The corporate regulator has taken action against Ultiqa, its first timeshare product provider, alleging it was dishonest when approaching customers to buy into the company’s timeshare scheme, the Ultiqa Lifestyle Scheme, using financial advisers.
According to ASIC, financial advisers who were authorised representatives of Ultiqa from October 2017 to March 2019, did not act in their clients’ best interests, with some consumers said not to have sought advice regarding a timeshare scheme in the first place and others said not to have been aware they were receiving financial advice.
During ASIC’s investigation, consumers reported to ASIC that upfront costs of joining the timeshare scheme were approximately $10,000 to $25,000, with ongoing fees of up to $800 per year.
“Timeshare schemes are complex financial products. They can be difficult to understand and compare with other products, and involve long-term financial commitments. Consumer harm can and has resulted when consumers are not aware of the up-front costs, ongoing fees or the nature of their investment – like how easy (or not) it is to exit,” said ASIC deputy chair Karen Chester.
“This is the first time ASIC has taken action against a timeshare provider in relation to financial product advice practices. The timeshare industry is on notice to ensure existing compliance and advice practices comply at all times with the obligations on all financial advisers, especially for that advice to be in the consumers’ best interests,” added Ms Chester.
ASIC also alleged Ultiqa’s conduct amounted to a breach of its obligations as an Australian financial services licensee to act efficiently, honestly and fairly.
Ultiqa ceased selling interests in the scheme on 28 January 2020 and was placed into members’ voluntary liquidation on 30 April 2021. The scheme, however, remains active, and Ultiqa currently holds an AFS licence.
Funny how ASIC can amble long is a maze and be blind to matters that affect every day Australians that have beed high pressured into a timeshare usually with the offer of lunch or a flight to view and stay etc etc – a bit like Russell Island in Queensland blocks of land sold at low tide!!!!
ASIC asleep at the wheel again. Everyone knows timeshares are scams, yet ASIC is only doing something about it now? What a lazy and incompetent regulator.
Obviously Financial Planners will be paying the compensation to their clients through the new Compensation of Last Resort Scheme. Nice timing!
Seems like ASIC have had a Covid Holiday for the last 20 years…that being public servants who are told to stay at home, not working and on a holiday with full pay.
ASIC you are only 40 years late on this problem. Well done
Timeshare salespeople have been required to be ARs for years. This is the first time that ASIC have taken action? It beggars belief.
Suspect ASIC only doing it now as Financial Planner will foot the compensation bill. ASIA it seems exists for no other reason other than make the life of real Financial Planners hell.