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RCI pure points gone into administration?

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Offline warrior

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RCI pure points gone into administration?
« on: November 07, 2011, 19:33:10 »
We have been told today that RCI pure points have gone into administration, there are two option 1. pay them more money. 2. lose your points. does anybody know any more about this?


Offline warrior

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Re: RCI pure points gone into administration?
« Reply #1 on: November 07, 2011, 22:41:51 »
Hi Boss Man, In answer to your message we called 08456086130 and asked to clarify the letter sent by RCI Points Ltd. It Started like so:- "In our letter dated 27th May we informed you that the Directors, after reviewing the finances of the scheme have concluded that the scheme needs to change to safeguard the interest of the remaining members. we also advised that we were working with the scheme's trustee, resorts and RCI to determine the options available to members. The primerary aim of these discussions has been to identify a sustainable option that will enable you to continue to enjoy the same or similar benifits for the long term."

The pure point scheme was closed to new members in 2004!!!, people have been leaving; therfore those that are left have to pay more to keep the scheme going. This can't continue so if we give them more money we can have SPICE points instead or nothing. the letter was signed by Paul Carter a director of RCI Points Limited.

What do you think Boss Man
« Last Edit: November 08, 2011, 15:05:04 by warrior »

Offline Boss Man

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Re: RCI pure points gone into administration?
« Reply #2 on: November 08, 2011, 19:20:00 »
For the benefit of other members, here is the full letter -

Before I summarise what was discussed at a recent RCI Points Ltd AGM, I must emphasise that RCI Points Ltd is a club that is only a small part of the RCI Points exchange system. The majority of members who use RCI Points exchange system are either part of the Next Generation Points scheme or other schemes/club and will not be affected in any way by what happens to RCI Points Ltd. This information is directed at RCI Points Ltd Club members. If you are not sure which scheme you belong to check your paperwork, your initial contract when you joined the points’ scheme either through ceding weeks and/or buying points.

First a potted history. When RCI decided to start a points’ scheme, they decided to do this by acquiring an existing points club, CRI Points Club. This was a limited company run by a board of directors. Members joined by signing Acquisition Agreements which made them members of the club entitled to attend AGMs and vote for two Member Directors on the board. This structure has still continued but the name of the club was changed to RCI Points Ltd. New members joined by ceding weeks into the system in exchange for an annual points’ allocation and/or bought pure points.

Soon after starting the points system, RCI Europe Ltd realised that there were problems in using this club as the basis for their growing points scheme (my opinion) and so started to introduce other points scheme that ran alongside the original club with same rules of exchange, membership fees, etc. New points members signed participation agreements and membership to RCI Points Ltd was closed. Next Generation Points Scheme (sometimes referred to as NX points) was started around 2005. The main difference for those who bought into this scheme was the way the management fee was calculated. It linked only to the resort at which the points were bought. This has been the main scheme that has continued to grow as people have joined the points system. I must emphasise here that RCI Points Exchange Scheme continues to grow, but not via RCI Points Ltd.

Returning back to RCI Points Ltd, membership of this scheme was closed around 2001. Since then membership has declined to the present day position of around 10,000 – less than half the original membership. Most of the queries we get via MORPS is how do we get out of the points system/timeshare in general. For a variety of reasons people have decided to give up their timeshare products. The basis of the discussion at the RCI Points Ltd AGM was whether the club is still a viable proposition with a declining membership and increasing costs of management fees. RCI Europe Ltd, the parent company, will be looking into this over the next few months and coming back to the membership with various options. These options include:
- Transferring members of pure points into the Next Generation scheme (at no cost) which, for some, would result in reduced annual management fees on their pure points, and with no reduction in members’ benefits or rights. Remember this does not affect your points from ceded weeks. These weeks are all contained in the points’ exchange system that all schemes use.

- Looking at other points’ scheme that members could transfer into, again ensuring that members’ benefits and rights are maintained, and with possible future reductions in management fees.

The biggest headache for RCI Points Ltd, and biggest gripe of members, are the ever-increasing annual management fees. For those owning thousands of pure points, the increases have been most notable. It is important for the points club members to understand how the management fees are calculated. When RCI Europe took over CRI Points Club, they ‘inherited’ existing affiliate resorts with contractual agreements – primarily Crown Resorts and Sunset Beach Club. Other affiliate resorts were introduced into the scheme. In exchange for depositing weeks into the points exchange system, they were given the equivalent in pure points which they then could sell to new members. Towards the end of each year the affiliate resorts will invoice RCI Europe for the annual maintenance fees for each of those weeks that are in the points exchange system. For example:
Resort A has 2,000 weeks in the points system. The maintenance fee for each week is £400. RCI Europe is sent a bill for 2,000 x £400, ie £800,000. This then has to be divided up between the points owners who will have to contribute towards this bill according to the number of pure points they own ie via our managementfees.

RCI Europe, on behalf of RCI Points Ltd, has to deal with these invoices, and then calculate how much our management fees are going to be for the forthcoming year. Some affiliates have thousands of weeks in the system whilst others might have only a few hundred.

It would seem that, in the early days, RCI Europe just accepted these invoices and paid them out on behalf of RCI Points Ltd, then collecting the money in from members via management fees. It often meant big increases in management fees each year – we all remember the fees going up at much higher rates than inflation in general. When I was elected onto the Board, I highlighted members’ concerns and notice eventually started to be taken of these invoices that were arriving from the affiliate resorts. Some were not only asking for the annual maintenance fees but also for additional sums in the form of a levy and these had been paid without question. Others were increasing their annual maintenance charges at rates much higher than the rate of inflation. For the affiliate resorts it was an excellent situation as they were guaranteed the money via their contractual agreements and for those with large numbers of weeks in the system it represented a large proportion of their income. In the early years, RCI Europe were actually subsidising the points club and making up the difference between what was being paid out to the resorts and what was being collected in via management fees.

In the last few years, questions are now asked if affiliate resorts send in higher than average invoices, or additional levies charged, discounts are negotiated for early settlement – all to try to reduce the impact on annual management fees.

However, other factors have complicated the situation:
1 A large proportion of weeks are in the eurozone and the fall of the value of the pound against the euro has had a great impact as these resorts bill RCI Europe in euros.
2 Members wishing to leave the system were allowed to surrender their pure points. The weeks underpinning these pure points were then surplus to the scheme. However there were contractual problems in returning these weeks back to the affiliate resort. Some resorts were willing to take them back whilst others weren’t. It resulted in a surplus of weeks (inventory) within the scheme which were having to be paid for via management fees. It has taken time to obtain the co-operation of some resorts to accept this surplus inventory back and the problem has not totally gone away. The points club is still at risk from any affiliate resorts demanding future higher than average increases in fees/additional levies.

It is because of the complex and problematic system of determining management fees that the RCI Points Ltd club has now reached a point at which decisions have to be made about the financial viability of the scheme. The management fees for 2011 have yet to be determined – this will be discussed by the board in the next week or so when the majority of invoices have been received from the affiliate resorts.

The RCI Points Club Ltd board will be working with both the affiliate resorts, the trustees of the scheme, members and RCI Europe in order to find the best possible solution(s). As was stated at the meeting, the interest of the members will be of paramount importance.


Seems like this could be for real. More information can be found at -

http://www.morps.org/phpBB3/viewtopic.php?f=7&t=991

But this is the first we have heard of it here.

Offline Suebe

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Re: RCI pure points gone into administration?
« Reply #3 on: November 14, 2011, 18:35:28 »
Firstly, the 'letter' explaining the history of RCI Points and what was discussed at the last AGM, is not from RCI.  It is something that I put together and have sent out to some members to help explain what is happening.

RCI Points exchange system still exists and will continue to exist.  RCI Points Ltd is a small part of the overall points scheme.  RCI has spent  many months, since the last AGM in 2010, negotiating with the various affilaited resorts in order to come to some kind of agreement whereby 'pure points' owners can be moved over to different schemes within the RCI points system.  A good many members are transferring over to the Next (or New) Generation points scheme.  Some resorts have not agreed to go down that route and so some groups of owners are being offered different deals.

The SPICE deal is quite different to other offers that have been made.  It involves joining this new points club and, in order to be able to use the club properly, it is necessary for new members to have at least 60,000 points.  These are being offered to pure points owners for free but there is a management charge on them - around £450 per year I have been told.  As a member of SPICE, you will be able to use apartments at their own affiliated resorts, as well as use the RCI Points scheme.

There is another option which is to surrender your pure points back to RCI.  This may be appropriate for people with very few pure points, but for those with large amounts it may not be the best option.

If you are not at all happy with this offer, then go back to RCI and tell them this.  they may be able to offer you another option that may be more suitable.

Let me assure you that RCI Points has not gone into administration.  An AGM is being held in December 2011.  The limited company may well be wound up in the end and cease to exists, but only after all points owners have been transferred to other schemes or leave the system.

Sue Beetlestone
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Sue B

Offline princessg

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Re: RCI pure points gone into administration?
« Reply #4 on: November 19, 2011, 13:31:48 »
Having read the posts about RCI Pure Points I could do with a bit of help.  I got the letter dated 9 Sept regarding Pure Points.  I have 15,000 through a resort called Shanida Ltd I can't for the life of me remember how I got these.

Anyway there didn't seem to be any way of backing out from them so I signed the transfer agreement which transfers them to Combined Resorts Holiday Points Club Ltd (Crown Resorts).   The management fee for these points seems pretty steep at £211.50 for 2011 and the same amount for 2012.

I have a lot of points anyway in the RCI Points system as a result of ceding weeks to RCI points.

Do I have any options regarding terminating the 15,000 points?  Any advice gratefully received
 

Offline Suebe

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Re: RCI pure points gone into administration?
« Reply #5 on: November 19, 2011, 17:46:18 »
You have the right to surrender your points back to RCI - you won't get any money for them but will not have to pay the annual management fees.  It should have said somewhere in the documents you received that you could do this.  If you have already signed to transfer them to the other scheme and sent forms back, you will need to contact RCI asap to see if your decision can be changed.

Sue
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Offline princessg

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Re: RCI pure points gone into administration?
« Reply #6 on: November 20, 2011, 12:07:55 »
Thanks Suebe for your prompt reply.  There was nothing in the letter about being able to terminate the agreement.  In fact is was very cleverly worded to imply that one couldn't terminate and if the transfer wasn't signed by us then there could be financial implications.  Not very open or honest!
 

Offline Suebe

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Re: RCI pure points gone into administration?
« Reply #7 on: November 23, 2011, 09:28:42 »
Having read the posts about RCI Pure Points I could do with a bit of help.  I got the letter dated 9 Sept regarding Pure Points.  I have 15,000 through a resort called Shanida Ltd I can't for the life of me remember how I got these.

Anyway there didn't seem to be any way of backing out from them so I signed the transfer agreement which transfers them to Combined Resorts Holiday Points Club Ltd (Crown Resorts).   The management fee for these points seems pretty steep at £211.50 for 2011 and the same amount for 2012.

I have a lot of points anyway in the RCI Points system as a result of ceding weeks to RCI points.

Do I have any options regarding terminating the 15,000 points?  Any advice gratefully received

Did you cede your weeks at a Crown Resort?  This is where you would have got your 15,000 points - you had to obtain additional points when joining RCI Points.  Shanida Ltd is a company that is linked to Crown Resorts.  Not sure if they are some kind of holding company. 

You were also offered the Crown Resorts transfer so this may mean that you joined RCI Points at one of their resorts.

Sue
Sue B

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