Attorney General's News Release

June 28, 1999

Nixon sues to stop New Horizons from using deceptive practices in marketing travel services, timeshares

Jefferson City, Mo. — Attorney General Jay Nixon today filed for a court order to stop a group of businesses from using deceptive and illegal practices through prize contests and sales presentations in marketing travel services and timeshare memberships.

Several hundred consumers from the St. Louis area, other parts of Missouri and from Illinois are believed to have paid fees of as much as $5,000 apiece to the businesses, Nixon said.

He said the defendants, who often use the business name New Horizons, have made several misrepresentations to consumers through the contests and telephone solicitations to get them to purchase memberships. Named as defendants in the lawsuit filed in St. Louis County Circuit Court are Bailey & Associates Inc., Winner's Circle of Chicago Inc., National Resorts Corp. and Debra Lynn D'Amato. D'Amato was sales manager for the Brentwood office of Winner's Circle.

"Consumers have said they are getting little or nothing for the memberships for which they're paying thousands of dollars," Nixon said. "We believe that New Horizons, its employees and associated businesses misled these people into attending high-pressure sales presentations by using a prize promotion as the come-on."

Nixon said the defendants advertised, offered for sale and sold travel and resort memberships, time-share memberships, and discount buying services for travel and recreation. The defendants often marketed their services through telemarketing calls and through contest boxes advertising "new car giveaways," and placed in high-traffic locations. The sales meetings which followed the telephone solicitations often were held in the St. Louis area.

The lawsuit charges that the defendants have violated state consumer protection laws through deceptive and illegal practices by, among other actions:

• Misrepresenting to consumers that they had entered a contest when they had not and misrepresenting that they had won or would win specific prizes; Nixon said consumers given vehicle keys for the contest giveaway had no reasonable chance to win and that the keys were routinely reissued other consumers.
• Misrepresenting to consumers contacted in telephone solicitations that their names had been "pulled," failing to tell consumers contacted in telephone solicitations that a sales presentation was involved, and concealing that the purpose of the meeting was to offer memberships.
• Falsely promising to consumers that they, as members, could obtain condominiums and other vacation facilities in desirable locations at desirable times of the year, when such was not the case.
• Misrepresenting important information such as the prices and terms at which members would be able to obtain travel services, and the ability and ease with which members would be able to obtain various travel services.
• Placing information about the consumer's right of cancellation in a barely discernible typeface on the back of the contract.

Nixon is asking the court to issue an order preventing the defendants from continuing to commit any of the violations; that all contracts obtained in an illegal fashion be rescinded; and that the defendants pay appropriate restitution to consumers and penalties and costs to the state of Missouri.

Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

All media inquiries should be directed to Press Secretary John Fougere.

E-mail      Phone: 573-751-8844         Fax: 573-751-5818