Diamond Resorts International

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Sales Presentation Not Consistent With Written Agreement
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Here is a copy of the letter that we sent to Diamond International Resorts

Diamond Resorts Headquarters 4-11-11
10600 West Charleston Blvd
Las Vegas, NV 89135

Attn Legal Department
Attn Chairman and CEO Stephen J Cloobeck

My name is Ann Olson. My husband and I, purchased 3000 points from Diamond Resorts International on February 25, 2010 for $10,318.00. Since then we have also paid $777.60 for an Assessment Fee on May 5, 2010. Currently, we have an additional bill from Diamond Resorts U.S. Collection Members Association for $813.70 for Assessment Fees.

After numerous conversations with Diamond Resorts employees, extensive research about timeshares, specifically Diamond Resorts International and reviewing my notes taken during both presentations, I am sending this letter. My husband and I are very clear that we experienced complete misrepresentation, coercion and fraud. (as defined below) We are formally requesting a full refund of monies paid totaling $11,095.60 and canceling any further relations with Diamond Resorts International.

A scam, fraud or misrepresentation occurs when a sale representative creates false expectations with the intention of creating a sale. Promises such as, renting a timeshare creates a substantial income; promising the sale of one Timeshare to absorb the cost of purchasing a new one; or simply, creating unrealistic expectations as to the use of the Timeshare.

Fraud is defined as a deception deliberately practiced to secure unfair or unlawful gain. It has also been defined as the intentional misrepresentation of truth for the purpose of obtaining something of value by inducing another to rely upon false information. A material misrepresentation is an important untruth. Fraud requires an outright lie, or a failure to state a material fact about an important part of the contract. Regardless of definition, the key elements of fraud are these; intent, the misrepresentation or untruth, reliance on misrepresentation or untruth, and something of value obtained as a result. Your timeshare contract can be canceled by a court because of fraud if the resort or it's salespeople knowingly made a material misrepresentation that you reasonably relied upon to make your decision to purchase or upgrade your timeshare.

Misrepresentation is a contract law concept. It means a false statement of fact made by one party to another party, which has the effect of inducing that party into the contract. An untrue statement, whether unintentional or deliberate, is a form of misrepresentation. It may be a form of nondisclosure where there is a duty to disclose, or the planned creation of a false appearance. Where there has been a misrepresentation of material fact, you may sue your timeshare resort for damages and/or rescind the contract. You can rescind your timeshare contract for misrepresentation if the misrepresentation was material, or critical, to the agreement.

Our Story

In Feb 1999, my husband and I purchased a timeshare through Westgate Lake Resorts in Orlando, FL. We have enjoyed having a week to use for vacation but had been looking at the option of a points based system verses a week based. In February 2009, we traded our week at Westgate to stay at Scottsdale Link Resort in Scottsdale, Arizona. We were made aware at our arrival that we were required to attend a 90 min presentation about Scottsdale Resort because we were timeshare owners. After a large amount of confusion regarding childcare for our little ones, we were sent to a private office with our kids to do our required 90 minute presentation, however we ended up being there for 4 ½ hours. During the presentation, the salesperson did a good job explaining the points system and from what we had been told, we were very interested. We were excited about the idea of trading in our Westgate week in Orlando, switching to points and only having to pay one maintenance fee per year. However, even though it sounded better than we could have imagined, we were not in a position financially to make this type of commitment. We told him that we would need to wait and maybe the next time we could do something like this.

Our salesman made it clear that we were only given this ONE chance to buy with Diamond. He said once you are in our system you are there forever. So if you are interested in Diamonds point based system, we needed to buy right then. He said, “once you have been presented the Diamond option, if you try to call to book an appointment, our names would be flagged” and we would never be able to buy from Diamond then. We were very overwhelmed but we once again told him we were not able to purchase right now even if it meant giving up these first time incentives. He once again reinerated that we would never again have the opportunity to buy in with Diamond. So we told him that we would still have to pass and we could always try to find another points based timeshare when we were ready. He told us that we would never find one that offered the great benefits that Diamond offered. Then he told us to hold tight while he left the room. When he came back in he explained to us that for a limited time he was able to offer us a “Sampler Program” for $620. That would buy us a year to get our finances in order. It would basically freeze the negotiations right where we were at, all of our information would be entered into the system and would be available to the representative that we would meet with when we used our sampler. We decided to purchase the sampler by putting it on our credit card but little did we know that negotiations did not freeze and our information would not be entered into any “system” to be available for another representative.

On February 25, 2010 we arrived at Grand Beach Diamond Resorts in Orlando Florida to use our sampler package. When we arrived we were informed that since we were staying at the resort with a Sampler Package we were required to attend a 90 minute presentation to review the Diamond plan that we had been presented within Phoenix. We had decided that there was no way we could join Diamond. We were already paying over $800 a year in main fees to Westgate. The answer was no. We were not going to waiver and we even left our wallets back at the room. We sat down with Chad Benkert for a “quick” review to tell him our decision and we were heading out to Hollywood Studios with our kids.

Here are some disturbing highlights from our five hour presentation.. The statements that are underlined are specific examples of fraud/misrepresentation.

• The “quick” 90 minute review ended up lasting more than five hours. Each time we got up to leave- they said that we weren’t finished. He said that we still had to do this and that before we could be released from the sampler agreement that we signed. I had brought paper and pen to document our conversation. I also had brought with me our folder from our original meeting with the Diamond representative in Phoenix along with the detailed notes that I had taken during that first meeting with Diamond.

• As soon as we sat down, we explained to Mr. Benkert that we were not interested in buying into Diamond but we thanked him for the opportunity to use a sampler. He told us that even though we may not be interested, we still required to listen to the 90 minute presentation, so just indulge him. We said fine, but we need to leave right after because we made a promise to our boys. He asked us our reasons for not wanting to go with Diamond. We explained that we were tired of spending so much in maintenance fees, exchange fees and Interval International fees. He asked us why we had been interested enough to consider Diamond. We told him that we had wanted the opportunity to trade our Westgate week to Diamond to become points so that we could break our week into pieces. He told us “the best part about being with Diamond is you no longer have to pay Interval, deposit and exchange fees because Diamond pays all of that“ We asked him how that could be possible. “He said, “When you are with Diamond, all of the fees are worked into this point system”. (This was not true. We did not find that out until November 2011) He said there must have been things that the other salesman didn’t tell us. We told him that everything we talked about should be in the system. This is when we realized that absolutely nothing that we had discussed in Phoenix had made it into any “system”.

• Mr. Benkert then told us that what is great about being with Diamond is you no longer have to make requests for certain locations and wait for long periods of time. He said, “You never have to worry about availability- there is always availability- you would no longer have to call about whether there is room”. (This sounded too good to be true and several months later we did find out it was too good to be true.) We told him that since we farm, many times our trips are last minute and we normally drive to nearby resorts right in the Midwest, which would be Interval International resorts not strickly Diamond resorts. He said, “That would be perfect because Diamond has a special agreement with Interval, so that when you book more last minute getaways, you would only spend 50% or even 25% of the point value. Plus since you are dealing with points, there wouldn’t be any crazy exchange fees like we pay now with Westgate.” We were very excited about this because we are always planning our getaways completely last minute. (We found out this is not true. Not only are there exchange fees, there are also deposit fees)

• We then told him this sounded great but we definitely do not want two sets of maintenance/assessment dues. We told him the salesman in Phoenix had said that we could trade our Westgate week into Diamond and since it was such a high demand week, this was definitely workable. Mr. Benkert said, “I am not aware of any negotiations that you discussed while in Phoenix regarding the value of Westgate, so I will have to go talk to my people.” At this point, it had been nearly two hours. We realized that clearly we could come back at another time to discuss Diamond options. We thanked him for his time, began packing up our boys and stood to leave. This is where Mr. Benkert became quite intense. He said, “Why would you leave before we are done? Are you trying to make me look bad in front of my boss. That group of people standing there behind you is upper management and if I don’t do the required parts of my presentation, I will be risking my job. “ He specifically pointed out one woman and one man wearing a gold chain. He then insinuated that his job was on the line. Then he pleaded, “How could you do that to me? I have been nothing but polite and courteous to you.” We told him, we agree that he had been polite up to that point and that it wasn’t personal but that we were leaving. We told him we are not trying to do anything to you and that we have been in these presentations before and that we were tired of the guilt tactics. We told him we are not going to buy or trade and that it that. He then said, “Well OK then but you need to give me a specific reason of why you aren’t so that I can document it for the file, and then you can go” It appeared that he didn’t care what we did or didn’t want. (This is where the pressure truly started. The lies, fabrications and manipulation just exploded as over the next hour there was a sea of people coming to our table to convince us of what we needed to do.)

• Eventually, the sea of people and telling us what we needed to do came to this. Mr. Benkert knew that we didn’t want to lose our investment of Westgate back in 1998. According to my notes, he said, “If you don’t want to lose your investment of $10,000 with Westgate, you are going to want to get rid of it now by trading it into Diamond. Westgate Lakes timeshare’s are not going to be around much longer. I have assisted many people just like yourselves that desperately needed to switchout their weeks to points. Most of the companies that strictly do week trade have already shut down. Westgate is one of the last ones standing. Diamond has bought out most of them.” We asked if it was possible that Westgate would just switch to points? He said “absolutely not that their system is set up in such a way that their board of directors could not make that kind of switch. If you don’t trade in now, your Westgate is going to continue to drop in value until it is worth nothing.” We asked how he could know that. He said, “I honestly have no complaints about Westgate. I had a week with them but realized as I watched the “happenings” of the company, because of what I am doing now, that if I didn’t drop it when I did, I would lose my entire investment.” Considering that he too had had a week with Westgate, seemed to make us think we should listen to him. We asked him to see what he could do for a trade in value.

• After about an hour, Mr. Chad Benkert and Mr. Kevin Fell who just both happened to be licensed pastors they told us, said that our Westgate was worth 5500 pts to Diamond. However with trading it in like with car, the value drops to only 2500 points. Since purchasing 3000 points from Diamond was the minimum you could do and was extremely expensive they said they could bring it down to approx. $10,000, by trading in our Westgate week. That would give us 3000 points a year and just the one set of Assessment dues. We realized that we would only have enough points for a week of vacation every other year. This was OK because then we would still have a assessment fee for the points but it would be a lower fee then we were paying to Westgate and more importantly, we would not completely lose our initial investment with Westgate. We thought about it, and decided this could work.

• We began getting ready for signing the agreements when Mr. Benkert came back to out table. He mentioned that we still had a week with Interval International through Westgate that had been deposited and not used. He said, “You will lose that deposited week, if you sign the papers today.” We said that considering we have no other options, we will have to forfeit it in order to make this trade in work. He then told us to wait a moment to see what he could do. This time both Mr. Benkert and Mr. Fell sat down at our table. Mr. Benkert said, “because at this point your Westgate is a valuable week according to our system, we think we can help you out so that you don’t lose your week that you already have deposited.” Mr. Fell said “Since your Westgate week is a high demand week, we can make an exception for you. Mr. Fell said “We rarely are able to do this, but these are special circumstances. You can continue to use your Westgate week by simply “giving” it to us each year. You would receive 5500pts each time plus you will still have an additional 3000pts through Diamond.” We were in shock, we couldn’t understand why we were able to buy 3000 pts at a discount without actually trading in our week. Mr. Fell said, “because we would still be getting your week to make available for all of our other Diamond customers to use anyway, but you also can benefit from it too.” At this point, Mr. Fell was called from our table so we were left with only Mr. Benkert. We told Mr. Benkert that this wasn’t what we wanted because we would then be paying maintenance on TWO timeshares and that there was absolutely no way that was what we could do. He said, “The great thing about Diamond is that you can dictate when you want your assessment fees due. We can set it up to keep your Westgate in January and then your Diamond can be due in June” We said well what about our Interval International dues? He said , “Once you use that deposited week with them, you no longer have to pay a dime extra with II. You will be all done with them because once you give your week to Diamond, you don’t have to worry about all their fees anymore.” “By doing your agreement this way, you will have enough points to take two weeks vacation on one year and one week on the other.” We asked, how do we do give our week to Diamond? Do we sign something right now so it happens automatically? Mr. Benkert said “no, because your 2009 week has already been deposited so it is yours to use like normal, so you will have to still pay your exchange fee this time. However, in January, once you have called Westgate and paid your maintenance fees, simply call Diamond to deposit your week with us. It is no different then how you do it now. You will just be calling Diamond instead of Interval International.” According to my notes, he had me write down – “still pay maintenance fees on Westgate Property worth 5500 points to use with Diamond. “It’s that easy, nothing complicated at all.”, he said. (This was not true. We could not just call Diamond and deposit our week. There was a fee to deposit, no guarantee of the 5500 points and a form had to be filed before a deposit cold even take place.)

• We then asked about using the points and how to save them up. He said each year by May or so you want to make sure you contact Diamond to have the points carried over. Once you do that you don’t have to worry anymore. They are there for you to use. We then asked, since it is already February and 3000 points isn’t enough to use for a vacation, can these automatically be carried over? He said, “Yes, I will make a note of it right now that these points will be placed to carry over. So you won’t be required to call to inform Diamond by May, they will already know. You just want to make sure that you pay your Assessment Dues in June, so then it will automatically set up every June to have your Diamond Assessment fees due.” We told him that sounded OK. We would plan to pay Diamond dues in June and Westgate in January. Then he said, “be sure to call Diamond right after you pay them so they get deposited.” We again verified, there is no additional fee right? Mr. Benkert said, “absolutely not, just a phone call and that is it, you won’t have any additional fees will June when you pay your Assessment dues”. (Again, there was a fee and paperwork. Also, Mr. Benkert never made a note of our points being carried over.)

• So as far as our Westgate trade in, do we simply contact you as soon as we use that week we have deposited with Interval International? He said, “yes, when you have used it then contact me. You are going to want to trade that Westgate to us as soon as you can, definitely within a couple years.” We told him that we were going to try to use it this next summer, so that may be before our Diamond June 2011 Assessments were due we could make the trade. We made it clear that we did not and could not continue to pay TWO Assessment dues to TWO companies. He told us that sounded great, he said, “I will be able to help you to take care of that trade as soon as you are ready.” We asked him if we had to worry about the value dropping because of everything that he had said prior. He said, “I can’t totally predict it, but certainly within a couple years, you will be just fine. “ (Since we had so many other promises end up being lies, we decided to ask about this already. Mr. Bagnato the Quality Assurance Manager said that this was completely untrue. Diamond does not just accept or buy timeshares.)

• At this point, it had been 5 hours since we had arrived. Our kids were at the end of their rope and we were at ours. It took a half hour for them to put the paperwork together. I had taken very specific notes regarding all the information that Mr. Benkert and Mr. Fell covered. I verified answers to our questions just as they had answered them. So as we finally we escorted to Mr. Peter Bagnato, Quality Assurance Manager, we just wanted to sign everything we had agreed to with Mr. Benkert and Mr. Fell. We wanted to finally be free to leave with our little boys. We looked at the stack pf paperwork and asked Mr. Benkert if the information in the stack was the same information that we just went over. He said that it was exactly the same. We had no concerns that the paper work that we were signing was any different than all the information that we already had written down. The few things I did ask were accurate so we signed and left. Within two days the amount of $10,318.00 had been charged to our credit card.

We were confident, based on what we were told by Mr. Benkert that we had made the right decision. Even when I paid our Assessment dues May 5, 2010 for $777.60, it raised no alarm for us. It wasn’t until November 30, 2010, that everything came crashing down. I had called Westgate to pay our maintenance fees earlier than normal and told them I was planning to deposit our week with Diamond. Our people at Westgate were very confused and said that this wasn’t how things work. I got alarmed and called Diamond immediately. When I finally explained everything to a Diamond representative they said that I could just make a phone call. She said that we were required to send in forms and those forms would have to be evaluated by the Diamond sales department to determine the value of our week. Then we would be informed in writing of the value so that we could decide if that was what we wanted. On top of that, we had to pay $100+ fee for this to happen even though Mr. Benkert said that there was no fee and had quoted us a 5500 pt value. The salesperson that we spoke to said that she could not qarantee that amount. I then tried to contact Mr. Benkert only to find out that he was no longer working for Diamond. So I tried Mr. fell, only to find out that he was also no longer working for Diamond. I eventually was able to get in contact with someone that said that they were management but they were not able to help me. Plus, they informed me that our Assessments were going to be due again this January. I explained that we had set them up to come due in June. She wanted to know what in the world I was talking about. She said that all Assessments are due in January of each year and no exceptions are made.

I went back to my notes from our conversation with Mr. Benkert because I had remembered that I told him I wanted his cell phone number that day. I wanted to be sure I could get ahold of him if all of sudden he “wasn’t around”. After a few weeks of making attempts, I finally got ahold of Mr. Benkert. He was shocked that we had run into problems. He told me that because of a family crisis he had to take some time away from Diamond but was planning to return. In the meantime, he didn’t have any of my information available so he told me to contact Mr. Fell. I told him that Mr. Fell is no longer working there either. Then he told me to call Carol who was Mr. Fell’s manager and he gave me a phone number. After almost a month, I was able to finally get ahold of Carol. She couldn’t understand why Mr. Benkert would have given me her name when she has nothing to do with the sales. She then told me to contact Mr. Bagnato from the Quality Assurance Manager.

I eventually was able to speak to Mr. Bagnato. After a lengthy explanation of what we had experienced, he said that there was nothing that I could do. He advised me to make a detailed list of the misrepresentations and fraudulent activity in order to be released of this contract and get our money back. Specifically the fees, value of timeshare, due date of assessment fees, carry over of points, high pressure, promise to buy our westgate week and others listed above. Some of the names that he gave me were Tony Kowell, David Warner, Steve Kluback. Mr. Bagnato told us to send a letter to the legal department of Diamond.

In closing, we are sending this letter listing all of the misrepresentations and want to cancel our contract with Diamond because of these events. We expect to receive back monies we have paid totaling $11,095.60.

We were also advised by our attorney to send a certified copy of this letter to the states regulatory agency, the Better Business Bureau, Federal Trade Commission, Orlando police departments, and other governing agencies that will want to made aware of this situation.

Thank you for your prompt attention to this manner.







     
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User Replies:

jktshff1 on 2011-04-18:
Good review, but ya got a long story short version?
Anonymous on 2011-04-18:
I quit reading 1/4 way through. I've never met anyone happy with thief timeshare. I guess this explains why they exist.
devil_advocate on 2011-04-18:
I had the same issue, they told me it was not fraud, because I signed or initialed a clause in the purchaser's understanding which basically states no matter what I was told, if it isn't referred to in the purchase agreement, diamond doesn't have to abide by it.. Translation: I agree that my sales rep can feed me a bunch of bull, however if that bull ain't in the contract, it's perfectly legal and not fraud.
Proud Sales Person on 2012-01-18:
Sounds like your lawyer added his own "sales pitch" in this letter.
JP on 2012-12-13:
Excellent story, I read every word. I professionally take time share presentations for the freebies. Just finished a DI tour last week and have another one booked 6 months from now. Before each tour I make sure to do a complete background on the company and the property. This helps me spin circles around the sales person. Generally they want me to leave after the 2 hour presentation.
ccampbell on 2013-01-03:
Any resolution to this?
AR on 2013-04-11:
We have been looking into a time share, but these horror stories freak me out. Does any have any advice for us? Where to start? Can we do a time share sampler (as I hear they are called) TIA
Barbara Mahoney on 2013-06-11:
I am about to launch a very similar letter with a similar amount of money owed. What happened with your claim?
Harriet Mendler on 2013-08-10:
Timeshare Cancellation: Also known as timeshare exit, timeshare disposal or timeshare elimination, there are many timeshare cancellation companies that claim to be able to cancel your contract and recover your money, but most of them have very vague statements about how the fees are charged. http://www.timesharescam.com/blog/71-timeshare-cancellation-companies/
WK on 2013-09-21:
If you buy a timeshare, buy it on Craigs list for pennies on a dollar....they are enough dissatisfied customers that nobody needs to pay 4 to 10X to buy a "new one" (I.e. frequently same properties as "used" ones)
Ave castaneda on 2014-04-02:
All of what I read sounds so familiar to what this company did to us they're a fraud, and we can't win, anybody has an idea of what to due to get our money back?
John White on 2014-04-08:
The Same as everyone else. Cloobeck the owner has no shame and is desperate for money so you are stuck. Sorry!
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