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Barclays credit arm sued by 106 holidaymakers over timeshare deals
Sam Barker reports in Money Marketing
Barclays Bank consumer credit arm Clydesdale Financial Services is being sued for more than £1.5m by 106 consumers over a holiday home timeshare scheme.
The group of claimants all bought shares in holiday homes in countries including England, Spain, Australia and Tenerife between 2006 and 2014 through timeshare club Resort Properties.
Silverpoint Vacations took over Resort Properties around 2011, according to High Court documents uncovered by Money Marketing sister title Mortgage Strategy.
The claimants say they were invited to presentations by Resort and Silverpoint where they were given a free week’s holiday in a resort as an incentive.
The clubs then recommended the borrowers take out loans with Clydesdale to fund timeshare deals.
However, the 106 members of the public say the details of the deal were not clear and that they were rushed into signing.
Many of the consumers claim they were told their timeshares were an investment that could be easily resold for profit, helped by the clubs.
They also claim Resort and Silverpoint told them they could rent out their timeshares to meet their repayments to Clydesdale, and that the loan could be paid off by selling their stakes.
However, the claimants say the clubs misled them, cost them money and harmed their credit ratings.
The court papers say: “Representatives of [Resort] and [Silverpoint] were well aware from extensive experiences in dealing with timeshares that the timeshares were not readily saleable at all or at a profit and were not an investment.”
Many claimants say they were not informed they were entering into a credit card agreement, or that there was a variable interest rate.
The consumer group says the clubs blamed problems selling the timeshares on factors like the recession.
The 106 claimants say the clubs then encouraged them to buy further timeshare stakes trying to recoup their initial losses. Many bought more expensive timeshares in a set of resorts called ‘Club Paradiso’.
Edwin Coe partner David Greene, representing the 106 claimants, says the group is targeting Clydesdale under section 75 of the Consumer Credit Act.
The act says creditors can be liable for actions of suppliers.
But Clydesdale denies the claims are valid and says their lack of detail is “embarrassing”.
The lender’s legal response says the claims rest on spoken deals, but that the exact details are not quoted by the 106 claimants.
Further, they say many claims are too old to be brought, and that the laws of the countries the timeshare properties were based in should apply, not the law of England and Wales.
Clydesdale also denies the Consumer Credit Act now applies to it, as the licensing system the law founded ended when the FCA took over consumer credit regulation from the Office of Fair Trading in 2014.
The lender also says the claimants’ contracts fully explained the deals they were getting into and that it does not owe a duty of care to the claimants.
A Barclays spokesman says: “We do not comment on ongoing legal cases.”
Silverpoint did not respond to requests for comment.
Article credit: Sam Barker, Money Marketing