State May Pull License of Largest Time-Share Firm

The state Department of Real Estate has filed an action to suspend or revoke the license of the nation’s largest time-share company--Glen Ivy Properties--and accused the Corona firm of numerous infractions ranging from shoddy record-keeping on customer accounts to making real estate sales without proper permits and disclosure reports, it was learned Thursday.

The 25-page complaint claims that Glen Ivy deposited buyers’ down payments in bank accounts considered unacceptable to the state, permitted unauthorized personnel to make withdrawals and failed to keep customer account records in accordance with state laws.

Deputy Real Estate Commissioner Jerry E. Fiscus claims in the action--which was filed May 6--that Glen Ivy sold time-shares in Texas and in San Luis Obispo without permits and failed to give some buyers of its resort properties state-required disclosure forms. Some available disclosure forms, which give details on the time-share from parking to property taxes, were no longer valid, the complaint claims.

“It’s (the accusation) obviously serious,” said Robert McCabe, the real estate department’s regional manager for Northern California. “If they are not handling trust funds in compliance with the real estate law, we consider it very serious.”

Glen Ivy spokesman Alexander Auerbach said the department’s accusations caught company officials by surprise because they believed the complaints had been largely resolved in past negotiations. The company, which received the complaint Wednesday, denied the charges.

“The company feels that its record of selling 53,000 time-share units to purchasers who are happy . . . and having received less than a dozen complaints over the last three years, all of which were resolved . . . speaks for itself,” Auerbach said.

The department’s action comes just a week after it was revealed that Glen Ivy’s parent corporation--Glen Ivy Financial Group--was under investigation by the California attorney general’s office for possible violations of state telemarketing laws.

Glen Ivy--with sales sites scattered across Southern California, including Newport Beach--attracts prospective clients to 90-minute sales presentations by promising free gifts ranging from a new car to a trip to Las Vegas.

The attorney general’s office began investigating Glen Ivy and an Anaheim telemarketing company after a Culver City man complained last February that he didn’t receive the Cadillac or $25,000 in cash that he was allegedly guaranteed by a telephone solicitor. Glen Ivy has said it is cooperating with the attorney general and deemed the solicitor “a loose cannon.”

The typical Glen Ivy time-share--with one bedroom and one bath--retails for about $10,000. Owners can trade weeks and spend their vacations at different resorts every year if they want. The department’s accusation could now go to an administrative hearing, but Glen Ivy said it will try to resolve the agency’s concerns before they reach a judge.

McCabe said the real estate department began investigating Glen Ivy in 1989 after it received complaints from purchasers. He refused to disclose how many consumer complaints have been filed.

“We had enough to trigger an investigation, and then the investigation discovered things other than what people were complaining about,” McCabe said.

One of the department’s principal accusations is that Glen Ivy deposited customer funds into one large bank account--a procedure not approved by the agency--and did not keep separate records for each customer or transaction.

“How do you tell how much money of whose is in that account?” McCabe asked, adding that Glen Ivy’s record-keeping “did not conform to the real estate law . . . (but) that doesn’t mean they were robbing or stealing people’s money.”

Glen Ivy’s Auerbach denied the charge, saying the company kept “extremely detailed records.”