Manhattan Club Lawsuit

The credit agencies go after people who owe money--for a percentage--a very large percentage.

Yes, I realize that. .just confused about your wording about the credit agency "going after TMC". They would be going after the debtor...the party that owes the money.

Waynec92 - Wayne C Robinson - Can you just let me hire you to get out of the timeshare? Are you a Manhattan Club Member/Owner? I just looked at your Facebook page and it appears you guarantee to that we can get out in one day by reading your book. I'm too busy to read a book so I'll wire you $1000 by Tuesday of this week if you can GUARANTEE to get me out of my Manhattan Club lunacy by tomorrow. That's a lot more than the $20 for the book. And I'm not being a smartass at all. I've been reading these posts since page 40 or 50 and this is my first message and I'm tired of it all so if you are saying it can happen than let's make it happen. I just signed up to be on your email list so you'll find me. My name is Mark Stevens.

While I certainly agree with you that this was a bad investment and I agree with much of what you have said, I want to point out that when some owners do not pay their maintenance fees, it does have an effect on those that do. How can staff salaries be paid, taxes be paid, utilities be paid, repairs/maintenance be paid, insurance be paid when there is a shortfall in revenue ? There were not and are not huge reserves sitting there to be used to fund the deficits incurred when more and more owners cease to pay their maintenance fees for whatever reason. I don't think anyone wants the Manhattan Club to "go dark" - to be put into bankruptcy. It stands to reason that when there is a large deficit, then the maintenance fees for ALL have to be raised. Perhaps that is what the $6,000,000 settlement fund will be used for if it is ever paid but I think that those who have not paid their maintenance fees will probably not get the same benefit. I totally agree with William, those who have not paid their fees will still be responsible for them. I seriously doubt that those debts will be forgiven or that those owners will be allowed to walk away from their debts without some repercussion. I think that is the point that William and others have been trying to point out.

Tulip blossom, did you read one of my previous posts? What do you say to the fact that TMC double-dipped for years, charging us maintenance fees, not giving us our time and renting our rooms/time out to the public? By the way when they rent those rooms out to the public they don't put that money into the association to pay the bills....right in their pocket! And my next question to you is don't you think that in addition to the double dipping of thousands of us...for so long, if Eichner hadn't skimmed 6.5 MILLION a year to some phony shell company that there would have been plenty of money to pay the bills? Just wondering your thoughts on that.

hey debra, i will not "take sides" in this forum (as i might have earlier in my more pugnacious days of this forum) but i must agree at least 90% with your response to tulipblossom about some of us not paying maintenance fees and thereby raising them for others who do pay these exorbitant fees. your reasoning makes sense. it's not in eichner's dna to lose money. your comments on double dipping (and screwing owners in the short run) are sooooo sensible. my comments here earlier this week echo much of what you have written today. eichner is a criminal vis a vis sales lies and fraud AND MAIL FRAUD, A FEDERAL CRIME. we're all bitc***' and moanin' and misplacing blame. the truth is, schneiderman did a pis*-poor job of litigation: i.e., eichner and gang are still not caged as they should be along with reducing the equity in their empires to pay us for our financial and psychological pain and suffering. A $6.5 MILLION PENALTY AGAINST EICHNER DIVIDED AMONG THOUSANDS OF TMC OWNERS IS PROBABLY ABOUT 10-12 CENTS. LET'S DONATE THAT TO THE BELL AND FRONT DESK CREWS AND TO THE HOUSEKEEPING PERSONNEL (WHICH WOULDN'T EVEN BUY THEM A STARBUCKS........ANYTHING!)

as an aside, i had a conversation with an officer at bluegreen. i was assured that current TMC owners will be "satisfied" with bluegreen's future plans as they eventually take over TMC. i'm not exactly sure of this, but i believe the officer said they would be taking over the board in the very near future..........in august?......not sure. call them to verify my comments here.

anyway, deb and tulip, we're all participating in this forum, with different complaints and points of view. WHAT WE ALL HAVE IN COMMON IS OUR CONTEMPT FOR THE FRAUDULENT ENEMY AND HIS BAND OF RELENTLESS WARRIORS. isn't that the only glue that's holding us together? KEEP IN MIND THAT THIS FORUM IS AT LEAST 4-YEARS-OLD.................AND VOLUMES OF PAGES................ABOUT 205-6 LONG. let's keep our comments working toward a common and blameless focus against each other. FOCUS OUR BLAME WHERE IT BELONGS...............ON EICHNER, ET AL, AND GO FORWARD FROM THERE.

Thoughts regarding some of the issues recently discussed here: (in no certain order)

1.) “A $6.5 MILLION PENALTY AGAINST EICHNER DIVIDED AMONG THOUSANDS OF TMC OWNERS IS PROBABLY ABOUT 10-12 CENTS.”….The $6.5M settlement is to be used to compensate the administrator of the NYAG settlement and those who could not book a stay during 2011-2014 that remain current with maintenance fees. The total number of individuals affected who qualify is probably several hundred….not thousands. 2.) “The credit agencies go after people who owe money--for a percentage--a very large percentage.”….the amounts not recovered are written off to the benefit of the corporation. Meanwhile the individual is hit with a collection action on his/her credit report for seven years. 3.) “ I want to point out that when some owners do not pay their maintenance fees, it does have an effect on those that do. How can staff salaries be paid, taxes be paid, utilities be paid, repairs/maintenance be paid, insurance be paid when there is a shortfall in revenue ?” ….The losses are covered via tax laws of capital gains and losses for corporations. Furthermore if the corporation uses “GAAP” reporting …..it is most likely there is a financial gain for the Eichners. 4.) “the fees were rising HIGH long before myself and others decided to stop paying. So you can throw that theory out the window, all the while collecting our fees, refusing us time ..and renting our time to the public. How do you explain that... if you think that the reason the fees went up because of owners who are not paying??”….Maintenance fees will rise incrementally when there are payment defaults by owners. However the significant increases that have occurred are primarily based on the building owners’ desire to skirt NY rent control guidelines and profit for the same which is then charged to TMCNY and passed on to timeshare owners.

The association follows the delinquent owner if fees not paid. (At least in California)

I'm with most of you posting. I want to get out of my Manhattan Club ownership. To this day, I still haven't found what I'd call a legitimate and fair way. I'm also in another large timeshare co in Hawaii who offer a take back program. Why is it that timeshare companies get away without offering a way out for their owners? Would be a win/win if they did.

Don't be silly! Why would they want a win/win? LOL

First, Sir, as much as it seems generous, I am not here to take your $1,000 when you can simply do it yourself.

I have a few questions for you...

1. Is it paid in full? 2. Have you not been able to use it? I.e. no availability?

Debra, I'm not sure when you purchased your timeshares but I was one of the first, I purchased 2 weeks, then upgraded.to the penthouse units. I also discussed the situation with our fees, the issues with not being able to use out weeks, the non existence of the promised rental program to benefit the owners, etc. with an asst. attorney general - we were on the phone for 1 hour, 45 minutes back when Eichner was being investigated. Since years earlier, I had used my legal background to go into real estate, development, I raised a number of issues with her. I think there is some confusion about the Manhattan Club and Eichner's company. So, I wanted to point out the following which was my understanding but I could be wrong since I was never licensed to practice law nor develop real estate in New York state.. Eicher was the developer and he had a development company and also a separate management company. Once the time share association was formed, that became an completely different entity. As you may recall, Eicher controlled the sales and the buybacks and that was through his development company. He then formed a management company and through that he was able to exert some control over the actions of the staff employed by the Manhattan Club and that included being able to rent out weeks that legally he was not entitled to do. The rental money, as you pointed out, went into his pocket, not to the Manhattan Club - same with the $6,000,000 management fee he charged the Association each year- it went to his management company and not to the Manhattan Club. Also, as one of his"sales" tactics, those selling the timeshares were instructed by Eicher to assure the purchasers that their fees would not go up much at all and that their units would only increase in value. Eichner was supposedly supplementing those initial assessments and the budget shortfall. That is one reason the assessments remained low for many years. After the Manhattan Club became virtually sold out, we began to see our assessments go up. Eichner no longer supplemented the operational expenses of the Manhattan Club. The Manhattan Club had a budget which Eicher's packed board agreed to. So - we had a budget with all the related expenses needed; it was not a profit making entity. And as more owners began to have issues and to stop paying their assessment, the Manhattan Club ( not Eicher's development company and not Eichner's management company) began to have a deficit. So - how do you fund that deficit - certainly the Manhattan Club was not in a position to borrow money so what was it's option? The option is to continue to raise the assessments. And although I totally agree that Eicher was a crook, that we have all lost money, that we have been scammed not only by Eicher but also by the Attorney General, it is the Manhattan Club that is negatively impacted when people cease to pay their assessments. Their beef, our beef, is with Eicher and not the Manhattan Club. The Manhattan Club is owned by the time share owners. So - that is the understanding of the situation and an explanation of what has transpired. If anyone has a different interpretation or understanding of the prior events, then I welcome a chance to hear them. But again, it is the Manhattan Club (the timeshare owners) that suffers when assessments aren't paid for whatever reason.

This is a great summary of what transpired, although very sympathetic for Eichner, where did the money go for all the rooms that were rented out to the public? Knowing how many people did not get to use their unit because it was being rented out to the general public had to have amounted to a significant amount that should have gone to TMC. The rooms were rented out at comparable prices to a NY hotel room so I can’t imagine that TMC would rent those rooms out and take a loss because the rate didn’t cover the costs associated with renting it out. And let’s not forget the elaborate renovations to the lounge/bar area. Why would those be done if the TMC was carrying a deficit. It doesn’t make sense.

Additionally, if the TMC is owned by the timeshare owners why isn’t the board made up of the time share owners? I wouldn’t allow anyone other than myself to manage my personal home and finances. If I “own” the TMC why don’t I have a say in how it’s finances are run? I certainly wouldn’t renovate my “lounge” if I didn’t have the money to do so. This still does not make sense as you’ve explained it.

Great job, Tulip Blossom! It's too bad you can't insert a diagram here to show the lines connecting Eichner (as developer), Eichner (as property manager) and Eichner (as controller of the owner's association), all represented by separately incorporated entities. The developer appoints the majority of the members of the board which in turn approves the management contract to another company which is also owned by the developer. I don't think you're being sympathetic to Eichner. You've just accurately described the business structure of the Manhattan Club. Except for the fraudulent sales piece, it's all perfectly legal. It's just that in most cases, the developer exits the deal after a certain percent of the inventory has been sold, but in this case that never happened. The MC was just generating too much money for Eichner to walk away.

Now it has to be unwound. But it doesn't help that most owners use all the entities interchangeably. Every few months we have a new class of "freshman" posters who haven't done their homework and ask the same questions over and over again; making the same suggestions we've been hearing for years; and a few long time contributors who can't understand why the AG didn't take on their personal lawsuits or why Eichner hasn't been convicted of a capital crime. As I said once before, Eichner will make money as long as he is involved, the lawyers will make money as long as they can generate billable hours and the owners will be an afterthought. And that $6.5 Million? I used to be more hopeful, but now I feel more like lol!

My further understanding regarding Eichner ,and I am certainly not in agreement with his actions nor condone what he did, was that when the original documents were drawn up that covered the management of the Manhattan Club, Eichner had a provision that he was able to select ("sponsor" was the term) a number of Board members - that way he was able to maintain control of the Board and subsequently have an indirect voice in how the building was being managed and the budgets were being set. The Manhattan Club staff were aware of his position. It was quite easy for him to notify the staff (front desk) that for example, no more 4th of July weeks were available for use by the owners - the staff would not know any different because if you will recall, he was still selling timeshares so he owned a number of them. He could merely instruct the staff that he was booking time for weeks that he owned. Any money he received from the sale or rental of those time shares and buy backs went into his pocket - it never went into the coffers of the Manhattan Club. So any weeks that he instructed staff to marked off as not available were weeks his company/cohorts could rent and pocket the money. He did not have to explain anything to the staff working at the front office. Remember, he had set up a management company to oversee the Manhattan Club to the tune of $6,000,000 annually and he had ZERO employees. This was all part of the scam he was pulling. Also, remember - the employees were not informed as to the finances or the budget or anything else - in the scheme of things, they were only low level employees who indirectly took orders from Eichner. He had the authority to indirectly or directly hire and fire them. If you will read previous posts, you will see that we have questioned control of the Board and in the past, we've been thwarted in our efforts to put our own representatives on the Board. Just recently through a posting here, we learned that one of our posters was able to obtain approval to be nominated to run for the Board. Possibly you did not read nor understand the By Laws and other rules regarding the Manhattan Club because when you signed your contract to purchase, you agreed to the arrangement that Eichner had. As for renovations to the lounge, there would be reserves set aside and remember, the budget is set by the Board and that Board is comprised mainly of Eichner appointees. The Board and Eichner decided how the Manhattan Club assessment revenue was to be spent. Like I said, I am an owner too and I would gladly sell my 2 penthouse weeks if I could recoup some of the monies I have lost. As for your comment about not having a say in how the finances are run, you do have a voice - Eichner would say that you have an opportunity to vote for members of the the Board because they are your voice - like it or not. The unfortunate thing is that your and our "Voice" is made up of Eichner's cohorts - they do his bidding as they comprised the majority of the Board. In the past, we never had an opportunity to even nominate owners sympathetic to our plight.

Great info, Tulipblossom and Nathan! Really sheds some light on what happened...and how and why it could happen. Thanks !

I am sorry, but I do not accept funds for helping people out of their timeshares.

Cheers.

Interesting information from tulip. I was wondering if the financial statements we owners receive reflect the past due balances that have not been received? Were in these statements are the reserves that you mentioned? Also is rental income now coming into the timeshare association?

I haven't reviewed the most recent financial statements. In the past, a number of categories were supposedly over estimated thus providing a "cushion" so I believe at times there were funds left over. At one point, the Manhattan Club did some major upgrades as to furnishings, etc. but I do not recall under what category that expense was projected. As for the rental income, to my knowledge the Manhattan Club does not receive any rental income and never has. I know when I first purchased, I bought two weeks as I was told that a rental department to accommodate the owners would be set up. At that time the assessments were low, and that was pointed out to me by the sales team along with their statements that if an owner was unable to use his week, then he could place it with the rental department and that owner would receive the rental proceeds.The phrase "being unable to use his week" was described as an owner who because of his own circumstances was unable to use his designated or assigned week. That seemed logical as the sales team claimed you could actually make money because the rental rates for a place like the Manhattan Club would be high; there would be a substantial demand by non owners (AKA "renters") to stay in such a luxurious and convenient location,and again, the assessments were low. Part of the problem we later discovered was that Eichner sold more weeks than were physically available. So , for many of the units, he was selling more than 52 weeks a year. In my situation, I bought my two weeks at the same time and my documents reveal that on the same date both purchase agreements were executed. Over the years though, he or someone I assume at his behest, changed the dates on one of my weeks. That meant I could never have use of both my weeks at the same time even though I purposely bought them at the same time. There were just so many roadblocks thrown at us to prevent our use of our timeshares. More and more fraud was later discovered and that is why we were so disheartened that no criminal charges were levied against Eichner nor a much, much larger fine.