Authored by Naveen Athrappully via The Epoch Times (emphasis ours),
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned multiple individuals and companies linked to a Mexican cartel for engaging in timeshare fraud targeting U.S. citizens, the department said in an Aug. 13 statement.
“These complex scams often target older Americans who can lose their life savings. The lifecycle of these scams can last years, resulting in financial and emotional devastation of the victims,” the department said.
Cartels typically obtain information on timeshare owners in Mexico from insiders working at resorts, Treasury said. Call centers then contact them, falsely claiming to be third-party brokers, sales representatives, or attorneys from the timeshare industry or sectors such as real estate, financial services, and travel.
“The fraud may include timeshare exit scams (a.k.a. timeshare resale scams), timeshare re-rent scams, and timeshare investment scams,” the Treasury statement said.
“The common theme is that victims are asked to pay advance ‘fees’ and ‘taxes’ before receiving money supposedly owed to them. This money never comes, and the victims are continuously told to pay additional ‘fees’ and ‘taxes’ to finalize the transactions.”
The scammers direct victims to send money to accounts held in Mexican banks and brokerages.
People may be victimized repeatedly, with the fraudsters representing themselves as a law firm that could help them recover lost funds for a fee.
In some cases, the criminals may pose as government officials, accusing the victims of engaging in suspicious transactions and demanding payment of fines to avoid imprisonment.
The Treasury’s latest sanctions target four Mexican individuals and 13 Mexican companies with ties to Cartel de Jalisco Nueva Generacion (CJNG), designated as a Foreign Terrorist Organization by the United States. CJNG is also known as the Jalisco New Generation Cartel.
The sanctioned individuals and companies are based in the popular tourist destination of Puerto Vallarta, Mexico, which also acts as a strategic stronghold of the cartel, the Treasury statement added.
Americans with timeshare investments in the region may be targeted by these scammers.
The Treasury said CJNG was increasingly supplementing its drug trafficking proceeds through revenues generated via timeshare scams.
“We are coming for terrorist drug cartels like Cartel de Jalisco Nueva Generacion that are flooding our country with fentanyl,” Treasury Secretary Scott Bessent said.
“These cartels continue to create new ways to generate revenue to fuel their terrorist operations. At President Trump’s direction, we will continue our effort to completely eradicate the cartels’ ability to generate revenue, including their efforts to prey on elderly Americans through timeshare fraud.”
Last year, the FBI’s Internet Crime Complaint Center received almost 900 complaints related to timeshare fraud schemes in Mexico, with losses of more than $50 million, said the Treasury.
In a June 7, 2024, statement, the FBI warned about timeshare scams.
Assistant Special Agent in Charge Paul Roberts, who leads FBI New York’s Complex Financial Crimes Branch, said there were 6,000 victims of timeshare fraud in the previous five years, with losses totaling over $300 million.
Timeshare fraud may go unreported because the victims either don’t realize they are being scammed or do not know they can get help to tackle the issue, according to the FBI.
“There is nothing embarrassing about falling victim to a scam like this,” Roberts said. “The worst thing that people can do is suffer in silence out of shame or fear of judgment.”
Red Flags
In July last year, federal agencies issued warnings about Mexican cartel-run timeshare scams.
A joint notice from the Treasury and the FBI asked financial institutions to be “vigilant in detecting, identifying, and reporting timeshare fraud perpetrated by Mexico-based transnational criminal organizations (TCOs).”
“Older adults, including retirees, are frequent victims in these schemes,” the notice said.
The TCOs use funds stolen via timeshare fraud to back their drug trade, including manufacturing and selling fentanyl and other deadly synthetic drugs in the United States, the agencies allege.
The FBI lists several red flags Americans with timeshares should watch out for to avoid getting defrauded.
For one, third parties asking for upfront fees or taxes or demanding a power-of-attorney form are suspicious, because these are not industry-standard practices, the agency said.
People claiming to be a government official and threatening arrest or prosecution if money isn’t paid, and those who reach out for some kind of settlement are red flags as well, it added.
“If someone contacts you about your timeshare and requests cash upfront, stop communicating with them, and don’t send them money,” said the FBI.
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