Timeshare Scam Stories

CANCUN, Mexico -- After hopping an old 727 from Miami to the coast of Mexico, my wife and I were just a customs check and a cab ride away from the white sand beaches of Cancun.

We were on our honeymoon, anxious to relax beside the Caribbean and sip Margaritas under the warm Mexican sun. While neither of us had been to Mexico before, we felt we knew what to expect: sun and fun spiced with a typical tourist scene, including a million-and-one ways to spend our American dollars, some frivolously, some foolishly.

After having our passports stamped, we proceeded to the American Express kiosk to get the shuttle van, which was included in our all-inclusive package at the Crown Paradise Hotel. But as we walked through the airport, I hesitated briefly to get my bearings and was quickly approached by a pleasant gentleman representing Best Day Tours. He pulled us over to his own kiosk, which was staffed by other smiling and friendly representatives, ostensibly to offer us free information. While my wife and I were busy attempting to conjure up our memories of what little Spanish we once knew, he addressed us in near-perfect English and welcomed us to Cancun.

Now, anyone who has ever been approached in a similar manner knows the momentary confusion that comes when one is confronted by a sales pitch in a foreign country, usually followed by a moment of clarity upon hearing the word free. It seems our friend was offering us a FREE “Jungle Tour” if we would agree to have a FREE breakfast with one of their representatives and tour one of their hotels -- you know, so that next time maybe we’d stay with them instead.

While my instinct was to immediately say “No thank you,” the idea of touring another hotel while simultaneously investigating the ambush-style marketing campaign of a foreign travel company had piqued my curiosity. I even forked over a $20 deposit, a 100%-refundable deposit I might add, which would guarantee that I would indeed attend the breakfast even after settling in at my own hotel. Heck, the Jungle Tour was an $80 package which included snorkeling and driving speed boats, so how could we go wrong?

Once arriving at the Crown Paradise, we checked in, made our way to the room and ultimately to the beach. We even met with an American Express representative to plan other trips and tours during our stay.

The next morning we got up early to head over to our “complimentary breakfast,” courtesy of our newfound marketing buddies. We arrived at the Piramides Cancun by complimentary taxi (the driver was less than thrilled about having to find someone from the hotel to pay him, but that was none of my concern), and proceeded to seek out the appropriate representative. As it turned out, we would be visiting with a representative of Royal Holiday Club. Apparently the rep from Best Day was merely a mercenary retained for the initial ambush. Where does Best Day fit into all of this? I have no idea. But on with our story.

Well, breakfast was good, but not great, and we spent the time answering questions and chatting with Raoul, Royal Holiday Rep number-one, about our travel habits, our income, and a host of other relatively personal tidbits of information. Now, upon arrival we were told the presentation would take about 90 minutes after breakfast. No problem, it was only about 9:30 a.m., and they already gave me my $20 back, so I was feeling good.

After eating, Raoul, an altogether warm and friendly fellow, gave us a tour of the property, showed us some fantastic suites complete with a Jacuzzi on each ocean view terrace, and even walked us out to some Mayan ruins which were found during the hotel’s most recent renovation. He was very complimentary. Imagine that.

During our tour I peppered Raoul with questions about the program, the hotel, about rates and the industry in general. He would merely jot down the questions in a little notebook and said they would all be answered later. I hoped it wouldn’t be all that much later.

Well, after watching an extremely ridiculous video extolling the joys of vacationing and traveling the world (the theme was “Traveling the Royal Holiday way is both fun and rewarding”) we were escorted into a special area. It was Royal Holiday mission control. Not unlike the bridge of the Starship Enterprise, a scene from “Glengary Glenross” and the War Room from “Doctor Strangelove” all rolled into one. There were about 25 tables in the room, with three individuals, a couple and a Royal Holiday Representative, around each one. They would ring a bell when somebody signed up for the club. I found that disconcerting.

I continued to chat Raoul’s ear off, until he finally excused himself and introduced another Royal Holiday representative: Raoul number-two. Yes, by sheer coincidence, both gentlemen were named Raoul, both were extremely friendly and both told me I appeared to be wise beyond my years. Heck, it must be true then.

I reiterated my position to the new rep: That my interest in being here was to investigate Royal Holiday, tour the hotel and to get the free Jungle Tour. I explained that I understood how a sales situation works and I didn’t want him to waste too much time with us as we were simply not buyers. He chose not to believe me. “Good for him,” I thought, “He’s a real go-getter.”

What transpired from that point forward consisted of Raoul number-two explaining how much money we could save by joining Royal Holiday Club, fixing our travel costs for THIRTY years. I asked what would happen if the economy tanked, people traveled less and the glut of hotel rooms caused room rates to bottom out. He didn’t think that could ever happen. Oh, ok, as long as Raoul doesn’t think so.

He also informed us that we could only buy in right then and there. (I called Royal Holiday’s Miami office upon my return and they were more than willing to enroll me in the club over the phone, so I’m assuming Raoul must be new with this organization). There would be no way to join over the phone or get back to him. It had to be decided that day. I told him, for the last time and for his own benefit, that I definitely was not going to be buying anything this day. He chose not to believe me.

Raoul number-two was quite good at his job. He met all my objections. He answered all my questions, well, sort of. He even told us it was his dream to visit New York. I told him not to get his expectations up too high.

Here’s how the system seems to work: An individual who travels every year can buy into the club and stay in any number of hotels around the world. Members get roughly 30,000 points per year for which they pay $0.95 per point, which is somewhere around $28,500 (I got Raoul down to about $0.60 per point but then, I’m a shrewd negotiator). Different periods of the year require different amounts of points. Generally, 30,000 points gets you about three weeks of off-peak time or one week of peak time, Holiday Week for example. After the initial payout of, lets say $15,000 (but this depends on your negotiating skills), there is a $1,000 sign-up fee and a $515 yearly membership fee. That gets you 30,000 points a year for 30 years, thereby fixing your vacation costs for the rest of your life. Bear in mind this company has only been around since 1986 and has only been offering club membership since 1992. Thirty years is a long time.

According to the Royal Holiday Website ( www.royal-holiday.com ), there are 70 hotels in the system. According to Raoul, you can stay in any city in the world. If Royal Holiday doesn’t have a hotel there, they will arrange something for you through their many affiliations with Starwood, Hyatt, Hilton and other reputable hotel companies. Now, I called Starwood when I got home, and while Royal Holiday may indeed book rooms at Sheratons and Westins and the like, there is no official affiliation with Starwood. To me, that’s misleading. But maybe I’m hyper-sensitive. I wonder how Starwood feels about it. My guess is they’re hyper-sensitive as well.

Now, a great advantage of Royal Holiday Club, according to Royal Holiday Club of course, is that you can rent, trade or gift the points. You can even leave them as an inheritance (which is an uplifting thought for a 30-year old couple on their honeymoon, let me tell you). So I asked Raoul what I thought to be a reasonable question: Am I liable in that situation?

His answer went something like this: “What do you mean?” “Well,” I said, “suppose I rent my points to somebody and they fall down and break their leg in the room. Do they sue me, the hotel, both of us? What’s my liability in this situation?” Then silence.

“Nobody does that!” Raoul said. Wrong answer. Then Raoul told us that Royal Holiday doesn’t want just anybody to join this club, they have very high standards. For instance, they only accept people who they randomly pull off of airplanes in the Cancun airport. That’s a reasonable screening process I guess.

After going back and forth with Raoul for about two hours, I told him there was no way in hell I would commit to something like this, for this amount of money, even if I did have that kind of money, on the spot without researching it further. He didn’t like my answer. Raoul, who was a very congenial fellow, brought in a third representative -- Super Closer, his boss I presumed -- ostensibly to inquire as to how Raoul’s approach was. Then, as I expected, he hit us with the last-ditch effort, designed to come after the sales situation had already been diffused. More sales babble. The Columbo close, I think they call it.

Now, I’m a patient man (for a New Yorker) but this was about enough for me. I kindly said no thank you and prepared to get on with my day (it had been nearly four hours since I arrived at the Piramides Cancun), when this gentleman, the Super Closer, uttered the phrase, “Seriously, it’s your lucky day. Listen to what I have for you.” That’s when I got up and left.

Now my question is, what’s the deal with Royal Holiday? This is obviously a large organization, with roughly 47,000 members worldwide according to their Website. Raoul told me there were 70,000 members. It implies, right on the Website, that Royal Holiday has relationships with Hyatt, Sheraton, Marriott, Carnival Cruise Lines, Royal Caribbean Cruise Lines and others.

They clearly have a very expensive marketing program. But, despite the attractive properties they own or have affiliations with, despite the fact that the club does indeed seem to be a fair deal if used properly, I walked away from my experience with a bad feeling. Sure, they seemed like nice fellows. Maybe they are and maybe they aren’t, but I honestly felt bad for anyone who walked out of that room after having inked their name on a contract with these people. How can anyone be expected to make such a decision in that environment? It seems a sure-fire recipe for unhappy customers. But obviously, there are plenty of satisfied ones.

I can’t be sure exactly how closely Royal Holiday is associated with these hotel companies, but I’m going to find out. Since arriving home, I have read a number of newsgroups mentioning Royal Holiday and the postings seem to be about 60% to 40% unhappy versus happy members respectively. Of course, unhappy customers are more likely to post comments than happy ones. There is even one group, Sol Caribe Owners, attempting to sue this organization and others like it over what it claims is fraud, according to their Website (www.solcaribeowners.com), although I have no way of knowing the legitimacy of their claims. Royal Holiday Club is mentioned specifically on this site, in reference to the Sol Caribe Resort in Cozumel, Mexico. Check it out for yourself. I couldn’t get anyone on the phone to give me any information other than to send me a sales package.

What I do know is that if I was a hospitality executive, I wouldn’t want my brand name associated with this type of sales operation. Perhaps it is only the Cancun office in the Piramides Hotel that operates in this manner. While club membership may not exactly be timeshare, perhaps such organizations can take a lesson from that industry and note that it took nearly 30 years to shake the snake-oil image which was created by exactly this type of sales approach. It’s the absolute last thing I would want to deal with on a vacation, and I think most hotel guests feel the same. I spent nearly four hours with these people. At least one of which was spent trying to slip politely out the door.

Granted, travelers must be responsible for their own actions. I could have left at any time, and I did have an ulterior motive to keep listening. But that doesn’t mean people don’t get burned just the same. Some people are going to get in over their heads and those people will most assuredly remember a negative hospitality-related experience.

Aside from the hard sell, it’s a simple matter of not getting sucked in. Besides, the Jungle Tour was great. And Free. Sort of.

Nick Raio has been a professional reporter for more than 7 years and has written for several weekly and daily newspapers in New York, Texas and New Hampshire, including the Northport Observer, the Smithtown News, The Long Islander, the Plymouth Record Enterprise, the Three Village Times and Foster's Daily Democrat. He has covered topics ranging from breaking news to business analysis, arts, entertainment and recreation. Most recently he was a staff editor at Hotel Business. He also received a 1998 New Hampshire Press Association Award for excellence in education reporting. Nick graduated from the State University of New York at Stony Brook with a B.A. in English.