Timeshare exit scheme promoter bilked consumers out of $90 million: FTC
Most timeshares are virtually worthless, fees are high and the contracts are nearly impossible to break.
Does it take a scam to escape a scam?
That might be a cynic’s reading of the case of “Consumer Law Protection” and other schemes that took consumers’ money on the promise that they could finally escape from the timeshare scam they signed up for in a moment of weakness.
There are, after all, about as many people trying to get out of timeshares as there are signing up for one, maybe even more. The problem with timeshares is basically that they are virtually escape-proof. This provides an opening for opportunistic operators to smooth-talk those who’ve already shown — by virtue of their having signed up for a timeshare in the first place — that they are willing to throw good money after bad.
In the most recent illustration of this sorry phenomenon is the case brought by the Federal Trade Commission against the operators of Consumer Law Protection and other fetchingly named ventures that preyed on previous timeshare purchasers.
A federal court has ordered one of the key functionaries of the plot, Christopher Carroll, pay $140 million and has permanently barred him from marketing similar services in the future. Of that, $95 million will be paid as redress to consumers and $45 million as a civil penalty.
The court granted summary judgment to the Department of Justice and state of Wisconsin. Summary judgment basically means the judge granted the penalties without the formality of a trial.
Deceptive claims to consumers
In November 2022, the Department of Justice, on behalf of the FTC, and the state of Wisconsin sued a company going by the name “Consumer Law Protection” and related companies. Carroll served as president and CEO of the Square One Group, one of the corporations the defendants used to perpetrate their scheme, along with Consumer Law Protection, Premier Reservations Group, Resort Transfer Group and Timeshare Help Source.
The scheme used direct mail and in-person presentations to make an array of deceptive claims to pressure consumers into paying for timeshare exit services.
These included falsely claiming to be associated with timeshare companies; falsely telling consumers that they couldn’t exit a timeshare without paying the defendants’ exorbitant fees; failing to provide promised refunds; and forcing consumers to sign contracts that they were told they couldn’t cancel in violation of the FTC’s Cooling-Off Rule, which guarantees consumers the right to cancel a door-to-door sales contract within three business days of the sale.
In addition to the $140 million judgment, the court’s order also permanently bans Carroll from advertising, marketing, promoting, or offering for sale any timeshare exit service; from engaging in any deceptive door-to-door sales; and from engaging in other deceptive and misleading conduct detailed in the complaint.
Timeshare blues
Buying a timeshare is the last thing most consumers plan to do when they get up in the morning. But if they’re on vacation, on a cruise or at a convention, they’re perhaps a bit more trusting and relaxed than usual and have more leisure time. So they end up accepting an invitation to a free lunch, dinner or cocktail hour, where they’re sucked into the vortex of a skillful, high-pressure sales extravaganza.
An hour or two later, they’re the proud “owners” of a few hours per year at a resort in some supposedly spectacular setting. But problems quickly emerge. Here are a few that popped up in a quick AI search:
1) High and rising maintenance fees
Even if you’ve paid off the timeshare itself, you’re still on the hook for annual maintenance fees—and they almost always go up.
Fees often start around $800–$1,500 per year and can climb steadily
You pay whether you use the property or not
Special assessments (for repairs, storms, renovations) can add surprise costs
Why it matters: Over time, these fees can exceed the cost of simply booking hotels or rentals on your own.
2) Extremely hard to get out of
Getting into a timeshare is easy. Getting out is not.
Contracts are long-term or even perpetual
Resale markets are flooded—many units sell for $1 or go unsold
Exit companies often charge thousands and may not deliver
Why it matters: You can be financially tied to something you no longer want for years—or decades.
3) Poor resale value (often near zero)
Unlike real estate, timeshares usually depreciate sharply.
Buyers often can’t resell at anything close to what they paid
Some owners literally give them away just to escape fees
Why it matters: It’s not an investment—it’s a prepaid vacation with ongoing costs.
4) Limited flexibility
Despite marketing claims, using your timeshare can be restrictive.
Fixed weeks or limited booking windows
Popular dates and locations get snapped up quickly
Exchange programs can be complicated and costly
Why it matters: You may not be able to vacation when—or where—you actually want.
5) Aggressive sales tactics
The industry has a long history of high-pressure sales.
Long presentations (2–4 hours or more)
Promises of “investment value” or easy resale
Incentives that push quick decisions
Regulators like the Federal Trade Commission have warned about misleading claims in timeshare sales.
Why it matters: Many buyers later say they didn’t fully understand what they were signing.
6) Financing costs can be steep
If you finance the purchase:
Interest rates are often much higher than mortgages
Loans may be harder to refinance
Missing payments can damage credit
Why it matters: The true cost can balloon far beyond the purchase price.
7) Ongoing liability—even for heirs
Some contracts pass obligations to your estate.
Heirs may inherit the timeshare (and its fees)
Getting rid of it later can still be difficult
Why it matters: The financial obligation may outlive your interest in using it.
8) Exchange programs aren’t as easy as advertised
Programs like RCI or Interval International let you swap locations—but:
Availability is limited
Fees apply for exchanges
High-demand destinations require advance planning or extra points
Why it matters: Flexibility often comes with extra cost and effort.
Bottom line
Timeshares tend to work best for a narrow group of people: those who vacation at the same place every year, plan far ahead, and don’t mind rising fees. For most consumers, they’re expensive, inflexible, and hard to exit.