Travel + Leisure Settles SEC Loan Portfolio Disclosure Case for $975,000
SEC says Travel + Leisure obscured rescissions of 2,900 delinquent loans worth $77 million, improving loss metrics; company agreed to a $975,000 penalty.
Summary
The SEC filed a settled action against Travel + Leisure Co. on September 30, 2026, alleging misleading disclosures about two undisclosed timeshare loan projects from October 2019 to February 2021. The company allegedly rescinded more than 2,900 seriously delinquent or defaulted customer loans with about $77 million in balances, including roughly $34 million of defaulted loans, fully released requesting customers, and reversed the loans as though they had never been made. The SEC said this materially improved the reported loan loss provision and loan loss provision percentage, obscuring portfolio performance and estimated collectibility. It also alleged internal rescission targets were designed to meet public guidance, without disclosure of the projects or their effect on reported trends.
Without admitting the allegations, Travel + Leisure consented to a final judgment, subject to court approval, permanently enjoining violations of Securities Act Sections 17(a)(2) and 17(a)(3), Exchange Act Section 13(a), and Rules 12b-20, 13a-1, 13a-11, and 13a-13, plus a $975,000 civil penalty. The complaint, SEC v. Travel + Leisure Co., No. 26-cv-62760, was filed in the Southern District of Florida and announced through Litigation Release No. 26657 and Accounting and Auditing Enforcement No. 4603.
Positives
- The proposed judgment sets the civil penalty at $975,000, providing a defined monetary sanction if the court approves it.
- Travel + Leisure consented to a final judgment, making the SEC action settled, although court approval remains pending.
- Travel + Leisure did not admit the SEC’s allegations under the proposed settlement.
- The alleged disclosure period ended in February 2021, more than five years before the September 2026 enforcement filing.
Risks & concerns
- More than 2,900 delinquent or defaulted loans totaling about $77 million were allegedly removed and reversed as though never made.
- Roughly $34 million of the rescinded balances involved loans already in default.
- Internal targets allegedly specified how many troubled loans needed rescission to meet publicly disclosed loan loss provision percentage guidance.
- The SEC alleged the undisclosed projects materially improved reported loan loss measures and misrepresented portfolio performance and collectibility.
- The proposed judgment would permanently enjoin Travel + Leisure from future violations of specified Securities Act and Exchange Act provisions.
