PHUKET: The provincial government, having attempted to solve the problems of aggressive tuk-tuk and jet-ski operators, is now gearing up to tackle another problem for tourists: timeshare companies.

An initial meeting was held yesterday (June 23) at Provincial Hall to address the problem.

Discussion was held around the many abuses that are occurring within the timeshare industry: aggressive timeshare companies that send irritating touts onto the streets to bother tourists; timeshare operations that masquerade as tour companies; bogus timeshare companies that simply cheat tourists; and the touts themselves, or outside public contacts (OPCs) as they are known in the trade.

The crackdown follows the receipt of increasing numbers of complaints to Patong Municipality from tourists irritated by persistent touts or victims of fraud by timeshare companies.

At the meeting Chairat Sukaban, Deputy Mayor of Patong, said most of the illegal timeshare offices seem to be in Patong.

“We have been battling with illegal timeshare for almost seven years,” Mr Chairat said. “But we’re not even close to solving it. It time’s to take more serious action.”

Nopadon Ployyoodee, the chief of the Phuket Employment Office (PEO), reported there are an astonishing 143 timeshare companies registered with the PEO. He added that 641 infractions of the law governing timeshare touts and fraud had been reported in recent years. Two companies were caught sending OPCs out into the streets to pursue tourist on public sidewalks.

“The PEO allows tour operators to approach tourists both in their own offices and outside them,” Mr Nopadon explained. “Outside’ means a company can set up a booth at a specific point and sales people can work on the sidewalk there.”

Timeshare companies, he said, are bound by the same rules. “A company can’t send OPCs out to bother tourists on public roads. The rules are being bent out of shape.”

Weerawit Krueasombat, the chairman of Patong Entertainment Business Association (PEBA) estimated that around 10,000 people are involved in the timeshare industry in Phuket, and alleged that a billion baht a year was being removed from Phuket’s economy and going to foreign-controlled timeshare operations or fraudsters.

“In some cases, tourist have been accosted by timeshare touts on arrival at the airport,” Mr Chairat said. On the streets, he said, “People who masquerade as staff from the Tourism Authority of Thailand ask the tourists to fill in ‘surveys’ with their thoughts on Thailand, and then follow up with nuisance calls to their hotel rooms.

“At present all we can do is fine OPCs B2,000 if we catch them annoying tourists in public. They pay up immediately. You can’t imagine how much money they can earn every day; when compared with that, the fines are negligible.” OPCs get paid cash for every prospect they persuade to step into the timeshare company office.

Pol Capt Siramate Tanapansiri of Phuket Tourist Police suggested, “We also have to control the reopening of fake timeshare companies. When a bogus timeshare office gets enough money, it will be closed by its owner, who will then open a new office [under a new name], leaving no trace for defrauded tourists.

“The illegal timeshare industry is growing rapidly in Phuket. We won’t be able to control if we don’t control it at the beginning of the process – company registration.”

At the meeting it was decided that the PEO will examine every timeshare company registration and send details to the police so they can check for abuses.

The PEBA’s chairman Mr Weerawit also brought up another point: “We have to solve this problem before implementation of the Asean Economic Community (AEC) in 2015.”

The AEC will, for one thing, allow nationals of the 10 Asean countries to work in other Asean countries.

“Otherwise,” Mr Weerawit said, “there will be more workers from aboard getting involved with this dark business. If that happens, Phuket will be totally ruined.”

A customer of holiday club firm St Frances Marketing has warned others not to sign up to such deals after she was left with £12,000 of debt.

Carol Richards, of Washford, Somerset, took out a loan to join the scheme and said she was promised the firm would be able to buy the timeshare back.

But she said this did not happen and the firm has since ceased trading.

The Association for Timeshare Owners and Committees said Mrs Richards' experience was "rare".

Holiday clubs offer the choice of different locations of hotels for customers and pay an upfront fee, as well as an annual maintenance fee.

'Very silly'
Mrs Richards said she was cold called and later signed up after attending a sales event in Exeter in 2008.

She said: "We were bamboozled, they promised they would buy back the timeshare if it wasn't any good to us, for the same price we paid for it."

Despite paying £12,000 neither she nor her husband have been on holiday through the scheme.

"They told us they would finance it and we could have the holiday and we would never need to go anywhere else for the rest of our lives, we could pick wherever we wanted to go so we eventually decided to sign up for it."

They were asked to take out a credit card loan of £11,995 in their name. The loan was deferred for a year, which she initially thought was a "good deal".

"What swung it for us, was they would buy the timeshare back off us in two years, and make half-payments to us into our bank for the first nine months."

The company promised to pay 50% of the £360 monthly payments for nine months for the credit card loan once the payment period started.

They also promised to help Mrs Richards find a cheaper interest deal on another credit card so that debt could be moved over.

'Put phone down'
However, once the 12 month period ended, she was faced with monthly payments of £360, as well as £1,000 in annual maintenance fees.

Philip Watson, director of the industry trade body The Association for Timeshare Owners and Committees, said: "Most people get cold-called for these sales presentations, put the phone down because they are being cold-called. I don't know of any genuine company that needs to cold call.

"I feel sorry for people like Carol because they haven't actually bought a timeshare, they've bought an expensive travel agency."

Mrs Richards has since consolidated the loan through the charity Consumer Credit Counselling Agency, and she has been paying £50 a month since January 2009.

She said anyone who received a sales call from a holiday club or timeshare should "hang up straight away, don't even speak to them".

In November 2010 five directors from Exeter-based St Frances Marketing admitted unfair trading practices.

They each received a three-year conditional discharge and were ordered to pay costs that added up to £150,000 but Devon Trading Standards did not apply for a confiscation order.

The firm has since folded.

Marriott International Inc. (MAR) moved closer to spinning off its timeshare business Tuesday, filing a initial statement with regulators that named the new company Marriott Vacations Worldwide Corp.

The spinoff's chief executive, Stephen Weisz, said Marriott Vacations is still on track to launch by the end of the year, when it will become the world's biggest stand-alone timeshare business.

Marriott International shareholders will control the company, receiving an unspecified number of shares for each Marriott share in the spinoff. The new company plans to list its stock under the symbol VAC on an unspecified exchange.

The business booked $1.2 billion in revenue last year for Marriott, around 10% of the company's total. Once a hot sector of the travel industry, timeshare demand wallowed in the recession. While the hotel industry has been recovering at a upbeat pace from the downturn, timeshares have continued to lag.

In the first quarter, Marriott International--which operates Courtyard, Residence Inn, Ritz-Carlton and its namesake hotels, among others--reported 22% earnings growth, but tepid demand in North America crimped revenue growth more than expected.

Marriott International shares were up four cents at $35.61 after hours. Through the close, the stock has fallen 14% since the start of the year.