Following a string of consumer complaints, the California Attorney General's Office, San Diego D.A.'s Office, and California Department of Real Estate launched an investigation into Welk's sales practices. Undercover operations revealed that Welk was making false statements and misrepresentations in high-pressure sales presentations at its resort in Escondido, California. As part of the settlement, Welk will establish a robust consumer restitution program that will provide up to $3,550,000 in restitution to consumers affected by Welk's deceptive sales practices. The restitution program:
• Allows consumers who previously submitted a written complaint with the option to (1) rescind their timeshare purchase agreement with Welk and obtain a full or partial refund or, (2) retain their timeshare interest and instead obtain restitution in the form of cash, a resort credit, or additional timeshare points; and
• Provides notice to other potential victims and the opportunity for them to submit a claim for restitution in the form of cash, a resort credit, or additional timeshare points.
The restitution program provides relief to two groups of eligible consumers. The first are consumers who purchased timeshare points from Welk between January 1, 2011 and March 2016 and have been pre-identified as eligible because they submitted a written complaint. The second group are consumers who purchased timeshare points during the same time period, but who have not previously submitted a complaint related to their purchases. These consumers will be notified of the judgment and settlement terms, and will be given an opportunity to submit a claim form.
Additionally, Welk has agreed to injunctive terms that require it to implement a compliance program aimed at educating its sales and executive staff on preventing violations. The settlement also requires Welk to pay a total of $2 million in penalties, and reimbursement of investigative costs.
Welk customers who have questions about the settlement or regarding their eligibility for relief under the settlement should visit www.welkresorts.com/resolution for more information as it becomes available.