Do Your Due Diligence
| August 03, 2011
A staggering 678 complaints about an Alberta-based timeshare company and resulting three-year investigation has led Service Alberta to lay 192 charges under the Criminal Code and Alberta’s Fair Trading Act. Hundreds of consumers who paid anywhere from $4,000 to $40,000 to enter timeshare agreements with the companies were left in the cold when the timeshare properties went into foreclosure and consumers could no longer access their units.
The charges include 168 Criminal Code counts of fraud over $5,000 and 24 Fair Trading Act charges of misleading or deceiving consumers; misrepresenting a consumer’s rights, remedies or obligations; and using exaggeration, innuendo or ambiguity of material fact in a consumer transaction.
A little bit of due diligence may have prevented many consumers from losing tens of thousands of dollars. A quick web search of the companies and individuals involved in these charges brings up dozens of results relating to similar charges under the Fair Trading Act in 2007 and 2004.
Consumers should always carry out an appropriate amount of due diligence when entering into any contract, including service (agency) agreements, purchase and mortgage contracts, and leases. If someone you are dealing with is operating a scam, it is quite possible others have been victimized in the same way and you may be able to uncover an online trail of deceit or complaints about the company in question.
Before entering into any contractual agreement, especially one where thousands of dollars is involved:
- Perform a web search on any parties (or properties) involved, including companies and individuals.
- Ask for and contact references
- Perform a land title search on any property involved
- For extra piece of mind, consult a lawyer
And don’t forget if you’re contracting with a company or individual for a service or product that requires licensing – make sure you confirm their licensing status with the appropriate licensing authority. For instance, timeshare companies are licensed through Service Alberta, and Alberta real estate associates and brokers are licensed through the Real Estate Council of Alberta.