Olympia couple accused in major timeshare fraud investigation
Their internet and Facebook pictures present them as entrepreneurs and philanthropists, but an investigation by the State Attorney General claims Jonathan and Christine Gibbs of Olympia are the creators of an elaborate timeshare resale network involving layers different company names, including shell companies, devised to make timeshare owners think they had buyers.
"They used a bunch of different company names so that no one would be able to tie them to the actual business," explained Assistant Attorney General Lisa Erwin, lead attorney in the investigation.
Court documents show the Gibbs' timeshare resale and vacation club operation used multiple addresses in Washington, Wyoming, Nevada, Texas and Georgia, while operating out of a four-story office building in Lacey. The offices are now empty, but investigators say the Gibbs' operation netted in excess of $70 million in the scheme.
"This large, complex scheme involved unfair and deceptive business practices that harmed hundreds of victims locally and thousands nationwide," said Washington Attorney General Bob Ferguson.
Ferguson says the investigation was sparked by numerous complaints from consumers and employees who began to suspect something deceptive was taking place.
The case against the Gibbs' coincides with a Federal Trade Commission case against a similar timeshare reseller in the Dominican Republic.
"He got at least $10 million from all over the United States," said for the FTC's Consumer Protection Bureau. "It's a huge amount of money."
Federal and state Investigators say in most cases, timeshare resale scam victims are older and in need of cash, which makes them prime targets for the slick promise that a buyer is close at hand. But, in reality, the buyers never exist.
As for whether the victims ever see their money?
"We try," said Horn, "but more often than not, the money has been spent or has been wired to the Grand Caymans or the Dominican Republic or someplace else. It's pretty tough to get back."
The FTC and 27 states filed more than 80 civil cases on Thursday against dozens of deceptive vacation operations across the country and in seven countries internationally.
In the local case, state investigators accuse Jonathan and Christine Gibbs of transferring ownership of the timeshares to themselves. Erwin says the investigation shows the Gibbs' various companies are holding title to all the timeshares.
"The time share resorts have a couple of options," Erwin explained.
"They can move to set aside the transfer. They can claim that the consumer transfer was fraudulent. They can go and file foreclosure work against the entities -- which I think many of the timeshare resorts are -- and that drives the cost up for the other timeshare owners, because the association fees go up, the resorts costs go up and in the meantime there's nobody using that property," Erwin added.
The AG's office says investigators continue to work on the case in an effort to see that the Gibbs are penalized and that all money possible is refunded to the victims, but acknowledge that in these types of cases, that could be a challenge.
Investigators stress that despite the recent crackdown, dozens of deceptive companies continue to push timeshare resale schemes and bogus travel membership clubs. Regulators urge consumers to remember that regardless of the "pitch," if someone contacts you for any reason and asks for money up front before they provide a service and won't give specifics, it's a scam.