The Old Blue Seas Timeshare Scam
History of
the Playa del Sol/Blue Seas Resort
Blue Seas Resort is a condominium/hotel complex
consisting of 66 units. It is more of a
“boutique hotel” than a “resort”. Of the
66 units, there are 6 full-time owners (including the two penthouses) and about
250 fraction owners (a specific 28-day period in a specific unit) who all have
deeds to their property. People began
buying fractions in 1999.
Naturally, the early buyers purchased their
fractions during the winter months when it is cold in the U.S. and
Canada. By 2001, all of the preferred
units, and most of the winter months were sold.
The developer quickly discovered that his remaining
“off-season” and summer fractions (during the hot rainy season) were basically
unsalable, so he decided to switch gears and convert his remaining fractions (just
over 50% of the total available) to a timeshare operation. Sales began in 2001. With a timeshare, there is no deed, or
guarantee of any specific week or specific unit. Switching to timeshares allowed the developer
to oversell the winter season many times over to unsuspecting buyers, who are
never told how many other timeshare owners they would be competing with for a
week’s stay during the winter season.
Timeshares were mainly targeted and sold to
the gay and lesbian community. The name of the complex from 2001 to 2009 was Playa
del Sol. After 8 years, the hundreds,
and maybe even thousands of people who bought timeshares were thrown out and
told they must use their timeshares at other locations, all far away from
the gay beach. The developer was
well aware that the majority of his customers were gay and wanted to stay on or
near the gay beach, but was totally uncaring.
So how did he accomplish this scam?
A timeshare contract is not by and
between the buyer and a building, but rather between the buyer and the
corporation that owns the building. If
the building is no longer owned by the corporation, the buyer is basically out
of luck. In this case, the owner merely
formed a new corporation (with a small change in stockholders) and sold the
complex to the new corporation. The
new corporation, now operating under the name of Blue Seas Resort, is targeting
the gay community once again and reselling the same time over again. Based on the developers history, it is doubtful
that any new buyers will ever be able use their timeshare at the gay beach
location.
The New Blue Seas Timeshare Scam
What Blue Seas Salespeople tell you (The Pitch) verses Reality!
The
Pitch: Blue Seas is owned by PGM Corporation,
a very reputable and well-regarded hotel and timeshare development company.
Reality:
PGM are the initials of the owner’s wife. The owner, Ken Molinaro, is an American,
living in Mexico and married to a Mexican.
He is known for scamming his customers for years. When you Google “Ken Molinaro”, you’ll see that
there is nothing but complaints.
The
Pitch: The owner decided to rename and
rebrand the property from its former name “Playa del Sol” to “Blue Seas Resort”
because of his desire to help strengthen and promote gay tourism here on the
gay beach.
Reality:
The owner is not gay and is only interested in making money from the gay
community by operating a timeshare scam and capitalizing on the success of the
famous “Blue Chairs Resort”, a gay hotel just two buildings away on the beach; hence
the name “Blue Seas”.
The
Pitch: This is our beautiful Model (Unit
#602), and all our units are going to be refurbished like this one.
Reality:
Unit #602 is the only unit that
has been refurbished since the building was built 10 years ago. It is just a
“show unit” to help make timeshare sales. The rest of the units in the building are old
and may never be refurbished. There is
no provision in the contract you sign that requires Blue Seas to refurbish any
more units, ever.
The
Pitch: Here are the architectural
drawings for our Resort’s new Spa and Gymnasium.
Reality:
Architectural drawings are cheap.
There is nothing in your contract that requires Blue Seas to ever build
a Spa and Gymnasium, or build anything else the salesperson might tell you is
coming.
The Pitch: The price of $28,000 for a one week timeshare
at Blue Seas is a great deal because it includes membership in our Beach Club,
which other gay couples pay $4,500 per year just to belong to.
Reality:
There is no “Beach Club” and no one has ever paid anything to belong to
one. In addition, there is nothing in
your contract that even mentions belonging to any beach club. Anyone staying at the hotel has the same
amenities as a supposed Beach Club member.
This is just a way to jack up the price.
The
Pitch: The annual Maintenance Fees are
only $700.
Reality:
This amount is about twice as high as annual fees from similar
timeshares. In addition, the contract
provides for Blue Seas to raise your Maintenance Fees 10% per year. Your timeshare is for 25 years. Compounding at 10% adds up fast. For example, in year 15 you would be paying
$2,658 per year, and by year 20, the fee jumps to $4,281 per year.
The
Pitch: You can pay only 25% down and
finance the balance over 7 seven years.
Reality:
The interest rate is 16%, about three times as high as it should be. In
addition, you are made to sign a Promissory Note, which is then sold to a
finance company in the U.S. A Promissory
Note is an unconditional promise to pay!
All notes start out with the words “For Value Received”. These words mean that you are happy with what
you got at the moment you sign it. So
even if the building burned down, you would still have to pay the total amount
of the note, along with interest.
The
Pitch: A timeshare at Blue Seas Resort
is a good investment for the future!
Reality:
Your timeshare at the Blue Seas Resort will be worth less than half of
what you paid for it the moment you walk out the sales room door! This is because approximately half of what
you just paid went to pay marketing costs and sales commissions. You can
see for yourself what the resale market is for timeshares. Just Google:
“Timeshare Resale’s”.
A Concluding
Thought
If Blue Seas was an honest and reputable
company selling timeshares, then why is it that prospective buyers are: (1) never provided with any financial
information about the company, (2) never told how many other timeshares have
been sold that they would be competing with for a winter season reservation, (3)
never given any references of other satisfied customers, (4) never allowed take
the contract or any other documents out of the sales office for review, and
most importantly, (5) NEVER ALLOWED TO THINK IT OVER!
Why all the closed door secrecy and “must
buy now” high pressure sales techniques?
The answer of course is that, you might discover you’re being scammed!
Be
careful as the sales process starts by someone on the street asking you to fill
out a simple survey in return for a free breakfast or lunch at Blue Seas!
If you have already been SCAMMED…
If you bought a timeshare
between 2001 and 2009 and are not being allowed to use your timeshare at the
Playa del Sol (Centro) location (the gay beach location), and you wish to join
a lawsuit to try and obtain a full refund of all monies paid, with the
additional possibility of punitive damages, please do the following:
Your documents will be
reviewed and you will be notified as to whether your case qualifies to be
included, be given further details about the case, and then asked if you wish
to proceed.