner blog Timeshare Information and our Facebook page for more updates as we hear about them. And of course, let us know your thoughts on the issue!

Welcome to the New RedWeek!

2015-04-20T10:50:00.000-07:00

Have you had a chance to explore the new RedWeek yet? With a sleek new look and improved functionality, the RedWeek redesign is packed with changes that we're sure will make posting and searching for timeshares easier than ever.

One of the biggest changes is one you're bound to notice if you're browsing RedWeek on the go - mobile functionality! Whether you're viewing from your phone or tablet, the RedWeek site is perfectly adapted to fit your device. No more pinching and zooming, or scrolling sideways to read minuscule text. Vertical scrolling, slick menus and quick loading times ensure that mobile RedWeek is every bit as great as the "full site"!

You might also notice the improvements to our search features when looking for a timeshare. After you type in a general location (think city, state or country), you'll have the option to refine your search on the results page. You can choose to specify results only within a certain date range or price range. Additionally, you can refine by unit size, RedWeek user rating or even features - perfect if you're looking for just all-inclusive resorts, or just resorts with internet or a pool, for example! Your results can also be arranged into list or grid views and sorted by user rating.

If you commonly post your own timeshare for rent or sale; rejoice! Our posting creation process has been greatly streamlined. Instead of navigating page by page, your posting is created on a single page with clean, expandable menus guiding you through each step. Photos are easier than ever to upload; drag and drop or upload them in bulk, with the option to review and caption them before your posting goes live.

Certain major pages were brought out of their more obscure locations into the limelight. The Timeshare Companies page - a hotspot for those looking to buy or sell a points system - is no longer just tucked away on the resales page, but rather accessible directly under the "Find a Timeshare" tab near the top of the screen. There's no need to visit the account page in order to view your postings, either. The "My Postings" link at the top of the page (left of the RedWeek banner) will instantly take you to the page where you can view and edit your postings.

While not active yet, we also have some great community features planned in the coming months! If you encounter any bugs, issues or something that just doesn't seem to be working right, please let us know at support@redweek.com. We hope you're every bit as excited as we are to experience the new RedWeek.com!

How to Speak Cajun

2015-04-10T10:50:00.000-07:00

(A tip of the hat to my niece who calls up and says, "…Hi Annie (Auntie) Helen, how ya be darlin'?")

If you are "fixin to" go to yo (your) timeshare in “Looziana”, (Louisiana) you need to understand the local dialect in order to communicate yo (your) needs clearly. Here's a quick guide...

In Hotels

1. Mash not push: When stepping into an elevator at your timeshare, don't ask a local to "push" the button of the floor you want, you ask to mash it, like "…Mash number four please!"

2. Fixinto: Most sentences begin with fixinto mean "I was going to do it eventually" or "I was getting around to it", such as "I was fixing to begin dusting, or fixin to go to the pool." ...So when your wife says, I want to go shopping, remind her that she is fixinto go shopping.

3. Lights and Lightbulbs: You don't turn them off and on, you "cut them off and on". To the hotel clerk, "I was fixin to cut on the light above the desk in my room, but it won’t work. Can you send me a new bulb?"

Driving Around

1. Fresh air: You "crack" a winder (window), not "open it." Try, "It's hot in here, crack yer winder wouldja?"

2. Asking for directions: Don't ask how many miles it is to the nearest bait shop. It's all in minutes - "Bill's Bait shop is 5 minutes down the road. Or, you can go to Fontaineau's which is about six minutes the other direction.You fixinto go fishing?"

3. Backwards and Forwards: When a local says he knows you backwards and forwards that means he knows everything about you. "Oh you fixinto go fishin today? Well that new reel and pole tells me backwards and forwards how experienced you are. Wan a book guide to fishin in Louisiana? Or a guide on how to rig yo line, or if y'all can wait about an aire (hour), I will be yo guide!"

In Cafes

Be aware that two types of "food" exist in Louisiana: Cajun and Creole. A common joke among the locals is that a Creole mama feeds a family with three chickens, whereas a Cajun family feeds three families with one chicken. Gator is a most delicious substitute for chicken, and most of the meals include okra. Creole's were generally looked on as the "rich" folks, who had access to markets where fresh foods were displayed and purchased but Cajun families often ate off the land and grew their own vegetables - usually onions and okra (the "french fries" of Louisiana). Single women, when assessing a male partner for the future, ask "is he a creole or a cajun boy?"

Another major difference between Creole and Cajun food is the type of roux that is used as the foundation of most food - which is usually in a "sauce". Butter and flour are the basis for Creole roux, while Cajun roux is made from lard and flour. Cajuns often didn't have access to butter so they slaughtered their pigs and other animals and made lard from the skin.

Gumbo is found in both cuisines. Creole gumbo has a tomato base (usually ketchup) and is more of a soup, while Cajun gumbo is more of a stick-to-your-ribs type of stew. Most everything has a distinct red base color.

There are only three flavors in Louisiana: hot, hotter, and hottest. These are powered by Tony Chacherie's spice mix (right on the tables with salt, pepper, Tobasco, chili pepper and ketchup. It's not "cha-cherry" but "sash-er-ee". Pepper comes in colors in Louisiana: black, red, white, green and pink. There is hot food, hotter food and "just the way I like it". Tourists can be identified wiping their foreheads as they eat, and locals will punch each other in the arm and snicker when they see these "sissies" eating their food.

Favorite Phrases in Local Cafes

1. Jeet: Meaning, "you are hungry and want something to eat?" You will hear jeet a lot - this is short for "did you eat?"

2. Hey darlin’/bon ami: the waitress calls everyone darlin' in her café - "jeet here bfo (before) darlin'?" Men call you "bon ami" - meaning good friend. "Ayyy bonami… jeet? Yo ere to camp? (spend some time in a vacation home or timeshare)?"

3. Buster: A buster is a soft shell crab that just shed its shell. Don't be surprised to hear, "ay ave a good buster for lunch today!"

4. The other white meat: Fried catfish is considered the "other white meat". Pork and gator are numbers one and two, and often accompanied by fired okra. Mudbug is another tasty delight served in many cafes - it's crawfish, boiled or fried.

5. Food preparation: "Ay mon ami, we have fried, bolled (boiled) deep fried, brolled, (broiled) or baked, which ya want? The Chef was fixin to make a new pot of bolled coffee if y'all can wait for it!"

Local Activities

Major local activities involve gator hunting, crabbing, and "fais do do". Gator heads mounted as trophies on the wall are not prevalent in the Bayou - instead, they're often used for various purposes. Many Cajun families make necklaces of gator teeth to sell to tourists. It used to be that you could take a boat down the bayou to see the gators. Guides would stick marshmallows on the end of a stick and gators would fly up out of the water, grab the marshmallow and fall back into the bayou. That was until a gator landed in the middle of a boat and then the tourists became gator food. It is now against the law to "marshmallow" gators.

Cajun families often feed their families by crabbing - they stick a piece of bacon on a string and lower that into a crab mud hole to entice it to come out for "dinner".

If you are invited to attend a Fais Do Do, be sure to go! It is a wild party that lasts until morning.

“Laissez les bon temps rouler!”

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This article is by guest author Helen Sabin. Helen Sabin is a timeshare traveler and RedWeek member from Colorado Springs, Colorado.

April Resort Spotlight - Disney's Polynesian Villas and Bungalows

2015-04-06T10:50:00.000-07:00

After months upon month of heated rumors and speculation, Disney Vacation Club's newest resort - Disney's Polynesian Villas and Bungalows - opened its doors to guests on April 1st! DVC resorts consistently rank highly among vacationers, and the Polynesian Villas and Bungalows appears to be no exception! With an immersive ambiance, premiere Orlando location and that classic Disney magic we all know and love, this South Seas-themed resort is poised to become your next go-to for an unforgettable Orlando vacation!

Disney's Polynesian Villas and Bungalows lies along the Seven Seas Lagoon and offers up first-class views of Magic Kingdom's "Wishes" fireworks display as well as the Electrical Water Pageant. Walt Disney World's iconic monorail system sweeps right through the resort, providing quick and easy access to the Magic Kingdom park, Epcot park, the Transportation and Ticket Center and several other resorts directly bordering the Seven Seas Lagoon. Other parks can be easily reached via bus.

The resort's grounds are shared with Disney's Polynesian Village Resort - the standard, non-timeshare sister resort. Swathed in palm trees and tropical flora, dotted with tiki torches and koi ponds, Disney's Polynesian Villas and Bungalows feels every bit as exotic as its namesake. These "longhouses" are shaped in the classic oceanic style and embellished with deep, red woods and exotic patterning. The lobby and shared interior areas are every bit as tropical and bright as the exterior - breezy, open-air areas and indoor greenery add life and vibrance.

The resort's distinct facade is immediately recognizable.

Even if you never plan to hit the parks, the DVC division of the Polynesian is set with enough to packed with more than enough to keep you busy. The Lava Pool winds around a faux-volcano and includes a waterslide, and the Polynesian East Pool is quieter, ideal for a relaxing swim. Lilo's Playhouse gives kids the opportunity to participate in a myriad of activities while the adults enjoy time to themselves. Several different dining options can be found on site - character dining at the 'Ohana restaurant, casual Asian-infused fare at Kona Cafe and snacks and drinks at Trader Sam's Grog Grotto and the Tambu Lounge.

Disney's Polynesian Villas and Bungalows' new Deluxe Studio unit elevates the average studio with more storage space, "longer" rooms and a kitchenette. The Deluxe Studio isn't the only new concept to be found, however - the Bora Bora Bungalow unit is set to become a hit for guests with large parties! These free-standing units are built right over the lagoon and feature two bedrooms, a full kitchen, separated living and dining areas, gorgeous lake views and even a private plunge pool that overlooks the lagoon. Whether you choose the Deluxe Studio or Bungalow for your trip, count on the warm colors and custom-crafted Polynesian decor that made the original Polynesian Village Resort so iconic.

Bright, vibrant and perfectly Polynesian!

Staying at a Disney Vacation Club resort often goes hand-in-hand with experiencing all the entertainment offered by Walt Disney World. However, Orlando has so much to offer beyond just WDW. Disney's Polynesian Villas and Bungalows is just a drive away from other major area theme parks, such as Universal Studios, Universal Studio's Islands of Adventure, SeaWorld and Wet'N'Wild. Orlando is also home to a staggering array of shopping experiences - The Mall at Millenia, Orlando International Premium Outlets and The Florida Mall all lie within reach by car. For a more cultural experience, Orlando proper is quickly blossoming with a multitude of specialty museums and galleries as well as upscale dining.

The wait for the opening of Disney's Polynesian Villas and Bungalows has been a long one, but now the door is open to both DVC owners and guests! Are you excited to give Disney's Polynesian Villas and Bungalows a try - perhaps even have a trip of your own planned? If so, don't forget to leave a review on RedWeek!

That's right - a picture-perfect beach in Orlando!

Is it Time to Sell Your Timeshare?

2015-03-30T10:50:00.000-07:00

Timeshares are a fantastic, reliable investment for many vacationers. But sometimes - after the initial honeymoon period has ended - owners might decide they no longer wish to keep their timeshare, or that it's not as useful as it once was. So many owners remain locked into a timeshare that they're no longer getting their "money's worth" from - how do you know when it's time to sell your timeshare?

An owner's interest in their timeshare might decrease for any number of reasons. One of the most common we hear about it an inability or decreased ability to travel. Be it for health, financial or personal reasons, reduced ability or interest in travel saps much of the usefulness out of timeshares. if the problem is temporary and you'd plan to resume travel after its resolution, you may consider renting your timeshare out instead - this can be an excellent way to recoup the year's maintenance fees and ensure that your week doesn't go to waste.

Many owners may find themselves struggling with the financial burden of a timeshare. Timeshares are definitely a luxury product and demand quite a bit of payment both upfront and on an annual basis - even more so if you made your purchase directly from the developer! Factor in the additional costs of travel (such as airfare, gas and food) and you're committing a very significant amount of money to that yearly vacation. Again, renting your timeshare can help mitigate annual maintenance fees, but if you find yourself gritting your teeth every year, trying to work your timeshare into your finances, it may be worth reconsidering if you want to keep it around.

A lack of flexibility might also be a cause for decreasing interest in a timeshare. While points systems and vacation clubs that allow owners a multitude of destinations are growing in popularity, the limited nature of many ownerships can be off-putting. Perhaps wild summers in Cancun are no longer your thing, or you've just seen all Orlando has to offer. If you find yourself a feeling bored on your next timeshare trip and own at a singular resort, it may be best to sell and use that time and money to explore new destinations. If you're the type who lusts after a new vacation spot every trip, you can also consider renting out other owners' weeks after you sell for incredible discounts.

Should you decide to take the leap and give selling a go, it's best to make sure you're prepared and have all your bases covered. RedWeek's "Posting and Selling Your Timeshare" guide gives you an idea of how to get things started, and you can use the free "What's My Timeshare Worth?" tool to feel out the pricing of your sale. If the resale process seems a bit overwhelming, RedWeek's full-service resale option takes all the stress of out of the process and puts your resale in the hands of full-service agents and licensed brokers.

If you've sold your timeshare, ring in with your experience below - how did the process go, and were you happy with your decision? What was your motivating factor?