Business Practices Committee Report 75

On 17 December 1997 the Committee received a complaint from the Timeshare Institute of South Africa (TISA) about Alpha Club. In its letter TISA stated inter alia:

"We have attempted to ascertain the nature of their products and in discussions with RCI it appears that Alpha Club is relying on a voucher scheme, which is available in the industry. This once again means that the accommodation is totally dependant on availability and that the club itself does not own any stock emanating from the voucher scheme".

On 22 January 1998 the Committee received a complaint from RCI Southern Africa in which it was inter alia stated:

"The Alpha Club are, we believe claiming to be affiliated to RCI and to have access to accommodation in this country, whilst we acknowledge that a lead generation agreement exists with RCI Portugal, RCI Southern Africa has no agreement what so ever with the Alpha Club. Furthermore RCI Southern Africa will not supply accommodation to Alpha members unless he/she is a bona fide timeshare owner at an RCI affiliated resort and a paid up member of RCI Southern Africa".

On 24 June 1998 the South African Reserve Bank wrote to the Committee and stated inter alia:

"The Registrar of Banks has reason to suspect that the above-mentioned organisation is and/or has been conducting the business of a bank whilst it is not registered as a bank in terms of the Banks Act, 1990 . For your information, please note that we are currently in the process of establishing whether this is, in fact, the case. Furthermore, this office would appreciate to learn whether you have any information in your possession relating to the activities of the Alpha Club, especially since is may be a possibility the Newport Business Club (Pty) Limited may be involved in the said scheme"

Commercial Crime Units of the South African Police Services also brought the activities of MFS/Alpha to the attention of the Committee. On 26 May 1998, for example, the Commercial Crime Unit of Mpumalanga alleged that MFS/Alpha contravened Notice 1350 (see the first paragraph of this Report). The Committee also received a number of enquiries from individuals.