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Re: Manhattan Club Lawsuit (by Robert B.):

For those of you who may be interested in writing to the new NYAG, I'm enclosing one of the last letters I wrote to Ms. James. Feel free to use any part of it in your own correspondence. I believe I received a boiler plate "thank you for your letter" response.

Bob Biello

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March 11, 2019

Ms. Letitia James N.Y. Attorney General The Capitol Albany, NY 12224-0341 Re: Case # 451536/2014 Schneiderman v. Eichner

Dear Ms. James:

My wife and I are among the thousands of owners of timeshare interests in The Manhattan Club who have been defrauded by the improper conduct of Ian Bruce Eichner, a Manhattan real estate billionaire, members of his family, and a close circle of associates. In July, 2014, your office began a 3 year-long criminal investigation which discovered evidence that Eichner and his associates played a direct role in carrying out a huge timeshare scam against an estimated 14,000 to 18,000 Manhattan Club owners for at least 10 years, defrauding us out of tens of millions of dollars. My wife and I and literally thousands of other timeshare owners have suffered very significant financial losses due to the fraudulent conduct of the Eichner family, The Manhattan Club, and its related companies.

Based on evidence gathered during your investigation, we learned that Eichner has been personally skimming $6,000,000 a year from The Manhattan Club through a shell management company called “Urban”. For years, this company had no employees and provided no services to the operation of the timeshare property, yet our timeshare corporation was paying them (Eichner) $6 million a year! In July, 2017, your office announced that the NY Attorney General had reached a settlement with the respondents in this case, and was ending its investigation into the operation of The Manhattan Club timeshare with the signing of an “Assurance of Discontinuance.” On August 14, 2017, your office signed assurance no. 17-149, on behalf of the NY Attorney General, with the respondents in this case. Unfortunately, the settlement fails to address the respondents’ admissions of guilt, and most of the allegations of criminal wrongdoing committed against us timeshare owners by Ian Bruce Eichner and his close circle of associates.

As we owners feared, Eichner et al are violating the terms of the assurance with impunity. We knew that the agreement would only be effective if the respondents actually carried out the stipulations to which they agreed when signing the Assurance of Discontinuance. It would be helpful if we had a contact person to keep affected owners informed. Owners have received ZERO communication from your office. Has anyone in your office been assigned specific responsibility to monitor adherence to the conditions in the assurance? What steps can you undertake to carry out necessary enforcement actions?

I have been closely monitoring the Internet for word that the conditions in the Assurance of Discontinuance are being properly carried out or enforced. Unfortunately, during the year and a half since your office announced the settlement, I have not seen any evidence that the stipulations Eichner agreed to have actually been carried out. Quite the opposite is true. They are routinely violating the agreement. The Assurance of Discontinuance section titled, “PROSPECTIVE RELIEF,” page 12, paragraph 61, states in part, “Respondents and their agents and employees, including The Manhattan Club Timeshare Association, Inc., shall not engage in any act directly or indirectly relating to the offer, purchase, sale, issuance, advertisement, marketing, promotion, distribution, negotiation, exchange or transfer of any timeshare interest...” Within the last few months, the respondents have been trying to extort owners into the acceptance of $100 token payments to entice them into relinquishing their timeshare ownership, for which they paid tens of thousands of dollars, in return for forgiveness of minor arrears in maintenance payments. Paragraph 62 states that, “Respondents shall enter into an agreement with the third-party operator of timeshare properties (TMC Purchaser) previously identified to the OAG on or about July 28, 2017…” Who is this third-party operator (TMC Purchaser)? Has the required agreement been signed? If so, when? If not, what enforcement steps will the AG’s office take due to this violation of the assurance? Paragraph 63 of the assurance states that, “All Sponsor-appointed officers and directors will resign from their positions as members of the board of the Timeshare Association…” There have been no reported resignations of any officers or directors of the Timeshare Association. What enforcement steps will the AG’s office take due to this violation of the assurance? The Assurance of Discontinuance section titled, “RESTITUTION,” page 14, paragraph 65, itemizes a schedule of payments respondents are required to make as a condition of the assurance. Their first payment of $3,250,000 was due 15 days after the release of frozen funds. Has your office received this payment? If so, when was it received and when will these funds be distributed to timeshare owners? If not, what steps will the AG’s office take due to this violation of the assurance? Your investigation uncovered evidence that Eichner and his cronies engaged in a massive timeshare fraud. They have demonstrated that they are not honorable people and I would not be surprised to learn that, in addition to the violations I listed above, they have not carried out any of the stipulations to which they agreed when signing the Assurance of Discontinuance. As a result of the fraudulent conduct perpetrated against us by Mr. Eichner, The Manhattan Club and its affiliates, as well as the NY Attorney General's allegations of fraud and other criminal conduct, I urge you to take whatever steps are necessary to force them to comply with the conditions of the Assurance of Discontinuance and to impose appropriate penalties due to the ongoing violations. Sincerely yours, Robert A. Biello