Timeshare Resort Manager Charged with Massive Elder Fraud and Embezzlement, Targeting Timeshare Owners – Millions Gone!

Money that should have gone towards paying for casualty insurance, maintenance and resort expenses instead funded the lavish lifestyle of a timeshare executive that ultimately victimized over 1,000 unsuspecting timeshare owners. Many of the owners were elderly according to a DOJ press release and article by AJC.com.

Katherine Craig, was indicted this week on federal charges of mail fraud. Craig allegedly embezzled over 2 million dollars over a period of years from her employer, the Caribbean Service Group and the owners it serviced. CSG was the management company that operated Woodbourne Estates timeshare and collected fees owed to the resort. According to news sources, the resort which is located in the Bahamas went into probate after the original owners of the business passed in 2010. At some point thereafter, Craig assumed a management role with no close supervision. Records reflect that she soon took advantage of that position and began transferring money to her own personal accounts in the amounts of $1.2 million dollars. In addition, she also converted $450,000 in checks made to CSG into cash and even used the company checking account to write another $300,000 to pay off her personal credit cards. A large sum of these monies were allegedly used for Craig’s gambling excursions, trips and lottery ticket purchases.

With resort funds running low, it appears that Craig started cutting corners to save money that included cancelling the casualty insurance policy. By 2015, storm damage and neglect from the lack of repairs had impacted portions of the property, closing some of the buildings. By year’s end, the resort had fallen into complete disrepair and closed sometime after.  Various complaints filed with the Better Business Bureau reveal that owners became furious about the resorts condition and refusal from CSG to take or return calls. In addition, some owners shared with the BBB that even though the resort had closed, Craig had threatened collection activities if maintenance fees were not paid. Those fees ranged up to $1300 per year. The BBB later detected a pattern and posted a warning directly on the Woodbourne Estates profile. The warning remains currently on the site.

Customer Service Issues

Consumers allege the business closed or dissolved in August 2017. However, 2018 invoices are continuing being received. Consumers claim to have issues regarding the following:

Unable to book, bank, or deposit days for time shares, unable to communicate with business representatives, refund request not being honored, and no credits for booked days that were unable to be used. BBB contacted Woodbourne Resorts and requested their voluntary cooperation in addressing the pattern. To date, BBB has not received a response from the business.

By 2017, the company had dissolved, but apparently continued billing the owners with Craig presumably pocketing the proceeds. As a result of the scheme to defraud these timeshare owners, the U.S. Postal Inspection Service got involved. USPIS is a law enforcement agency that participates in investigations that involve timeshare. In the press release, USPIS made these comments.

“The U.S. Postal Inspection Service takes great pride in protecting the American public, especially our vulnerable older Americans. Those seeking to defraud and take advantage of our postal customers should know they will not go undetected and will be held accountable,” USPIS Inspector-in-Charge David M. McGinnis.

The U.S. Attorney’s Office for the Northern District of Georgia which is prosecuting this case is part of the Department of Justice Transnational Elder Fraud Strike Force. The Strike Force focuses on investigating and prosecuting defendants associated with foreign-based fraud schemes that disproportionately affect American seniors.

At the time of this posting, the defendant has only been charged. Our ConsumerWatchTeam will continue to follow the developments of this case and report updates using our social media channel @FinnLawGroup