“Timeshare clubs violating Consumer Protection Act”
A probe into leisure companies offering timeshare will likely show they have violated the National Consumer Protection Act (NCPA), the Freedom Front Plus said on Monday.
"We actually asked for the National Consumer Commission's (NCC) investigation to investigate the industry. There had been many complaints from many stakeholders," the party's Gauteng premier candidate Anton Alberts said in a statement.
The party submitted the complaints to Parliament's portfolio committee on trade and industry, which oversees the NCC. It also urged the NCC to investigate.
In June last year the commission's head of enforcement and investigations, Prudence Moilwa, said there had been so many complaints about holiday contracts in the timeshare industry that it was decided to launch a large-scale investigation.
In 2011, the NCC received 781 complaints and last year 596 complaints, which included travel and budget-holiday clubs.
Alberts said the commission had finished its investigation, and a final report had been prepared. While he had not seen the report, his discussions with NCC members showed they were "aghast" at what they found.
Alberts said 41 of the main clubs were placed under investigation.
"If you look at what's happening in the industry at the moment, there is a real concern that the NCPA is being disregarded by the industry," Alberts said.
"We are sure that it [the report] cannot come to any other conclusion than that the main players are acting in disregard to the NCPA."
This meant that scheme members who were stuck in perpetual contracts could now exit them.
The industry needed to ensure there was adequate stock available for what was being sold.
"The overselling of points is actually creating a type of pyramid scheme," said Alberts.
"We are quite confident that the report will fix a lot of problems that people have been experiencing with these contracts and at least there will be a fair basis on which to enter and exit such contracts."
He said the FF Plus understood the main players in the industry had made submissions to the NCC and acknowledged they were at fault.
What concerned the FF Plus was that it appeared NCC members conducting the investigation had been intimidated by people apparently linked to the industry.
"If the clubs continue with that [the intimidation] we are going to lodge criminal charges against them," Alberts said.
"People are basically unhappy about the product. Given there are around 700,000 members in South Africa, and if it's not dealt with adequately, these clubs will be making money illegally."
The NCC could not immediately be reached for comment.