GUADALAJARA, Mexico — First, the cartel became involved in drug trafficking. Then avocados, real estate agencies and construction companies. Now, a Mexican criminal group known for its brutality is targeting seniors and their timeshares.
The operation is simple. Cartel employees pose as sales representatives and call timeshare owners and offer to buy back their investments for generous sums. They then demand upfront payments for a variety of things from running ads to paying government fines. The representatives convince their victims to transfer large amounts of money to Mexico, sometimes up to hundreds of thousands of dollars, and then disappear.
The scheme has netted the Jalisco Nueva Generación cartel hundreds of millions of dollars over the past decade, U.S. officials who were not authorized to speak publicly say, via dozens of call centers in Mexico that relentlessly target American and Canadian timeshare owners. . They also bribe Mexican resort employees to leak guest information, US officials say.
With little more than a phone and a convincing script, cartel employees are victimizing people in multiple countries.
The cartel takes advantage of retirees who want to leave money to their relatives by selling assets. Several victims interviewed by The New York Times said the money they had lost to scammers exceeded the value of their initial investment in timeshares in Jamaica, California and Mexico. “I'm old, like these clients,” said Michael Finn, founder of the Finn Law Group in St. Petersburg, Florida, which has represented thousands of people facing timeshare fraud. “We tend to trust when someone calls us to chat with us and sell us these dreams.”
Four years ago, Finn said, he received a call from a desperate woman whose mother had transferred $1.2 million, her life savings, to Mexico to sell her timeshare.
Nearly 10 million American households own timeshares, the association reports, spending an average of $22,000 on their investment, plus annual fees of around $2,000. Most are in beach resorts.
In the case of scams originating in Mexico, the FBI can only investigate if it obtains local cooperation. And U.S. law firms cannot file civil lawsuits in Mexico without hiring a licensed Mexican attorney.
In the last 5 years, American timeshare owners lost $288 million, the FBI says. The real number is most likely higher.
In October 2022, a retired couple — James, 76, and his wife, Nicki, 72 — said they received a call from a purported real estate agent at Worry Free Vacations in Atlanta, offering to negotiate the sale of his timeshare in California to a rich Mexican. They asked not to publish their last name because they were “very embarrassed” at having been defrauded.
As their daughters grew older, the family stopped using the vacation spot they bought in the 1990s for about $8,000, so the couple welcomed the opportunity to sell.
The scam started with small amounts, James said — a few thousand dollars here and there intended to pay off the Mexican government's registration costs for “cross-border transactions.”
About two dozen payments later, the couple had transferred nearly $900,000, their life savings, to bank accounts in Mexico, bank records reviewed by The Times show.
In Puerto Vallarta, a cartel stronghold and a popular beach town, Mexican hotel workers are routinely pressured by the criminal group to leak guest information, said FBI agent James Barnacle. Of particular concern to U.S. officials is Grupo Vidanta, one of the world's largest timeshare resort companies based in Mexico. Its owner, Daniel Chávez Morán, is a friend and advisor to the President of Mexico.
Many of Vidanta's clients have been victims of timeshare fraud, according to a U.S. official who was not authorized to speak publicly. Vidanta did not comment on questions.
As for James, he slowly realized that he would never see his money again.
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