Powerful Mexican Cartel Targets Timeshare Owners

The scam started small. After receiving a call from a supposed real estate agent offering to broker the sale of their barely used timeshare to a wealthy Mexican businessman, the US couple agreed to send a few thousand dollars across the border to settle transaction costs. Then they sent more money to settle government fines. Soon, they'd sent $900,000, more than 100 times the price they paid for that dusty timeshare. As the New York Times reports, the anonymous and very embarrassed couple fell victim to a most lucrative venture of the Jalisco New Generation cartel: scamming US and Canadian seniors with timeshares. US officials say the scheme has pulled in hundreds of millions of dollars over a decade. It might even rival the cartel's drug trafficking business, USA Today reports.

Scammers operating out of dozens of call centers bribe resort employees to get guest information—there's some particular concern for clients of Vidanta Group—then call up timeshare owners who are generally older, retired, and looking to sell off assets to benefit their families. It seems like a good time. "The timeshare industry is booming, with $10.5 billion in sales in 2022," up 30% from 2021, the Times reports. But scammers are taking advantage. The FBI has seen a 79% increase in timeshare fraud complaints over the past four years. Over the past five years, timeshare owners have lost at least $288 million through this and other scams, the FBI says, and that's among victims who filed a complaint. Some 20% don't, partly due to embarrassment.

Scammers often tease one more fee that, once paid, will put an end to all others. But that's never the case. Sometimes scammers even manage to trick those owners who've grown suspicious. "New employees call them, sometimes months later, saying that their information was found in a police raid of a call center," USA Today reports. "Enter people posing as government investigators ready to help get to the bottom of the fraud, whose services come with their own costs." One man says he lost $1.8 million, according to the outlet. The FBI can only investigate with permission from local authorities. And in Mexico, the Jalisco New Generation cartel rules "with an iron fist," per USA Today. Indeed, last June, eight call center employees turned up dead after reportedly trying to quit. (More scam stories.)