Peters Pond RV Resort to Pay Restitution for Allegedly Strong Arming Residents into Buying Memberships
Management Company also Required to Pay $200,000 in Civil Penalties and Costs
BOSTON – In a settlement resolving allegations that it strong-armed residents into paying $16,000 for memberships of questionable value, Peters Pond RV Resort in Sandwich will refund residents, pay an additional $200,000 in civil penalties and costs, and refrain from future unfair and deceptive practices, Attorney General Martha Coakley announced today.
“This company took advantage of elderly customers and retirees who invested a significant amount of money in their homes,” AG Coakley said. “It is difficult to believe that any business would try to strong arm people who worked and saved their entire lives so they could enjoy their golden years. We are thankful that these practices will end and that consumers will receive restitution.”
The AG’s Office filed the original complaint in Suffolk Superior Court in August 2011 alleging violations of the Massachusetts’ Consumer Protection Act. In September 2011, the court ordered a preliminary injunction prohibiting any future intimidating sales tactics.
Residents at Peters Pond originally purchased “park model homes” that appeared to be manufactured homes, often referred to as mobile homes, that are costly to move. Although the homes are owned by residents, the lots are leased from Peters Pond. Residents believed they could renew their lease indefinitely as long as they paid rent and abided by community rules.
According to the complaint, the owners and operators of Peters Pond – Peters Pond RV Resort, Inc., Morgan RV Resorts, LLC, Ideal Private Resorts, LLC and Robert Moser – allegedly threatened consumers that if they did not purchase a new $16,000 membership, in addition to paying the annual $6,000 homeowners fee, they would lose their home-site and be forced to move their mobile homes at their expense and without compensation. The membership fees did not include any apparent benefits.
Nearly 100 homeowners paid to join the club out of fear that they would lose their home, in which many had invested their life’s savings. Then, when residents tried to sell their homes, the defendants allegedly interfered with the homeowners' rights by preventing homeowners from using brokers to assist in the sale and charging a $2,000 “transfer fee.”
The consent judgment filed yesterday provides refunds to consumers who paid for the membership program. Residents who feel they are owed money will file claims with the company. Additionally, the defendants will pay $200,000 to the Commonwealth in penalties and costs.
The consent judgment also prohibits the defendants from continuing certain alleged unlawful sales practices, provides lease rate increase restrictions for current Peters Pond consumers and requires full itemized disclosure of all fees charged for goods or services provided, including any transfer fees. The defendants must also allow consumers to retain an appropriate broker to sell their homes.
This matter was handled by Assistant Attorneys General Jonathan Engel and Mychii Snape of Attorney General Coakley's Consumer Protection Division, with assistance from legal analyst Andrew Shealy.