You are lying on a beach, perhaps in Spain or Greece, when a sales representative contacts you. He offers you a free scratch card with the option of winning expensive prizes. You accept.
Soon you are sitting in the seller's office – not to claim a prize – but to learn more about the membership of a so-called holiday club that promises discounts on travel and hotels.
"The sellers lure the consumers with prizes, but the real purpose is to get them to sign up for an expensive membership in a holiday club. Often, it appears that consumers do not receive what they were promised and it is almost impossible to terminate the contract," says head of European Consumer Centre in Denmark, Lars Arent.
Inquiries to European Consumer Centre Nordic's centre in Denmark, Sweden, Norway and Finland show that the holiday clubs can be an expensive affair.
Last year, European Consumer Centre's Nordic centres received 566 inquiries concerning holiday clubs. During the first five months of 2014, the centres have received 216 inquiries.
The consumers have typically lost thousands of kroner paid as a deposit to the seller. And they want help to get their money back.
"Our best advice to the consumers is that they keep a cool head and do not sign the contract on the spot. Instead, they should bring it home and read it thoroughly. If they cannot understand the contract, they should not sign it," says Lars Arent.
European Consumer Centre is now launching a film to warn against the traps of the holiday clubs. And European Consumer Centre's website also offers advice on how to avoid ending up in the expensive contracts.
How it works – holiday clubs
- The sellers typically use methods such as free scratch cards to lure the consumers to enter into contracts.
- The consumers are invited to the seller's office, where they are presented with an offer for membership in a holiday club. According to the seller as a member you receive discounts on travel and accommodation.
- It will all typically be promised verbally.
- When the consumers sign the agreement they must simultaneously pay a deposit of between EUR 500 and EUR 1,100.
- The contracts typically bind the consumers for three to six years and they pay a membership fee every year.
- Later it appears that the offer was not as good as promised. But when the consumers want to terminate the contract, it proves to be impossible.
European Consumer Centre's advice on holiday clubs
- Bring the contract home.
- Do not pay right away and do not pay until the right of cancellation has expired.
- Never sign something you do not understand.
- Get a 14-day right of cancellation written into the contract.
- Do not give the seller your credit card information.
See European Consumer Centre's film concerning holiday clubs.