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Encanto El Faro Cancels 100's of reservations keeps deposits

In cooperation with: Visit Mexico
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Encanto El Faro Cancels 100's of reservations keeps deposits

It appears that the El faro resort Hotel has been taking reservations with no intent to honor the bookings. it appears the 50% deposits they require for a booking they will be keeping. They have fire the management however the HOA is telling us who lost our deposits that we are on our own to attempt to recover our $$$. They have said that we can rebook however we will have to pay again.

Below is the email I received regarding this fraud:

We regret to inform you the management company Encanto has been asked to cease and desist at El Faro Condos. We request your immediate action to dispute your credit card charges for your reservation with Encanto at El Faro Condos for your upcoming vacation in Playa del Carmen, Mexico. You will see in the email below from the president of the El Faro HOA Association the depth of Encanto’s fraud. The owners at El Faro will not accept any reservations made through Encanto for El Faro. Playa Premiere is requesting that you dispute the credit card charge made by Encanto. We will be able to re-book you at El Faro. We are working with all condo owners and the HOA group to do everything we can to make this as seamless as possible. The issue is massive and has affected all booking agencies. It will require a lot of cooperation from all parties; we have no affiliation with Encanto as we are just a booking agency similar to Expedia. We will support you with any documentation needed to dispute your credit card charge. We did not process your credit card but sent it directly to El Faro’s property manager Encanto as shown on the credit card form. This email and a copy of the letter from the president of the HOA will support your dispute for a full refund.

We are working closely with owners to block the calendars for your specified condo and dates. Once you have disputed your credit card charge please notify us asap. We will send out new contracts and payment options to ensure you do not lose your condo for your specified dates.

Encanto had over 600 reservations on the books so this is HUGE and has affected many clients, agents and condo owners.

If you would like to contact Encanto we have provided their information:

Mexico 01-800-832-9202

Foreign (+52) 984-873-3130

Encanto Hotels and Resorts

Playa del Carmen, Mexico

CEO Luis Garcia vp@salomonjabez.com

Reservations revenue@encantoresorts.com

Accounting financedirector@encantoresorts.com

I would not expect a response or the truth. If they do respond and confirm your reservation please copy us on the email; so we can confirm with the owner.

Letter from HOA

Dear Owners:

Encanto chose to resign as administrator before we called a vote to dismiss them. As presented at the annual meeting Encanto owes the HOA several hundreds of thousands of dollars. Encanto's own accountant signed off on the accounting of this misappropriation of funds.

Encanto misappropriated large amounts of money from the HOA while not paying the salaries of the staff employed at El Faro, and while not using the money it had available for obvious maintenance needs.

Starting in 2010, Encanto charged the HOA but did not purchase hurricane insurance. We discovered this in May 2013 and one of the Directors paid the premium directly to the insurer who had cancelled the insurance. This is another quarter of a million dollars.

Encanto has fraudulently sold time share vacation club packages although it owns no real estate or condominiums at El Faro to accommodate those rentals.

We presume it was planned to rent your units at reduced rates while pocketing the advance payment of the time share purchase.

Encanto has sold advance reservations to several travel agencies and corporations which will be seeking to use accommodation at El Faro to satisfy those payments which have not been passed on to the owners.

Encanto has sold many deeply discounted rentals in the past months for an advance payment who will be seeking to use El Faro although no money has been paid to the owners.

Encanto has practiced a program for the past three years of skimming rentals in several ways, including walk-ins which are not recorded, recording a lesser rental amount than actually charged, fabricating costs charged to owner accounts, nonpayment of amounts charged to owner accounts, and ultimately stonewalling any requests for remittance of money due to owners.

The amount owed to owners is in excess of $1,500,000USD. The amount skimmed represents between 15 and 20% of the gross revenue over the last three years of each and every condo rented by Encanto.

Encanto is currently trying to sell as a package the rental agency contracts it has with El Faro homeowners, we are told.

On the other hand Encanto recently sent a memo advising owners that they should stay with Encanto and he would be providing a special check in area.

We now understand Luis is planning to set up his own check in desk within Wickys, which is not an allowable use of the restaurant space. We cannot tolerate two check in counters.

I, and several owners have fired Encanto from renting our units. Yet Encanto has ignored these instructions and continues to rent and reserve those units as if no instructions were given. Encanto acts as if they own El Faro and we, the owners, are an inconvenience.

Luis Garcia, the owner of Encanto, is a smooth talking, somewhat clever thief. He has stolen from the HOA , he has stolen from homeowners who have used Encanto as a rental agent, he has stolen from employees and suppliers.

He has stolen from his business partners, one or more of which have provided the Board with details of his activities described above.

Firstly, we encourage any owners who continue to use Encanto as rental agent to immediately terminate them. Encanto will probably indicate it has an enforceable contract with those that signed one. Of course Encanto is in breach of any contract due to nonpayment and misappropriation of funds.

Secondly we will reject any reservations made by Encanto (as no money will be paid to owners for these prepaid reservations or any other money

collected) and advise travel agencies immediately that we will not accept Encanto reservations and that they must pursue Encanto for recovery.

Thirdly we will attempt to contact purchasers of prepaid or deeply discounted rental packages that we will not be honoring these rentals.

Fourthly we will post a notice at the front desk that Encanto generated reservations will not be honored at El Faro due to nonpayment. We will provide Encanto contact information, their phone numbers, and the address of their place of business within that notice.

Any homeowners who foolishly choose to continue to have Encanto as a rental agent will need to directly provide to the front desk the names of guests and arrival times. We will issue key cards as guests of the homeowner and they will be treated as such.

The HOA and its front desk ceases to recognize Encanto as rental agent doing business with El Faro. We will not work with an entity that has stolen large sums of money from the HOA and its homeowners, nor will we try to sort out the reservations mess we are left with.

The HOA is discussing legal action to recover the funds stolen from it as a fraud. We may seek the involvement of the appropriate authorities in a criminal investigation. We recommend that any homeowners who are owed money by Encanto join together to follow a similar path.

Respectfully

for the Lighthouse Properties/El Faro Condos HOA board

Vancouver
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41. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

I have been in the same situation as you trevor....twice actually. Firing the unscrupulous property managers that the shady developer put in to cover their butts brings a lot of work to transition, but your group will be much better off. Heres to hoping you get a good manager....but weve found that replacing is always a significant upgrade over the stooges put in place by the developer.

Agree with steve and trevor.... Folks should work encanto and their cc company on this one.

Paris, France
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42. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

I am not an expert in Mexican law, so I can not be sure who is responsible here in civil terms. I do find it very odd that the HOA can simply cancel all reservations made by the agent that was, at the time, their official representative, and take no responsibility at all.

I'd advise those who are affected by this situation to contact the federal agency for consumers in Mexico. They will help you finding out about your rights in this situation. Here is the information in English, an e-mail for foreigners is provided: www.profeco.gob.mx/Folletos/Queja_ing.pdf

Good luck to everyone!

calgary
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43. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

Steve

What you are missing is the law of agency. The principal (meaning the person employing the agent) is bound contractually by the acts of his or her agent when dealing with third parties unless the third party has been given notice of the termination of the agency before the contract is made. If the agent is breaching the terms of his agreement with the principal that is not the third party's problem. The contracts in this case are between the renters and the El Faro owners not between the renters and Encanto.

I actually wrote to the e-mail address supplied by Trevor C and the response I got was completely non-committal and unsatisfactory to say the least.

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44. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

Playa Maya.

If I buy a clock at Target and the manager or employee steals the money Target does not come back to me and say return the clock or pay for the clock again, that manager or employee was the agent for the store. If I ordered an item from Amazon and the funds were stolen from say an employee or contracted agent Amazon does not come back to me and say my order is canceled and you will not get your money back and pay again if you want your item.

Had this been the reseller that did this I could see were the recourse would be with them but this was the management for the property.

To some degree Encanto was under the employ of El Faro.

For the record I have made the attempts to contact Encanto with no response.

Cowtown is correct El faro should honor reservations and seek restitution from Encanto.

I understand there might be a select few reservations that were just recent that were accepted by Encanto with malicious intent but my guess is most were not and Encanto intended to fulfill at least with the renters.

I had an interesting phone call this morning from the original agency (reseller) I booked through. they called to say that my condo was available at the original rate that I paid (i was still to lose my deposit but if I wanted it I would have to pay the full amount all over again) This was odd considering that I already re-booked (and Paid in full) last week directly with the owner who when asked if they would honor my original rate they said NO and I would have to pay more (about 15%). which I did, as time to replace it is was not on our side. So in my case not only did I lose my deposit but I had to pay extra to get the same room for the same dates, so not only did El faro not lose any $$$ on me they made even more.

Trevor did kindly suggest I email him directly which I did so I will wait and see what the response is.

Vancouver
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45. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

cedar crest your logic is faulty sorry...if you give the manager at target 20$ for the clock, and the manager puts that 20$ in their pocket and not the register, target will still go after you for the $20. target has not received payment so why should you, because you are out of pocket, get a freebee from them?

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46. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

Thanks for the replies. And sorry to hear that folks don't seem to be hearing back from Encanto!

"If I buy a clock at Target and the manager or employee steals the money Target does not come back to me and say return the clock or pay for the clock again, that manager or employee was the agent for the store. If I ordered an item from Amazon and the funds were stolen from say an employee or contracted agent Amazon does not come back to me and say my order is canceled and you will not get your money back and pay again if you want your item.

"Had this been the reseller that did this I could see were the recourse would be with them but this was the management for the property.

"To some degree Encanto was under the employ of El Faro..."

Well apparently they had a business relationship for some of the time. Apparently also other booking entities did, as well. I guess the extent of that relationship is partly what's at issue. However I don't see that it is like what you describe in your 2 examples here. Even if Encanto was also hired to do certain activities on site, that seems apart from the booking aspect of things, especially when considering that other entities were apparently also doing the booking work. It seems to depend on how you see that relationship, and it seems that you view it as quite a close or even an exclusive one, or view them as essentially one and the same entity (whereas no one would assume Target and, say, Sony were one and the same entity or that anything like that was implied by Target selling a Sony product).

And I see what you're saying, Cowtown, but again I wonder about the closeness of the relationship. We had to terminate a stay some years ago because a travel agent we had been doing business with for some time began to fail to pay. After some months of going round and round with them, we gave them a clear, set deadline to pay prior to any arrival or to risk losing that stay. They didn't pay and we cancelled the stay. We tried to inform the guests and to explain to them the situation, given what very limited contact information we could find for them. We never heard back and presume that they booked at another property through the same agent, using whatever they had already paid that agent.

And again that is what I was asking about here: why not pursue that more obvious route first. And if the response is not satisfactory or there's just no response at all, why not pursue a refund via your credit card issuer? I guess YMMV on that sort of thing, but personally it's hard for me to imagine that the issuer is not going to side with their cardholder when the merchant is non-responsive. Merchants are generally required to keep record of support for transactions for a couple of years, at least, and to provide that support upon request of the banks or risk losing the funds in question. Seems like even if it's not ideal — even if it doesn't automatically guarantee anyone the same lodging they thought they already had at El Faro — well it would avoid the monetary loss and leave people open to rebooking with El Faro in a more reliable way or to booking somewhere else, if preferred.

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47. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

From the original posted e-mail.

"We regret to inform you the management company Encanto has been asked to cease and desist at El Faro Condos. We request your immediate action to dispute your credit card charges for your reservation "

I don't understand how the (owners) action at the far end of the transaction (with Encanto) should impact the consumer (renter). There is a criminal element involved , who ultimately should be held responsible for the money and restitution should be made.

Bottom line is there needs to be more protection for the consumer , in this case, I see no reason why the consumer should have to pay twice or hope for restitution.

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48. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

CDLVancouver

"cedar crest your logic is faulty sorry...if you give the manager at target 20$ for the clock, and the manager puts that 20$ in their pocket and not the register, target will still go after you for the $20. target has not received payment so why should you, because you are out of pocket, get a freebee from them?"

That is absurd logic when I handed my $$ to the company representative that is payment to the company, it is not my responsibility or even under my control where the $$$ ends up once I have officially paid with and received a receipt acknowledging the completion of the transaction

Vancouver
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49. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

Well good luck going after the unit owner for money they never received.

Colo Spgs
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50. Re: Encanto El Faro Cancels 100's of reservations keeps deposits

Good luck with the negative PR and possible drop in bookings. How many people who lose money will go back?