No relief for dodgy timeshare

Inquiry awash with horror stories

ALICE* was told she won a holiday.

But when she attended the presentation, to collect her prize, she was instead preyed on by sales people who talked her into signing a contract for timeshare.

The salesperson told Alice to sign up, although she allegedly told them she depended on a social grant, and that her husband worked odd jobs.

Later, when she tried to cancel the contract, the club referred her to a re-sale agent, who wanted her to pay an additional R60 000.

Her husband would even cash in a policy to service the monthly debits that amounted to R19 016.

Never once did Alice book accommodation or use the points she bought.

Desperate, Alice received a letter from the Department of Labour confirming she was unemployed and submitted it to the club. Still, they didn’t release her from her contract.

Stories like Alice’s came up time and time again during the National Consumer Commission’s (NCC) inquiry into the timeshare industry.

The NCC released its long-awaited report this week, and while there are proposals for redress for those who invested in vacation ownership and want out, there are no immediate solutions.

National consumer commissioner Ebrahim Mohamed said the NCC wanted to find a way of addressing the “plethora of issues raised by consumers”.

He said the situation was exacerbated by the nature of the timeshare product offering, “with all its legal and structural complexities”, and a need to improve consumer protection.

Goods and Services Ombud’s (CGSO) Magauta Mphahlele said more than 400 complaints were received, of which 68% were on timeshare cancellations.

The report recommended changes to the management of timeshare clubs, the competitiveness of timeshare products, marketing – including hoodwinking consumers – credit issues, fairness of contracts, the points system, quality of accommodation, and legislative reform.

Mohamed told of the distressing tales relayed during public hearings held by the commission, and of owners’ frustration, anger and even despair.

“The greatest discomfort I experienced though, was when a Free Statebased consumer told how she planned to take her own life to escape her debtstricken circumstances, which were occasioned by ‘a mistake’ she made when she signed up for a lifelong ‘timeshare trap’,” Mohamed said.

The commission said it anticipated its recommendations could be implemented, depending on the willingness of the industry to engage in good faith with it and other stakeholders.

The NCC referred timeshare complaints to the ombud in recent times, which has facilitated cancellations for consumers.

Mohamed said the biggest issues for consumers related to the points system, and these should be fixed-term contracts so people were not locked “in perpetuity”, and provision to sell or exchange points.

The NCC held discussions with Trade and Industry Minister Rob Davies about recommendations and that he consider revising legislation to enhance consumer protection, particularly in timeshare. However, changes will take time. The report puts the onus on the NCC to enforce the Consumer Protection Act.

Alex Bosch, the chief operating officer at the Vacation Ownership Association of Southern Africa (Voasa) – which made submissions to the commission – said he welcomed the release of the report.

“Voasa appreciates that a spotlight has been placed on the timeshare industry and remains committed to ensuring owners and holiday club members are satisfied with products and levels of service received,” Bosch said.

He said Voasa would continue to work with the commission to achieve change.

*Not her real name.