posted 18th October 2021
Victims of alleged timeshare mis-selling have been waiting so long for compensation from Britain’s financial referee that they have died before a decision was reached.
Lawyers have lodged thousands of complaints with the Financial Ombudsman Service against lenders for allegedly making irresponsible loans to customers to buy timeshares.
But lengthy delays at the mediator of financial disputes mean victims have been left in limbo for years without a resolution.
More than 4,500 people have timeshare complaints lodged with the ombudsman but at least a third of these have been ongoing for more than two years, Telegraph Money can disclose. Complainants are supposed to be decided upon within 90 days.
Gary Smith of Praetorian Legal, a law firm, who has been representing hundreds of victims, said his clients had waited six years on average for some form of compensation.
“We were expecting final rulings to come through last week. But once again, as they have done for years, they have pushed everything back,” Mr Smith said.
Some complainants have died while fighting to recover thousands of pounds put into timeshares schemes, through which investors buy fixed weeks at a particular resort each year. Others have been forced to sell their home.
The long wait for justice has also made customers a perfect target for scammers. Some individuals have lost thousands of pounds to conmen who promised to recover their money.
The disclosures come as yet another blow to the ombudsman, which pledged to improve its waiting times earlier this month after it came under fire for a drastic decline in its productivity.
Fiona Smith, 65, from Lincoln, was one of a number of timeshare victims invited on free holidays at the likes of Diamond, Club la Costa and Azure holiday resorts. She says she was induced to borrow tens of thousands of pounds in high-interest loans with partner lenders including Barclays Partner Finance, Hitachi and Shawbrook Bank.
She and other disgruntled customers claim they were aggressively sold timeshares that they were told they could later sell at a profit. In reality the timeshares were virtually impossible to sell, leaving the owners on the hook for expensive loan repayments for years.
A number of timeshare companies – which have always denied any wrongdoing – collapsed, rendering the fight for compensation pointless. Borrowers therefore turned to pursuing their lenders instead.
Mrs Smith has been fighting for five years. In 2018 her husband died of cancer, with the weight of the unfinished battle for compensation hanging over him.
“I know he was very frustrated and anxious in his last days that it was still unresolved and left for me to deal with after he was gone,” she said.
David Ince, 78, from Hampshire, also lost his wife to cancer while he was attempting to get his money back. He said the distress their fight against Barclays had caused had never left her.
Another reader, Christine Budd, 66, from Portsmouth, was forced to sell her home after she stopped working but was still liable to repay a £40,000 loan she had taken out to buy a Club la Costa timeshare she was unable to sell. She has been fighting for her money back since 2017.
“I get at least three calls a week from people claiming to be able to get it back for me,” she said.
Sarah Waddington of Sarah Waddington Solicitors said the delays had “opened up the floodgates” for scammers.
Barclays, which has 1,425 complaints pending, said it was sorry for the delays and was working with the ombudsman to find a resolution.
It repaid £48m to 1,500 borrowers in June for its part in irresponsible lending used to finance Azure timeshares in Malta.
Hitachi, which has 583 cases against it, said it tried to resolve complaints swiftly and called on the ombudsman to resolve matters.
Shawbrook, which has 831 complaints pending, said it was working on a case-by-case basis.
A spokesman for the Financial Ombudsman Service said the complaints were often complex and it was going through the evidence before arriving at its conclusions.