One of the Trump Administration’s priorities for dismantling the Jalisco New Generation Cartel (CJNG) is to strike at its sources of revenue. One of those sources—aside from drug and fuel trafficking, which has generated more than $400 million in profits for the criminal organization—is a front used to run timeshare scams that defraud elderly U.S. and Canadian citizens. On February 19, Washington sanctioned a network of 17 companies in Puerto Vallarta and Nayarit, including the Kovay Gardens resort, for a scam that targeted roughly more than 6,000 people in the United States.
Testimonies from victims and documents obtained by EL PAÍS reveal a scheme that simulates a maze with no exit: illegal charges to release victims from these vacation packages have continued to be made nearly six months later by alleged companies in Mexico and the U.S. working on behalf of the criminal group.
A timeshare is a vacation ownership model in which a buyer acquires the right to use accommodation (a hotel room or condominium) for a specific period each year—usually one week—paying an upfront price and annual maintenance fees. Laura, a pseudonym used to protect the victim’s identity, says she had no interest in buying another such service in Nayarit. She already owned these kinds of vacation packages at other locations that she wanted to get rid of. When Kovay Gardens representatives presented their offer and the Mexican company Blue Point Converters offered to buy her other memberships, she agreed to sign a contract.
She estimates she paid about $30,000 for her membership at Kovay Gardens. One clause in the contract stated that to receive the proceeds from the timeshares she was selling she would have to wait a year. “In a year I was going to receive almost $110,000 for my other timeshares. That’s how they convinced me. The purchase of the Kovay Gardens package and the sale agreement were done the same day. The documents were provided by a Blue Point Converters sales representative named César Cárdenas, and the authorization on behalf of the resort was signed by Arturo Vera,” Laura says by video call.
The agreement Laura signed was executed in March 2025 and, after a year, she expected to be contacted to receive the money promised for the sale of her timeshares. Instead, at first callers gave her excuses and asked for more time, saying they would contact her in seven days, until they stopped answering her calls. That’s when she realized it was a scam. That occurred in March 2026, about two weeks after the Treasury Department had exposed the CJNG’s fraudulent network at Kovay Gardens, which was carried out through the resort’s founder, Carlos Humberto Rivera Miramontes, who “has a long history of voluntarily collaborating with drug traffickers.”
A textbook scam
His resort opened more than 20 years ago and, according to the charges against him, he works closely with businessman Michael Ibarra Díaz Jr., who is also affiliated with that criminal organization and was identified as a facilitator in the sale of timeshares to U.S. and Canadian tourists who are later defrauded. One of the companies sanctioned by the Office of Foreign Assets Control (OFAC) was Administradora y Comercializadora del Mar, S.A. de C.V., which provides various services to Kovay Gardens, including hotel reservation processing.
Laura says she learned about the sanctions from friends who saw the news. At no time, she explains, did she receive an email, call or notice from the resort or from Administradora y Comercializadora del Mar with any statement, clarification or denial about Washington’s accusations. Kovay Gardens suspended its formal customer service channels and reservations and deactivated its websites and social media accounts after the sanctions imposed by OFAC and Mexico’s Financial Intelligence Unit (UIF).
Both agencies froze accounts and sanctioned companies and individuals linked to the Nayarit complex. However, on March 14 a Kovay Vacations email to its members informed them of a change of domain and communication channels to Selvara Signature Collection, an alias linked to VG Desarrollos de la Bahía, a company connected to the resort and also listed among those sanctioned by OFAC.
“We sold our timeshare interest in the United States to Selvara Signature Collection in exchange for a Mexican resort called Kovay Gardens. They promised us an amount higher than the value we estimated for our timeshare, or else a full refund of our investment after one year. We received nothing,” says Huguill, another fraud victim who asked to remain anonymous.
The Kovay Gardens scam was out of a textbook. Jeremiah, another U.S. citizen who asked to withhold his real name, experienced exactly the same thing as Laura. In a second phase of the fraud, the companies Blue Sky Realty and Title Escrow Services, with offices in Massachusetts and Memphis respectively, proposed taking on Blue Point Converters’ default and buying their Kovay timeshares. Blue Sky promised to pay him more than $100,000 for his Nayarit vacation plan and said Title Escrow Services would handle the paperwork.
Title Escrow Services told him that to register with Mexico’s Tax Administration Service (SAT) he had to pay just over 66,000 pesos, approximately $3,700. However, the receipt they shared names Grupo Comercial Mow S.A.S. de C.V. as the beneficiary. A search of the Public Registry of Commerce shows that this company is not legally incorporated.
Later they told him he had to pay 85,000 pesos (almost $5,000) for state taxes related to the timeshare transaction in Nayarit. He also paid that amount for the alleged requirement. For both procedures they shared documents—both from the SAT and a payment acknowledgement for a definitive state tax declaration from the Government of Mexico City, not the State of Nayarit. Both documents list Heriberto Sánchez Esquivel as the alleged legal representative. The email with both alleged certifications was sent to him by a Title Escrow representative. “We share with you the receipt that the Mexican government sent us showing that you have complied with the request. We will send all documentation and keep you informed on the matter,” the U.S. company representative wrote in the correspondence.
Document inconsistencies
Luis Pérez de Acha, an attorney specializing in tax fraud, reviewed both documents and concluded they are “completely false.” “If the property is in Nayarit, the Government of Mexico City has nothing to do with it. Second, SAT paperwork and the capital government’s paperwork never come together. Third, it refers to a state tax. The SAT does not collect state taxes. It makes no sense. They are clearly falsified,” he explains by phone.
Title Escrow also acted as an alleged intermediary to create an account for him at BBVA bank where his investment was supposedly deposited and ready for recovery. In another email they shared falsified bank statements in his name from that institution purporting to show a “cross-border account” from the bank’s “Cross-Border Division.” BBVA officials have told this newspaper that the documents shared with Jeremiah contain “inconsistencies.” A bank spokesperson also said they do not offer a product called a “cross-border account.”
The last demand made of Jeremiah was a payment of nearly $6,000 (about 103,000 Mexican pesos) for federal taxes so he could receive the more than $100,000 they had promised him for his timeshare. EL PAÍS contacted the UIF to report the complaints received and to ask whether any actions beyond the sanctions issued last February have been taken. A spokesperson said, “for the moment we cannot comment on this matter.”
Maxine, another complainant who prefers not to reveal her name for fear of reprisals, says a law firm in Monterrey called Sander, Meyer y Asociados contacted her as a representative of Comercializadora del Mar, S.A. de C.V., the developer of Kovay Gardens in La Cruz de Huanacaxtle, Nayarit.
In the email they sent her, they explain that the developer has hired them to deal directly with affected clients. The law firm proposed a single payment of more than $300,000 for a “contractual breach” by Blue Point Converters “to resolve the dispute between the parties in order to mitigate any reputational impact and resolve the matter promptly.” Hundreds of victims organized in Facebook groups over the Kovay Gardens fraud say these purported law firms often impersonate corporate registries with similar formal company names to give a false sense of security. “They contact you promising multimillion-dollar settlements, but first demand advance transfers for fees, taxes or legal procedures,” one affected user said in one of these online groups.
Other companies that appear to operate with the same method and have contacted Laura, Jeremiah or Maxine include Boutique Private Residence Club, based in Punta Mita, Nayarit; and real estate firms such as Philly 1st Real Estate or East Coast Real Estate Investments, both allegedly located in Philadelphia.
“They promised them profits from selling or renting [their timeshares]. But first they had to pay ‘taxes’ and an ‘initial fee.’ Of course, those profits never materialized,” said Thyssen Duva, deputy chief of the Criminal Division at the Department of Justice, adding: “This sophisticated scheme generated illicit proceeds that the CJNG used to fund its operations: trafficking drugs, buying weapons and paying bribes.”
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