Ultiqa Lifestyle Promotions Ltd timeshare sales tactics revealed in court judgment

A court judgment has lifted the lid on tactics used to get Gold Coast holiday-makers to sink thousands into a timeshare scheme which has been slammed by financial regulator ASIC.

Representatives of a timeshare scheme operating on the Gold Coast were urged to “do everything you can” to prevent clients who came to the “grim realisation” they were at sales events from leaving, a court has been told.

The Federal Court on Tuesday ruled that Ultiqa Lifestyle Promotions Ltd breached financial services laws by failing to ensure financial advice given to consumers on dates between 5 October 2017 and 21 March 2019 was in their best interests.

In the judgment on the case brought by the Australian Securities & Investments Commission (ASIC), it was stated that the company’s sales process involved approaching consumers at shopping centres or theme parks and offering them a scratch card.

Consumers were told that if they scratched three matching symbols on the card they had won a prize which could be collected if they attended a 90-minute presentation about holiday ownership.

Holidaymakers were approached at a number of locations on the Gold Coast.

The judgment quotes from a sales manual which advised Ultiqa Lifestyle Promotions representatives about what to do at the presentations.

Under a section titled ‘Clients – The Raw Material’, the manual stated:

“Your job is firstly to keep your client, secondly to relax them, take away their fear and suspicion and lastly and most importantly to sell them.

“Sometimes the hardest part of the job is simply keeping your client, not selling them.

“Once your client is on the Sales Deck they come to the grim realisation that this is a sales environment and what is going through their mind is ‘How can we get out of here?’, and, if you give them the chance, they will.

“DO NOT GIVE THEM THE CHANCE! Do everything you can do to amuse, interest, excite, relax, humour, flatter and if necessary cajole your clients into staying.”

The judgment described the experiences of two couples who had purchased interests in the timeshare scheme after being approached while holidaying on the Gold Coast.

Caterina and Brett Waterford from Altona North in Victoria bought into the scheme at a cost of $17,880 using money borrowed from a related company called Future Holiday Finance Pty Ltd.

The judgment states that the couple had difficulty booking accommodation through the scheme and only used it twice.

When they did, the quality of the accommodation was “quite

average” and not to the same standard as had been shown to them during the presentation.

Couples who bought into the scheme complained that they had difficulty accessing holidays.

Christopher and Rachael Gill from Griffith in New South Wales bought into the scheme for $9900 with finance from Future Holiday Finance Pty Ltd after being approached at a theme park.

The judgment states that the couple have tried to arrange accommodation through the Scheme on numerous occasions without success.

Ultiqa Lifestyle Promotions Ltd was placed into liquidation on 30 April 2021.

It did not appear at the Federal Court hearing.

However the Judgement says that it stated to ASIC that it was “not a financial planner” and “only provides personal advice in relation to Ultiqa Lifestyle, a timeshare product”.

In handing down her decision Justice Downes found otherwise, saying ASIC’s case that Ultiqa Lifestyle Promotions had breached the Corporations Act was “compelling”.

ASIC Deputy Chair Karen Chester said the judgment was “an important decision” for consumers.

“(They) prioritised sales over appropriate advice and ultimately consumers’ best interests,” Ms Chester said.

“Pressure sales tactics used, and even documented in their sales manuals, encouraged sales agents to ‘corner’ consumers into investing in a timeshare scheme that many could not afford.

“Despite paying tens of thousands of dollars in upfront costs and ongoing fees, many could not even book holidays in their timeshares due to lack of availability – meaning they got nothing for their money.”

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Originally published as Ultiqa Lifestyle Promotions Ltd timeshare sales tactics revealed in court judgment