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Watchdog: Few complaints to state, little policing of industry

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Deseret Morning News graphic

Despite problems with the timeshare industry found by the Deseret Morning News, state regulators say they receive relatively few complaints about sales practices — and have only one man policing the industry.

In fact, the State Department of Commerce has fined only one developer in recent years.

Westgate Resorts was fined $2,500 for failing to deliver a promised snowmobile trip to a prospective client; using unlicensed salesmen; failing to give a mandated sheet of consumer warnings to a buyer; failing to review as required contents of a property report with buyers (and giving them copies only on a CD instead of in print); and claiming the state had somehow authorized special discounts it offered.

The state has only one investigator for the timeshare industry, Charles Smalley.

He does not go undercover to sales presentations. "My presence is disclosed, and the salesperson involved knows that I am a state regulator. The on-site inspections, required by law, are paid for by the timeshare developer, to include the cost of the room rate, trip, per diem, etc.," Smalley said.

That would seem to ensure that salesmen would be on their best behavior during inspections.

Smalley says the State Real Estate Division receives an average of 12 to 15 complaints a year about timeshare sales, and 60 percent of them are "buyer's remorse" complaints — buyers wishing they had not bought their timeshare — about which he can do little.

He said about five such cases a year do manage to have larger developers cancel their contracts with no refund — meaning no money is returned, but owners no longer owe annual maintenance fees.

The Better Business Bureau also receives complaints about some timeshare industry companies.

Online searches show the BBB of Utah, for example, received 16 complaints in the past three years about the Westgate Park City Resort and Spa. Westgate's parent company has headquarters in Orlando, Fla. The BBB of Central Florida said it had received 509 complaints there about the company's practices in the past three years.

The BBB of Utah received 25 complaints in the past three years about Trendwest. That company is based in Redmond, Wash., and the Better Business Bureau there reported receiving 71 complaints in three years about its sales practices.

The number of complaints the BBB of Utah reported for other companies in the past three years include: Timeshare Marketing & Finance Corp., 20; Camperworld, 6; Timeshare International Properties, 5; the Miner's Club at Park City, 4; and Owners Resort and Exchange, 3.

Monday: Promises, promises

E-mail: lee@desnews.com