Timeshare Fraud

The FBI has seen a rise in scams targeting timeshare owners, specifically in Mexico. In this kind of scam, criminals con part-time property owners into shelling out hefty sums of cash upfront, all under false pretenses related to their timeshare properties.

These schemes—which disproportionately impact wealthy, older Americans who want to recoup some of the money they spent on their timeshares—leave victims emotionally and financially scarred. 

Learn more about timeshare fraud below and the process scammers use to find potential victims.

If you believe you may have been victimized, stop sending money to the fraudsters, and file a report at ic3.gov.


How does timeshare fraud work?

After victims purchase their timeshare property, fraudsters commonly use three phases of approaches to continually scam victims.

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Phase 1: Initial Contact between Fraudsters and Victims

  • Fraudsters contact victims by phone or email, often pretending to be third-party timeshare brokers or sales representatives in the timeshare, real estate, travel, or financial services industry.
  • Fraudsters urge victims to take one of three actions:
        1. Exit their timeshare
        2. Rent out their timeshare property
        3. Invest in share certificates for their      timeshare
  • Fraudsters then press victims to pay upfront fees or taxes to secure these deals.

Phase 2: Fraudsters Reproach Victims as Law Firms Employees

  • Fraudsters re-approach victims, posing as law firm employees who want to help victims recoup money they handed over in Phase 1.
  • But in order to receive that money, the fraudsters tell the victims they must pay legal or court fees to the law firms. 
  • Fraudsters use fake documents to bolster their credibility as legitimate law firms.

Phase 3: Fraudsters Impersonate U.S. and Mexico Government Officials 

  • Fraudsters pretend to be officials from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC), the Mexican government, or from international entities, such as INTERPOL.
  • Impersonators may claim they’re contacting victims because they have access to criminal settlements and want to help them recoup their lost money.
  • Or, impersonators may try to scare victims into sending more money by telling victims their initial payments to timeshare fraudsters were deemed suspicious, i.e., linked to money laundering or terrorist operations. Fraudsters may threaten to send victims to prison if they don’t make additional payments.


What is the FBI doing about this type of fraud? 

The FBI is using strategic partnerships to detect, investigate, and prevent timeshare fraud. The FBI partners with other federal agencies, state and local agencies, and private sector partners in the financial industry to aid in the detection and prevention of timeshare fraud.

Criminals involved in timeshare fraud can face extradition to the U.S. and potential prosecution on charges, including:

  • Wire fraud
  • Bank fraud
  • Conspiracy to commit wire fraud
  • Conspiracy to commit bank fraud
  • Money laundering
  • Racketeer Influenced and Corrupt Organizations (RICO) Act charges



Did You Know?

Fraudsters do their homework—they tap sources within the timeshare industry to get information about timeshare properties and their owners.


They also go to great lengths to impersonate individuals from trustworthy institutions and sell victims on the authenticity of their schemes by drafting fraudulent contracts, offer letters, and bank account documentation.

Red Flags 

  • People shouldn't ask you to pay upfront fees or taxes in advance. They also shouldn't ask you to provide a power-of-attorney form. None of these are industry standard practices.
  • If you’re contacted by someone claiming to be a government official, that person shouldn’t:
    • Reach out to you about a settlement.
    • Threaten to arrest or prosecute you if money isn’t paid.
    • Threaten to subpoena you to appear in court outside of the U.S.
    • Claim to be working with the FBI and/or the U.S. Treasury Department’s Office of Foreign Assets Control to subpoena you.

What do you do if you're a victim? 

Information to Report to the FBI

If you or a loved one suspects that you might be a victim of timeshare fraud, please file a complaint with the FBI’s Internet Crime Complaint Center (IC3). You can do this by visiting ic3.gov and then clicking "File a Complaint" in the menu at the top of the page.

The quicker you reach out and the more information you can include in your complaint, the better. If possible, please include the following information when reaching out to IC3:

  • The estimated total amount of money you lost to the scammer(s)
  • The details of any wire transfers you might’ve sent them
  • Bank account numbers
  • Names of businesses and individuals involved in the scam
  • Information about how you spoke with the scammers (such as phone numbers or email addresses)

Tips for Avoiding Timeshare Fraud 

The FBI has identified ways to help guard yourself against timeshare fraud:

  • Don’t answer unsolicited phone calls from unfamiliar numbers.
  • If someone contacts you about your timeshare and requests cash upfront, stop communicating with them, and don’t send them money.
  • Don't sign, notarize, or send any power-of-attorney or legal documents via email.

Resources 

Additional information about timeshare fraud and resources for timeshare fraud victims and caregivers: