A Mexican drug cartel is targeting senior citizens in the United States by posing as salespeople looking to buy up their timeshares. According to the FBI, Americans who own timeshares have been swindled out of $288 million through various fraudulent scams — including some scams run by the cartel.
Now, U.S. officials are sounding the alarm on what this cartel is doing. The cartel has been successful in many cases, which has led the FBI to warn seniors on what to look out for when it comes to scam artists.
The Jalisco New Generation
While there are many groups targeting elders and their timeshares, U.S. officials have stated that the Jalisco New Generation is one of the main criminal organizations behind this rise in timeshare scams.
The Jalisco New Generation is a Mexican cartel that has slowly worked into more legal sectors of the Mexican economy, though their origins started by illegal means. Now, the group works in both illegal and legal ways.
A Powerful Mexican Cartel
The Jalisco New Generation was created about 15 years ago in Mexico. Since its inception, the organization has become one of the most powerful illegal cartels in the entire country.
Its legal activities include selling avocados to people in the United States. However, the group still works in illegal sectors of the country. They get millions of dollars by running scams and targeting elderly Americans.
How the Scam Works
The scam itself is relatively simple — and incredibly effective. A cartel member pretends to be a sales employee and calls up a timeshare owner, who is often a senior citizen. This scammer then offers to buy up the person’s timeshare investments for a large sum.
However, they don’t give the timeshare owner the money right away. Instead, they ask for money to pay for upfront fees. These fees are said to pay for things like government fines or advertising.
Sending Money
Often, this results in the American citizen wiring a large amount of money to a bank in Mexico to pay for these initial fees. These elderly folks think they’ll end up making it back once the timeshare is officially sold.
However, this doesn’t end up happening. Sometimes, the cartel member says even more money is needed, so more money is wired to them. By the time the American realizes something is amiss, they can’t get in contact with their sales representative.
The Money Is Gone
Once these senior citizens realize that they are part of a scam, they’ve often already sent a lot of their money to a bank in Mexico. In some cases, hundreds of thousands of dollars are sent to these so-called representatives.
Unfortunately, for these people, there’s no way to get the money they sent to these Mexican banks back. The U.S. government has no power to demand this money be returned, as it now lies in another country.
Setting Up the Scam
The cartel sets this specific scam up by hiring people to work for call centers in Mexico. These employees are then the ones who follow a script to try to win over potential victims.
The cartel has also used illegal means to get the information and phone numbers of potential timeshare owners. Many reports have indicated that they bribe employees who work at Mexican resorts. These employees then leak the resort’s guest information.
A High Amount of Victims
According to the FBI, Americans have been tricked out of $288 million, thanks to timeshare scams. This includes efficient scams run by the Jalisco New Generation. However, the FBI thinks this number is likely higher.
The FBI states that many elderly Americans haven’t publicly registered a complaint, as they’re embarrassed they’ve been swindled out of their money. The bureau thinks as many as 80% of people who have been scammed haven’t come forward.
A Common Case
Many people may think falling for these types of fraudulent schemes is uncommon. This isn’t actually the case. One common case occurred to a retired couple named James and Nicki.
The couple got a call from an apparent real estate agent from Worry Free Vacations, which is located in Atlanta. This agent said a wealthy Mexican businessman wanted to buy their Lake Tahoe, California timeshare.
A Huge Mistake
This agent then said that they would broker the deal for the elderly couple. James originally only sent over smaller fees that were a few thousand dollars. These fees were supposed to pay for registration costs and go to the Mexican government.
However, the agent kept asking for more fees — and the price steadily increased. Then, James was told he was being fined by the Mexican government for many different violations. He had to cough up even more money to get this resolved.
Landing in Debt
Eventually, James and Nicki ended up wiring about $900,000 to different Mexican banks. Now, the couple is in debt. Their entire life savings is gone.
James is embarrassed he allowed this to happen and didn’t see the scam for what it was. Because of this embarrassment, he won’t tell his daughters what happened. “I’m sure that if I were asking them, they’d say, ‘How could you be so stupid?’” he explained. “And I asked myself that same thing. I used to think I was fairly intelligent.”
What the U.S. Government Is Doing
Unfortunately, there isn’t much the U.S. government can do, as the FBI can only investigate these scams if local Mexican authorities allow them to. Meanwhile, law firms in the U.S. cannot file lawsuits, as they don’t have jurisdiction to do so in Mexico.
However, the U.S. government has tried to accurately warn Americans, especially the elderly, to beware of these types of timeshare scams. The U.S. Treasury Department has also put sanctions on many Mexican companies and people who are a part of these fraudulent activities.
