Florida Woman Arrested for Role in $6 Million Timeshare Resale Telemarketing Scam
Stephen R.Wigginton,United StatesAttorneyfor the SouthernDistrict of Illinois, announced today that Kathryn G. Garten, 51, of Orlando, Florida, was arrested today in Orlando, Florida, by the Orlando Police Department on an indictment returned on November 16, 2012, by the Grand Jury sitting in East St. Louis, in the Southern District of Illinois. The indictment charges Garten with one count of conspiracy to commit mail fraud and wire fraud in connection with telemarketing. The indictment alleges that Garten (who used the alias "Porter Sullivan" and "Loreen Rinehart" to bilk consumers) and others were engaged in an extensive telemarketing scam which operated in Orlando, Florida, bilking thousands of victims of approximately $6 million dollars, and victimizing consumers throughout the United States, Canada, and other countries. There were victims in seven of the thirty eight counties comprising the Southern District of Illinois.
The criminal indictment alleges that Garten was a telemarketer who worked for National Solutions and related companies located in Orlando, Florida. The scheme operated under more than a dozen business names including Bluescape Timeshares International, Country Wide Timeshares, Countrywide Timeshares MA, Landmark Timeshares, Propertys Direct, Quicksale Propertys, Sun Property Networks, Sun Property’s, Universal Propertys, VIM Timeshares, Propertys DRK, Quick Sale Advisers, Quick Sale International, City Resorts, Resort Advisers, American Timeshares, Exit Week, and Resort Advisors International. The indictment alleges that Garten’s participation in the scheme began in April, 2008, and continued through July 13, 2011. The indictment alleges that telemarketers for National Solutions placed cold calls to timeshare owners and then falsely represented that their company had actual buyers for the owners’ timeshare property. Telemarketers then solicited advanced fees of up to several thousand dollars from each victim in purported closing costs that they promised would be refunded to the owner once the closing on the property occurred. Many timeshare owners were told that their closings were scheduled within a number of days. Despite collecting fees from these victims, these companies were not successful in selling a single timeshare unit, the indictment alleged. Garten and her co-conspirators, the indictment alleged, simply pocketed these supposed closing costs.
If convicted of the charge, Garten faces a term in prison of up to twenty five years, a $250,000 fine, and five years supervised release.
The Federal Trade Commission investigated the National Solutions businesses and brought a civil complaint in the United States District Court for the Middle District of Florida in Orlando. In that action, the FTC seized the offices and records of National Solutions on July 13, 2011, pursuant to Court Order.
This new indictment follows the successful prosecutions of two other timeshare resale schemes by the United States Attorney’s Office for the Southern District of Illinois during the last three years.
This prosecution follows an investigation by the Midwest Region Office of the Federal Trade Commission and the St. Louis Field Office of the Chicago Division of the United States Postal Inspection Service. The prosecution of the case is being handled byAssistant U.S. Attorneys Bruce E. Reppert, Michael J. Quinley and Special Assistant U.S. Attorney Katherine L. Lewis, as well as U.S. Attorney Stephen R. Wigginton.
Consumers who believe that they have been the victim of a consumer fraud should call the Federal Trade Commission 1-877-FTC-HELP (1-877-382-4357) or file an online complaint at https//www.ftccomplaintassistant.gov.
Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.