LONDON (December 21, 2010) — The OFT (Office of Fair Trading) has launched court action against three companies and individuals involved in the marketing or sale of holiday club memberships and other similar products, alleging that the traders mislead people about the sale of their timeshares.
The companies subject to the court action are Incentive Leisure Group Limited, Personal Travel Group Limited and Geo Demographic Market Research Ltd (previously known as the Direct Marketing Partnership Group Ltd).
The OFT alleges that these companies encourage consumers to attend presentations, on the basis that they would be able to get rid of unwanted timeshares with often high management fees and at these presentations, consumers are instead sold very expensive holiday club memberships. In some cases consumers were invited to join what appears to be a pyramid scheme, on payment of a large fee.
The OFT claims that the traders involved engaged in aggressive and misleading sales techniques and believes that consumers attending these presentations are denied cancellation rights provided by consumer protection laws.
Solicitors acting for the traders have denied the allegations made by the OFT and are expected to defend the action.
Jason Freeman, an OFT Legal Director in the OFT’s Consumer Group, said:
‘We are concerned about the impact these traders’ activities are having on consumers, and in particular that they are being misled and denied important rights. We have not been able to reach a voluntary agreement that they will cease the activities that we consider to be unlawful, so we think the best thing now is for the High Court to decide the matter.’
At this point, no assumption should be made that any business or individual has been found to have breached consumer protection legislation.
- The OFT is also taking parallel court action against Keith Barker, Martin White, Kimberley Bambroffe, Jonathan Daniels, Mark Gales, Robert Knight and Lily Alderson who are involved in the management and sales of the companies involved in this case.
- See the case summary in respect of this investigation.
- The OFT began to investigate this matter following a referral from a South East Regional Scambusters Team and the receipt of consumer complaints.
- The investigation which resulted in the launching of the court action has been taken under Part 8 of the Enterprise Act 2002. The court action is also taken under Part 8 of the Enterprise Act 2002.
- The OFT consulted with the companies and individuals above asking them to sign appropriate undertakings. Although some agreement was reached the businesses have denied all allegations made by the OFT and sought substantial amendments to the proposed undertakings which the OFT has not agreed.
- Under Part 8 of the Enterprise Act 2002 the court may make an enforcement order which requires the companies and individuals named to cease or discontinue any breaches of consumer protection laws that may have occurred.
- Under Part 8 of the Enterprise Act 2002 the OFT and/or the court may accept appropriate undertakings from the companies and individuals concerned in which they have agreed to cease or discontinue any breaches of consumer protection laws.
- The OFT is of the view that the relevant consumer protection laws in this instance are the Consumer Protection from Unfair Trading Regulations 2008 (CPRs); the Cancellation of Contracts made in a Consumer’s Home or Place of work etc Regulations 2008 (the CCRs); and the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCRs).
It is now for the court to decide whether the activities of these companies and individuals have breached the CPRs, CCRS and the UTCCRS.
- The OFT does not provide advice or resolve individual complaints for consumers. Consumers who are concerned they have been unfairly treated or want advice on their personal circumstances can contact Consumer Direct.
SOURCE: Office of Fair Trading