Oh, Kovay Gardens. Where do we even start?

Kovay Gardens appeared to be just another vacation ownership option on the coast of La Cruz de Huanacaxtle. Situated along Bahía de Banderas and not far from Puerto Vallarta, the resort was presented to the public with appealing visuals, idyllic descriptions, and the kind of marketing language that tends to blend seamlessly into the broader landscape of Mexican timeshare promotions.

Nothing about it seemed out of place. The photos showed modern villas, curated landscaping, and the familiar promises of comfort and relaxation. It was the type of property you could easily scroll past online and think, “Looks nice.” Even when it operated under its former name, Vallarta Gardens, it came across as a standard timeshare destination—one more option in a crowded market.

But behind the palm trees and marketing gloss, Kovay Gardens was quietly building toward a plot twist no one saw coming.

A Resort With an Unclear Foundation

Kovay Gardens—originally Vallarta Gardens—traces its history back over twenty years, developed under founder Carlos Humberto Rivera Miramontes and marketed toward U.S. and Canadian buyers. Rivera Miramontes also operated a wider corporate network tied to tourism and real estate, supposedly supporting the resort’s operations.

Another individual involved, Michael Ibarra Díaz Jr., was also on the radar of U.S. authorities, and together with 17 affiliated companies, they formed part of a corporate cluster later identified by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC).

Yet even before the sanctions, something about Kovay Gardens stood out—though not loudly enough to raise alarms at the time. Unlike legitimate hospitality groups, it lacked recognized affiliations, clear governance, verified public filings, or transparent ownership structure. Nothing that placed Kovay Gardens alongside legitimate players like Vidanta or other established vacation ownership groups. And while those issues can happen in the timeshare world without indicating wrongdoing, the absence of clarity became far more significant in hindsight.

What looked like normal industry quirks were really early signs of how loose and unaccountable the operation actually was.

The 2026 Sanctions: When Everything Became Clear

The real turning point arrived in February 2026, when OFAC issued sanctions against Kovay Gardens, its related entities, and individuals linked to the property. The findings connected the resort to the Cartel de Jalisco Nueva Generación (CJNG), and from that point forward, the entire narrative changed.

What followed was the unraveling of a story that had been operating behind a polished exterior for years.

1. Alleged Involvement in Timeshare Fraud Schemes

U.S. authorities alleged that Kovay Gardens was part of an extensive fraud network that targeted U.S. citizens—often older adults—with deceptive promises of rental income, inflated resale prospects, or nonexistent buyers. The schemes relied on collecting upfront fees under false pretenses.

This wasn’t a case of typical high-pressure sales tactics. It was a coordinated operation using the resort’s customer lists and ownership information as a direct pipeline for exploitation.

2. Massive Financial Impact on Consumers

Authorities estimate that thousands of people collectively lost hundreds of millions of dollars through these fraudulent schemes tied to the Kovay network. Many victims were everyday timeshare owners who simply answered calls they believed were legitimate.

What made it even more alarming was the structure: the resort generated the leads, and related companies followed up with increasingly sophisticated, misleading offers. This wasn’t random opportunism—it was organized and intentional.

3. Sanctions and Enforcement Actions

Kovay Gardens, alongside its affiliates, was designated by OFAC for facilitating or supporting CJNG operations. Given that the CJNG had already been labeled a Foreign Terrorist Organization, the sanctions underscored the severity of the allegations.

4. Investigations on Both Sides of the Border

Mexican agencies—including the Fiscalía General de la República and the Unidad de Inteligencia Financiera—initiated their own investigations in response to the U.S. findings. U.S. assets tied to the resort were frozen, and Americans were barred from financially engaging with the property or related companies.

Once the sanctions took effect, Kovay Gardens as a functioning resort essentially disappeared.

The Aftermath: What Kovay Gardens Has Become

Today, Kovay Gardens no longer resembles anything close to its marketed identity. Its online presence has either diminished or been removed. Operations have stopped. Whatever “luxury” image it once advertised has collapsed under the weight of international scrutiny.

For many owners, the shift was abrupt and disorienting. People who had paid maintenance fees, attended presentations, and trusted in the legitimacy of the resort found themselves watching its entire foundation dissolve almost overnight.

When a timeshare collapses because of poor management, that’s one thing. When it collapses because it was allegedly entangled in organized crime and large-scale fraud—that’s a completely different situation. And a deeply unsettling one.

What Former Owners Should Know

If you once held a timeshare with Kovay Gardens, there is one piece of practical good news: Your contractual obligations are effectively void. A sanctioned and non-functioning resort cannot enforce maintenance fees or ownership terms.

But this relief comes with the unfortunate realization that the damage—financial and otherwise—had long since been done. Many owners spent years funding a resort whose operations were not at all what they appeared to be.

It’s the kind of outcome no timeshare owner expects, and one that shouldn’t have happened in the first place.

The Broader Warning for Timeshare Owners Everywhere

You may not need an exit company for Kovay Gardens specifically now, but its story highlights why a reliable timeshare exit service can be so important for other properties.

Kovay Gardens wasn’t an obvious scam at first glance. It wasn’t surrounded by online outrage or widespread warnings. It looked like countless other resorts. That’s what makes its collapse so disturbing: sometimes the issues aren’t visible until they become impossible to ignore.

If you currently own a timeshare and are facing things like:

• repeated upselling,
• unrequested resale offers,
• sudden fee hikes,
• or difficulty getting straight answers from the resort,

those are signs that professional help may be necessary. Not because every resort is hiding something comparable to Kovay Gardens, but because the timeshare industry can be unpredictable—and not always in ways that owners can navigate alone.

A reputable exit company can help evaluate your situation, review the legality of your contract, and protect you from falling into the types of traps that allowed Kovay Gardens to operate unchecked for so long.

Final Thoughts

Kovay Gardens started out looking like a pleasant, ordinary timeshare resort and ultimately revealed itself to be the center of one of the most serious timeshare-related scandals in recent memory. Its downfall serves as a stark reminder of how critical transparency and accountability are in this industry.

No one expects to find themselves tied to a property later implicated in international fraud investigations. But stories like this prove why owners must stay informed, remain cautious, and seek professional guidance when something about their timeshare doesn’t sit right.