RESORT HOLDINGS INTERNATIONAL Galaxy Properties Management, Michael E.Kelly Galaxy...cheated me out of 22 months rental income..broke contract...on going. Mexico internet
I was led to believe I was investing in a time share lease agreement whereby I would be given a choice of using it,renting it,or having a third party management company rent it for me.
I chose to have a third party management company handle it.I was to recieve 9%percent interest on my investment. everything went fine for about a year and a half. The company which was handling it said they were no longer going to continue this,and I would have to find a new management company.
I was contacted by galaxy properties management,who said they would be glad to handle my investment as they were taking over the previous company's business.Thats when the problem's began.
I would recieve a check one month,then would not recieve one the next month, and this went on, and it kept getting worse. when I would recieve another check,it would be less then my 9%percent.
I would call them and they would tell me they were fixing problem's left from the previous company they took over, and that they were putting new people in place, not to worry.
They owe me for 4 months in the year 2004,they owe me for 5 months in the year 2005,and they owe me for the whole year of 2006.They could not be reached by phone,as I called avalon resorts to find out what was happining.
The resort told me that since hurricane wilma hit, that galaxy was not taking calls,and the resort had nothing to do with them,and could not give me any information about them.
My lease is for twenty five years,and my contract said I had to stay in the lease for 3 years or lose 10%percent if I got out before that time.Also the company who I first had, majestic travel would purchase it from me,but informed me they were getting out of the lease.Galaxy properties has voided the contract, and avalon resorts will not return my origional investment.
The person who sold me the lease Rod Hinkle has since not returned my calls,he was my agent,but since all this trouble,I cannot contact him.I called the number that I always have,but get no answer.I would like to know where to turn,but am in west virginia,and the lease is in mexico..Does someone know anything
about Galaxy?
I have seen where mr. kelly has been put in custody as being one of the major culpurts..also I believe mr Hinkle should be questioned as well.By the way I just found out my timeshare units are in acapulco,when I was told by mr. Hinkle they were in cancun.
I have 4 units at the Avalon Excalibur, when I thought they were at the Avalon Grande.
Sam
Keyser, West Virginia
U.S.A.
2 Updates & Rebuttals
Ernest
San Antonio,Texas,
U.S.A.
IP Fund1 Leaseholders come together
#3Consumer Comment
Fri, April 16, 2010
The leaseholders need to intervene in Kelly's criminal case to protect their leaseholders rights to hold RHI, Grupo Kelly and others civilly responsible! The order appointing the special master obligates the SM to cause Kelly to add Assets to Restitution Fund necessary to make full restitution and pay SMs fees and/or obligates the Court to expand the Restitution Fund to include all necessary Assets to make full restitution to victims and pay fees. The appointment does not preclude victims from pursuing any rights they may have that do not encumber, restrain or dissipate the Assets, enforcement of any rights (specifically characterized as a lien) against the Assets or Legal Structure unless the Court orders otherwise. However, the special master's claim form is contrary to the courts order of appointment. The claim form bars victims not adhering to the Claims procedure from asserting a claim against SM, Claims Processing Agent; Restitution Trust, Kelly Business Entities or any successor in interest to or third party beneficiary of any asset owned by or affiliated with Grupo Kelly The claim form recognizes a possible difference between amount of loss calculated for criminal restitution and that could be awarded a defrauded investor in a civil lawsuit, and that criminal restitution does not supplant a civil judgment. Assets collected by SM will not be available to satisfy any civil judgment against Kelly.
Coming Victim Claim Form (i) D. Waiver/Release (a) terminates leases (b) bars claimant from asserting any claims against SM, CPA and waives claims regarding the universal Lease Program including lease, any assets purchased with proceeds, any remedy entitled to under the Universal Lease Program [waived and assigned in benefit of SM or designee. (c) bars claims against any transferee of or successor in interest to any asset or any third party beneficiary of any asset owned by or affiliated with Grupo Kelly. The special master wants the leaseholder to terminate their leases claiming the hotels can be sold free and clear of liens, however, I believe that they are not canceling all the other timeshares Kelly sold. "Therefore the hotels would not be free and clear of liens". The special master also wants the leaseholders not to hold him responsible for his actions, however, when the court appointed him; the court gave him immunity as long as he did not do anything outside of his appointment. If his actions are in line with his appointment he would have no immunity. Why is he asking the leaseholders to waive their rights to hold him responsible for his actions?
If you sign the claim form you are buying the pig sight unseen and you will have no recourse because you signed your rights away! It is clear the special master is attempting do keep the leaseholders from going after some of the assets and others. It is also clear that his actions are not inline with his appointment. Furthermore the special master doesn't disclose how much of your money will be recovered. For all we know its pennies on the dollar!
If you are a leaseholder and have not joined with other leaseholders please go to (((ROR redacted))) for more information to join.
Ernest
San Antonio, TX 78209
(((ROR redacted)))
Ernest
San Antonio,Texas,
U.S.A.
SEC Charges 26 Defendants in $428 Million Securities Fraud
#3Consumer Suggestion
Sun, September 09, 2007
The IP Fund 1 complaint claims RICO, it takes a big bite out of the wrongdoers and the SEC only paints a picture of greed and fraud. SEC cmplaint makes our case that there were many involved and that they conspired to defraud. RICO! (read below)
I have seen this before and it is very important for everyone to come together under one voice! We expected this to happen and are ready to meet them head on. I believe we will be on the winning side of the argument.
Joel Held one of RHI attorneys wrote in a case filed in Texas claiming securities fraud and RICO: "It is as if the Fifth Circuit of Appeals was referring to the complaint in this action when it observed:" "A Complaint can be long-winded, even prolix, without pleading particularity. Indeed, Such a garrulous style is not an uncommon mask for an absence of detail" Southland Securities Corp. v. Inspire Insurance Solutions, Inc., F. 365 3rd 353,362 (5th Cir. 2004)
The SEC complaint is a classic example of an ill-conceived, shotgun pleading in search of defendants and cause of action to justify a SEC-Receivership. They already state the leaseholders have lost their money. "The fraudulent Universal Lease scheme eventually collapsed, leaving investors with losses that exceed $300 million."
What losses! RHI and other asstes are there and can be claimed to pay the leaseholders.
We all know at this point that Kelly and his family owned and controlled RHI and the other companies. It appears that the SEC is more concerned about the brokers than real justice!
In any case, we will challenge any SEC-Receiver appointment of their own receiver "the fox garding the chickens" and request that the court appointed receiver be the RMG group made of leaseholders. We are in for a fight and what we want has been done before by another group.
SEC Charges 26 Defendants in $428 Million Securities Fraud That Targeted Senior Citizens and Retirement Savings Commission's Crackdown on Financial Fraud Against Seniors Continues
FOR IMMEDIATE RELEASE
2007-172
Washington, D.C., Sept. 5, 2007 - The Securities and Exchange Commission today filed charges stemming from a $428 million securities fraud that victimized thousands of seniors and other investors throughout the United States. The SEC's action, filed in federal district court in Chicago, Ill., charges 26 defendants and alleges that they participated in a massive fraud that involved the sale of securities in the form of "Universal Leases." The investments were structured as timeshares in several hotels in Cancun, Mexico, coupled with a pre-arranged rental agreement that promised investors a high, fixed rate of return. The fraudulent Universal Lease scheme eventually collapsed, leaving investors with losses that exceed $300 million.
The case is part of the Commission's crackdown on financial fraud against senior citizens, which has already resulted in more than 40 enforcement actions over the past two years.
In the latest action, the SEC alleges that Michael E. Kelly and those working with him duped thousands of U.S. investors into using their retirement savings to buy Universal Leases on the false promise of safe and guaranteed returns. The SEC alleges that from 1999 until 2005, Kelly and others raised at least $428 million through the Universal Lease scheme from investors throughout the United States, with more than $136 million of the funds invested coming from IRA accounts. The SEC further alleges that a nationwide network of unregistered salespeople who sold the Universal Leases collected undisclosed commissions totaling more than $72 million. For most of the scheme, the complaint alleges, Kelly and his organization used new investor funds raised in the scheme to make illusory "rental income" payments to Universal Lease investors. The SEC also alleges that Kelly and others ran the scheme from Cancun through a number of foreign entities in Mexico and Panama.
"This case illustrates the Commission's continuing commitment to hold accountable those who prey upon the retirement funds of older Americans," said Linda Chatman Thomsen, Director of the SEC's Division of Enforcement. "Kelly and his cohorts told investors they were purchasing a safe, high-income investment suitable for a retirement account. In reality, investor funds were at grave risk as investor funds were used in a way that guaranteed the collapse of the scheme."
Merri Jo Gillette, Regional Director of the SEC's Chicago Regional Office, added, "Kelly and those involved in his operation may have hoped to evade U.S. law enforcement by operating the Universal Lease scheme from abroad. The action we filed today shows that the SEC will vigilantly pursue those who target older Americans, no matter what the obstacles. The SEC plans to aggressively seek recovery from the defendants to offset the huge losses they inflicted on investors."
According to the SEC's complaint, Kelly and others told investors that Universal Leases would generate guaranteed income through the leasing of investor timeshares by a large, independent leasing agent. In fact, the complaint alleges, the leasing agent was a small Panamanian travel agency controlled by Kelly, and for most of the scheme its payments to investors came from accounts funded by money raised from new investors. Further, the complaint alleges that Kelly and the other defendants failed to disclose several key facts about the Universal Lease investment, including the risks of the investment and that more than $72 million in investor funds were used to pay commissions as high as 27 percent to the selling brokers.
The SEC's complaint names the following individuals and entities as defendants: Kelly, Michael P. Kelly, Donald L. Kelly, John Corwin, Corporativo Nola, S.A. de C.V. Resort Holding International (RHI) S.A., Panorama Communities, S.A., World Phantasy Tours, Inc. (Viajest Fantasia Por El Mundo, S.A.), also doing business as Majesty Travel, Galaxy Properties Management, S.A., Yucatan Resorts, S.A. de C.V., Resort Holdings International, S.A. de C.V. The complaint also names as defendants a number of the unregistered brokers who sold the Universal Leases to the investing public. They are: Mark Ruttenberg, Ruttenberg and Associates Financial Marketing, Inc., Mark G. Meyer, Mark Meyer and Associates, Inc., Richard E. Riner, Southwest Income Marketing, Inc., George Phelps, also doing business as Safe Estate Plans, John E. Tencza, also doing business under the name of American Investment Management Group, Inc., American Elder Group, L.L.C., Carl Q. Lee, Carl Lee and Associates, Inc., Roy D. Higgs, Warren T. Chambers, William K. Boston, Jr. and Century Estate Planning, Inc. Finally, the complaint names Avanti Motor Corp. and DMK Properties, L.L.C., two entities affiliated with Kelly, as relief defendants, alleging that they received ill-gotten gains from the scheme.
The SEC's complaint charges the defendants with violating the antifraud and registration provisions of the federal securities laws, and seeks permanent injunctions, disgorgement of ill-gotten gains, and civil penalties. The SEC acknowledges the assistance of the German government (Bundesanstalt fr Finanzdienstleistungsaufsicht), the Mexican government (Comisin Nacional Bancaria y de Valores) and a significant number of state securities agencies.
Combating financial fraud against older investors will be a focus of the Commission's second annual Seniors Summit in Washington, D.C., on Sept. 10. The Summit also will include the release of findings from regulatory examinations of 110 firms offering "free lunch" investment seminars aimed at seniors.
The SEC's Seniors Summit will begin at 10 a.m. ET on Sept. 10 and will be webcast live on the SEC Web site at www.sec.gov. The event will further examine how regulators, community organizations, and others can increasingly coordinate efforts to educate older Americans and protect them from abusive sales practices and investment fraud. Registration information and other materials about the Seniors Summit are available at: http://www.sec.gov/spotlight/seniors/seniors_summit.htm.
# # #
For more information, contact:
Merri Jo Gillette
Regional Director
312-353-9338
Timothy L. Warren
Associate Director
312-353-7394
John J. Sikora, Jr.
Assistant Director
312-353-7418
SEC's Chicago Regional Office
Additional materials: Complaint
http://www.sec.gov/news/press/2007/2007-172.htm