• Report: #224127

Complaint Review: Resort Holding - Michael Eugene Kelly

  • Submitted: Wed, December 06, 2006
  • Updated: Thu, April 15, 2010

  • Reported By:bradention Florida
Resort Holding - Michael Eugene Kelly
3222 Mishawaka Ave South Bend In. Nationwide Mexico
  • Phone: 888-838 9100
  • Web:
  • Category: Resorts

Resort Holding Michael Eugene Kelly securities fraud illegal ponzi envestment scam ripoff Cancun, Quintanaroo south bend In.

*Consumer Comment: IP Fund 1 Leaseholders come together

*Consumer Suggestion: IP FUND1 UPDATE Ernest Bustos

*Consumer Comment: Who is Ernest Bustos?

*Consumer Suggestion: FBI agents have arrested an American hotel owner

*Consumer Comment: Hard to Help

*Consumer Comment: Hard to Help

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We went to pizza party put on by our traller park were we met the speaker bill boston vice president of century estate planing. we thought every thing ok we took out A living trust. Then he introduce us to resort holding universal lease All went well one year and a half then it started go sour. We contacted Florida financal services commision. we are still wating for A reply. we are open for help

bradention, Florida

This report was posted on Ripoff Report on 12/06/2006 09:18 PM and is a permanent record located here: http://www.ripoffreport.com/r/Resort-Holding-Michael-Eugene-Kelly/nationwide/Resort-Holding-Michael-Eugene-Kelly-securities-fraud-illegal-ponzi-envestment-scam-ripoff-224127. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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#1 Consumer Comment

IP Fund 1 Leaseholders come together

AUTHOR: Ernest - (U.S.A.)

The leaseholders need to intervene in Kelly's criminal case to protect their leaseholders rights to hold RHI, Grupo Kelly and others civilly responsible!  The order appointing the special master obligates the SM to cause Kelly to add Assets to Restitution Fund necessary to make full restitution and pay SMs fees and/or obligates the Court to expand the Restitution Fund to include all necessary Assets to make full restitution to victims and pay fees.  The appointment does not preclude victims from pursuing any rights they may have that do not encumber, restrain or dissipate the Assets, enforcement of any rights (specifically characterized as a lien) against the Assets or Legal Structure unless the Court orders otherwise. However, the special master's claim form is contrary to the courts order of appointment. The claim form bars victims not adhering to the Claims procedure from asserting a claim against SM, Claims Processing Agent; Restitution Trust, Kelly Business Entities or any successor in interest to or third party beneficiary of any asset owned by or affiliated with Grupo Kelly The claim form recognizes a possible difference between amount of loss calculated for criminal restitution and that could be awarded a defrauded investor in a civil lawsuit, and that criminal restitution does not supplant a civil judgment.  Assets collected by SM will not be available to satisfy any civil judgment against Kelly.

Coming Victim Claim Form  (i) D. Waiver/Release (a) terminates leases (b) bars claimant from asserting any claims against SM, CPA and waives claims regarding the universal Lease Program including lease, any assets purchased with proceeds, any remedy entitled to under the Universal Lease Program [waived and assigned in benefit of SM or designee. (c) bars claims against any transferee of or successor in interest to any asset or any third party beneficiary of any asset owned by or affiliated with Grupo Kelly.  The special master wants the leaseholder to terminate their leases claiming the hotels can be sold free and clear of liens, however, I believe that they are not canceling all the other timeshares Kelly sold. "Therefore the hotels would not be free and clear of liens". The special master also wants the leaseholders not to hold him responsible for his actions, however, when the court appointed him; the court gave him immunity as long as he did not do anything outside of his appointment. If his actions are in line with his appointment he would have no immunity. Why is he asking the leaseholders to waive their rights to hold him responsible for his actions?    

If you sign the claim form you are buying the pig sight unseen and you will have no recourse because you signed your rights away! It is clear the special master is attempting do keep the leaseholders from going after some of the assets and others. It is also clear that his actions are not inline with his appointment.  Furthermore the special master doesn't disclose how much of your money will be recovered. For all we know its pennies on the dollar! 

If you are a leaseholder and have not joined with other leaseholders please go to (((ROR redacted))) more information to join.



San Antonio, TX 78209

(((ROR redacted)))


CLICK here to see why Rip-off Report, as a matter of policy, deleted either a phone number, link or e-mail address from this Report.
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#2 Consumer Suggestion

IP FUND1 UPDATE Ernest Bustos

AUTHOR: Ernest - (U.S.A.)

October 8, 2007

Dear Lease Holder,

The Fund has been very active for almost two years; we have held our cards close to our chest and it has paid off again. As you know, the FBI arrested Kelly on December 22, 2006 in Florida, however, the Department of Justice (DOJ) has not formally indicted Kelly or named anyone else. I view this as a way to keep Kelly in check, it helps us too and it appears that the DOJ may not go forward with a criminal action. I believe it's because of the Securities and Exchange Commission's (SEC) refusal to admit that Kelly's fraud is a violation of Racketeer Influenced and Corrupt Organizations Act statutes (RICO) and not SEC laws.

The DOJ continues to ask for, and has received, 5 extensions to date. The DOJ claims they are waiting for an offer from Kelly that will make the Leaseholders whole. Please, hold onto your normal reaction that all you want is your money back and nothing else; this is what Kelly and the SEC want you to feel. Fear of the unknown and the fear you will not see your money is a normal reaction. Making the leaseholder whole would be only 50% because leaseholders lost the use and the return on their money! This fear comes from an old saying I'm not as concerned on the return on my money as I am the return of my money The assets are there and the leaseholders should get more than just their money!

I believe they are stalling to allow the SEC to move its complaint of investment fraud, which is viewed as nothing more than a disgorgement action. This delay is an attempt to allow the SEC to appoint its own receiver who will line his pockets with $ millions due to you to "investigate wrongdoing" and the victim's recovery is always secondary. The Receivership process can be a wolf in sheep's clothing and, in many cases, they are because the investors end up with little or nothing.

The leaseholders have a chance to change this by coming together! Our research uncovered 24 confirmed conspirators who have been named in our civil RICO complaint. We retained co-counsel in Dallas, Texas and filed our complaint on September 12, 2007, under seal, to conceal the identities of the 24 conspirators to prevent them from hiding their assets and/or money. The Fund's complaint is asking for almost $300 million in damages for our members under RICO statutes.

Once the case starts there will be a formal complaint filed with the Justice Department requesting a criminal investigation for violations of the Criminal RICO statutes. RMG will refer the wrongdoers to the proper enforcement agencies.

A new company has been established, Resorts Management Group LLC (RMG), controlled by its Board of Directors made up of Leaseholders and will have a website coming soon www.resortmanagementgroupllc.com The complaint asks the court to allow the leaseholders' company, RMG, interim relief and allow a Leaseholder Receivership to take control of the assets that their money purchased, including Kelly's assets and those of his co-conspirators. These assets now belong to the Leaseholders, NOT THE SEC OR THEIR RECEIVER!

The Court agreed that there is a need for interim relief and Receivership and asked if the SEC has asked for interim relief. We know they did not. The Judge asked our lead attorney to make contact with the SEC; he did and they asked for a copy of our sealed complaint. Our attorney asked them to agree to a confidential agreement to make sure they could not use our complaint or give it to Kelly's attorneys. They agreed!

The SEC will not go away quietly and they have also asked for a Receivership. The SEC attorneys stated they would not agree to a receivership where they could not control RHI's assets. They forget it's, WE THE PEOPLE !!! Our lead attorney states: The battle is going to be over the interim relief and the receiver, and the question will be whether the SEC has anything to say other than that they do not see the unity of one. The Complaint cannot be attacked. Even if the SEC asserts that the wrong is a violation of the securities laws that is no reason to say we cannot sue on an alternative theory. "The most terrifying words in the English language are: I'm from the government and I'm here to help." - Ronald Reagan.

The Fund has done what it represented it would do and if the leaseholders are allowed the interim relief, RMG will take the place of the Fund as the lead activist. The Fund members are the largest claimants trumping any SEC claim.

The Fund will continue to advocate in its members best interests. The Board of Directors are looking at what actions can be taken against those brokers that have not acted in good faith or have been willfully blind and I agree! Presently we do not have a list of the 9000 leaseholders and some don't even know they have a problem because their brokers have abandoned them!

Here is some of the latest information and confirms we're right on track!!

The FBI admits they are fighting with Mike Kelly's attorneys, the leaseholders, and the Mexican Government. Shock! Why would they fight with the ones they are supposed to protect from cons like Kelly?

All of the resorts are in operation and bringing in money but they are just breaking even. Well, this is because of how Kelly set them up; we want to look at the books before we accept that claim. How about the second largest nightclub in Mexico at a cost of $23 million, marinas, yachts, car rental company, car company, 183-foot yacht, Ferraris, personal jet, family corporations and all other corporations started after the Universal Lease program, etc?.... It is our understanding that there may be as many as 150 businesses.

The FBI wants to sell Port of Cancun to the Mexican Government to pay the leaseholders. The Puerto Cancun has the potential of bringing in over a Billion Dollars to the leaseholders, which is more than enough to repay the leaseholders. The Mexican government holds 12% of this project now, the leaseholders own the rest! Why would the leaseholders sell it at a loss? RICO laws allow the leaseholders to claim 3 times the amount of their damages.

It is more important than ever to have the leaseholders come together to take a stand.

Very truly yours,
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#3 Consumer Comment

Who is Ernest Bustos?

AUTHOR: Ernest - (U.S.A.)

January 10, 2007

Dear Lease Holder,

This is our first update to all our members by mail and I want to wish you all a happy new year. I do want to encourage you to register for our emails so that you can receive our ongoing information. I also want to let you know we have moved and the new address is on the bottom of the second page. Our phones have been down for a few weeks because AT&T would not allow us to continue with the phone number we have had for 16 years, so we changed phone companies and are taking our phone number with us.

The Fund placed the IRA Custodians and the State of Wisconsin Division of Securities on notice of Kelly's fraud and also placed notices on the Internet. Here is a small excerpt from one letter to a Custodian 3/06: RHI and its principles are involved in a $450 million scheme. There are ongoing FBI investigations surrounding RHI's and Kelly's fraudulent enterprise. Mike Kelly (?Kelly?), RHI and their co-conspirators are attempting to use IRA Custodians to further their fraudulent enterprise by asking the Custodians to forward an offer to buy back the leases for 75% of their purchase price without reimbursing the owners for the past due rental income. IP Fund 1 Inc. (?the Fund?) and its members are placing the IRA Custodians on notice that there is an ongoing effort by the Fund to file a formal Racketeer Influenced and Corrupt Organizations.

The Fund has been very active, we have held our cards close to our chest and it has paid off. The FBI arrested Kelly on December 22, 2006 in Florida. This is a good thing and will help the Fund's RICO complaint. Here is what the FBI is claiming:

Associated Press
December 28, 2006, 7:04 AM CST
CHICAGO -- FBI agents have arrested a man on charges that he used time-share leases in Mexico to bilk real estate investors, including several in Illinois, out of $400 million. Michael E. Kelly, 57, allegedly sold "universal leases" on time-share properties and promised buyers an 11 percent returns on their investments, according to a criminal complaint released Wednesday. Kelly, of Cancun, was arrested Friday in Jacksonville, Fla. He is in custody in Florida and will be brought to Chicago to face federal mail fraud charges, officials said. It is not immediately clear who Kelly's lawyer is. Authorities allege that he told investors that a third-party company would rent their time-shares. He also allegedly guaranteed high returns even if the properties weren't rented. But Kelly owned the third-party company and paid out the returns to investors himself, authorities allege. Eventually he stopped making payments and instead spent investors' money on a lavish lifestyle that included a private plane and a large yacht, officials said. He allegedly netted $400 million from the late '90s to 2004. Jennifer French, a financial institutions fraud special agent for the FBI, said investors didn't see the red flags in the deal until it was too late. "Many of these folks eventually said it was just too good to be true, but the victims were diverse," French said. "Some of these people were sophisticated investors."

I am sure more arrests are to come.

The Fund's attorneys are working with the FBI. The FBI has requested our members complete the enclosed questionnaire and return it to us before the 18th by fax or mail. We sent the news of Kelly's arrest to the Mexican newspapers to turn up the heat on Kelly at home and are working with them to expose all of Kelly's fraud there also.

The Fund's investigation uncovered 17 conspirators who may be named in our complaint or turned over to FBI and we will work with the FBI to get a handle on Kelly's and his conspirators ill-gotten gains and assets. We can now serve Kelly with our RICO complaint in jail; this should force a Receivership showdown. We will ask the court to allow the leaseholders to take over all the companies that received leaseholder money from Kelly or were started with leaseholder money, however, the government will not go away quietly. "The most terrifying words in the English language are: I'm from the government and I'm here to help." - Ronald Reagan. The agency in charge will want the court to allow them their own receivership claiming it is to protect the investors, however, the Receivership process can be a ?wolf in sheep's clothing?.

It will be a dogfight to keep the government out as a receiver now that Kelly has been charged with fraud. The law is on the side of the investors, however, no one is ever on the ready to derail the appointment. This is why the government always appoints its own receiver who will charge millions in fees to "investigate wrongdoing" and the victim's recovery is always secondary.

There will also be attorneys surfacing, wanting to represent you for a fee of 30% - 50% of your recovery. Do not surrender your money. As members of the Fund, your claim will be pursued and the Fund will pay for the attorneys from the membership fees, no attorney's fee will be taken from the recovery.

It is more important than ever to have the leaseholders come together to take a stand. We propose to form a new company made up of leaseholders. The board of directors to head up this new company will also be leaseholders who will not take a paycheck and will act in the best interest of the leaseholders. This will cut out millions of dollars of expenses for a FTC or SEC Receivership. If you would like to be considered as a board member please fax us your resume to: 210.828.0096 or 7088.
For those leaseholders and brokers sitting on the fence, there is no time to take a wait and see attitude! It is time for the leaseholders to come together, ?When spider webs unite, they can tie up a lion.

Who is Ernest Bustos? As a consumer advocate for the last 27 years, he has helped individuals file complaints and recover money from attorneys, investment advisers and insurance companies. Mr. Bustos has served on the Presidential Business Commission, the NRCC Business Advisory Council, named Texas Businessman Of The Year and received the Ronald Reagan Republican Gold Medal award for his business leadership. There are no client complaints filed on him for any reason in his 27 years as an insurance agent or as a Registered representative for 15 years and a Registered Principal for 10 out of the 15 years. Bustos has the knowledge and experience to be able to consult with individuals on how to advocate on their own behalf. He underwent background checks by the Justice Department for those registrations. He oversaw the actions of brokers and had over $22 million under management in his agency. The statement made by Receivership attorneys that Bustos was guilty of securities fraud is a false allegation and is meant to inflame the investors. There has not been such a finding in any court. This conduct is viewed as defamatory, meant to scare the investors.Personal character attacks are an underhanded attempt by Receivership attorneys to muscle the consumer into thinking they have no alternative but to allow the Receivership to control the remains of their interest. Such practices should be stopped.
One of these attacks is from LifeTimes Recivership attorneys that sold the investors down the river. They sold investments worth $130 million for $13 million. Bustos provides an alternative to the process that has proven itself abusive in the past. The Court and the investors have alternatives. Bustos objects to receivership laws that benefit a select few with a blank check that can be drawn against investor's monies. These ?good old boys? are allowed to spend the victims' funds to conduct investigations. One Receivership had its Fees cut by over $900,000 because of Bustos efforts. No wonder they do not like him!
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#4 Consumer Suggestion

FBI agents have arrested an American hotel owner

AUTHOR: Ernest - (U.S.A.)

Well, Christmas came twice this year. Back in March of this year we sent an email to our members to inform them that a Grand Jury had been seated to investigate Kelly, however, there was no release of information.

We had meeting already set for today with the attorneys to go over the RICO complaint to be filed before the end of the year, however, this meeting took on a different meaning and the attorneys were very happy to see that Kelly was arrested on the 22nd of this month.

Our original attack plan was to file and then breing in the FBI to investgate the complaint now, we are now attempting to make contact with the FBI to offer our assistance and information to round up all the bad actors. With Kelly's arrest it will make it easier for our complaint be filed and accepted by the courts.

I believe he is a flight rusk and should be kept in jail. This is truly great news. Please read the press release.

Thank you for your support,
Ernest Bustos

Mexico hotel owner charged in swindle of time-share leases
By Rudolph Bush
Tribune staff reporter

December 28, 2006

FBI agents have arrested an American hotel owner on charges he ran a $400 million pyramid scheme through the sale of time-share leases in Mexico.

Michael E. Kelly of Cancun was arrested Friday in Jacksonville, Fla., and charged with cheating hundreds of investors, including several from Illinois.

According to a criminal complaint released Wednesday, Kelly sold "universal leases" on Mexican time shares to investors who thought they would get return rates of up to 11 percent.

Kelly, 57, purportedly told the investors that an independent third-party company would rent their time shares. He promised that the investors would receive high returns even if their properties weren't rented, the complaint alleges.

In fact, Kelly owned the third-party companies and controlled the returns provided to investors, authorities allege.

An attorney for Kelly could not be located Wednesday. He is in custody in Florida and is expected to come to Chicago for an initial appearance at a future date.

According to authorities, Kelly's scheme netted some $400 million from investors from 1997 to March 2004.

During that time, he owned five hotels in Mexico and one in Panama. Time shares at the Mexican hotels were used to further the scheme, authorities allege.

Although many investors initially did receive returns on their leases, the scheme collapsed when several states cracked down on Kelly's operation and new investors from the U.S. dried up, authorities allege.

Meanwhile, Kelly used the proceeds of the scam to pay for a lavish lifestyle that included a private plane, a yacht and Cancun homes for himself and three children, authorities allege.

He also bought a luxury car dealership in Georgia that required regular infusions of cash to stay afloat, according to the criminal complaint.

Once the bottom dropped out, investors stopped receiving any returns and began asking for their money back.

One victim in Illinois took a reverse home mortgage to fund a $100,000 investment in the time-share scheme. Another put $500,000 of his own money and $305,000 of his mother's into Kelly's time-share business.

Someone working for one of the purported third-party companies told another investor that the chance of getting any money back was "slim," the complaint alleges.

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#5 Consumer Comment

Hard to Help

AUTHOR: Juliet - (U.S.A.)

It's hard to help when no details are given.
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#6 Consumer Comment

Hard to Help

AUTHOR: Juliet - (U.S.A.)

It's hard to help when no details are given.
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