Glen Ivy Agrees to Fine to Settle Civil Charges : Probe: Officials of the largest U.S. time-share resort firm still face a criminal investigation.
Glen Ivy Financial Group, the nation’s largest operator of time-share resorts, has agreed to pay $200,000 in fines and expenses and to employ a former state investigator as a consumer watchdog at its Corona offices to settle civil charges that it misled customers.
The Riverside County district attorney, who led a raid on Glen Ivy’s offices early this month, said Monday’s settlement was just “Chapter One” in a two-pronged action against the company and its officials.
The district attorney, the California attorney general and the state Department of Real Estate also are investigating possible criminal actions by some Glen Ivy officials. Neither Glen Ivy nor any of its executives have been charged with any criminal wrongdoing.
Results of the criminal investigation are not expected for at least a month, said Riverside District Attorney Grover Trask II. Though a number of officials are possible targets, Trask said Glen Ivy itself would not be charged in the criminal case.
Trask said his office now has evidence indicating that some Glen Ivy time-share customers were not given ownership deeds to property they purchased.
More than 100 law enforcement authorities raided Glen Ivy’s offices on Dec. 10 after some former and current employees claimed that the company had oversold time-share resorts in the late 1980s through a complex scheme involving forgery and secret computer codes. The company has denied those charges.
The agreement announced Monday prohibits the company from engaging in some of the activities that are also the subject of the criminal investigation. For instance, Glen Ivy cannot sell a time-share property unless it first gets the owner’s permission or goes through a foreclosure proceeding.
It also requires the company to pay restitution to customers who discover that their deed has not been recorded as required by law.
Several former and current Glen Ivy managers have said in interviews with The Times that the company deliberately did not record hundreds--and possibly thousands--of deeds because some resorts were oversold. Those who complained got recorded deeds--public proof of ownership--as space became available, employees claim.
Glen Ivy officials deny these accounts and say it can take “three months to three years” to record a time-share deed in a few locations, such as Hawaii, but said 95% of transactions close escrow within 90 days.
A Glen Ivy spokesman has acknowledged that the company may have sold more time-share units than space allowed because company sales offices throughout Southern California were operated independently of one another in the late 1980s.
Regulators and Glen Ivy’s attorneys spent days negotiating the civil agreement, which allows the company to remain in business and thereby protects its 1,400 employees and 60,000 time-share owners.
“The point of this (the civil agreement) was to protect the consumer,” said Deputy Attorney General Jerry Smilowitz. “It was never the goal to destroy the company.”
Ralph Mann, company founder and chief executive, has agreed to pay $50,000 in fines and regulatory expenses as part of the settlement.
An unusual aspect of the settlement is the appointment of O. Odell Moon, a certified public accountant and former investigator with the state Franchise Tax Board, as a “compliance officer” at Glen Ivy. He will be responsible for ensuring that Glen Ivy officials obey all state regulations governing the time-share industry.
Glen Ivy, which operates 24 resorts in eight states, has agreed to deposit $100,000 in a trust fund to pay Moon’s salary and expenses.