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Attorney General Lockyer Targets Travel-Related Fraud that Ruin "Dream Vacations"
Part of "Operation Trip Trap," joint state-federal campaign to fight abuse in travel sales
Attorney General Bill Lockyer today announced the filing of five consumer protection lawsuits that are part of "Operation Trip Trap," a joint federal-multi-state law enforcement and education campaign to combat travel-related fraud.
In California, a lawsuit was filed Monday in Orange County Superior Court against Island Tours, Inc., of Fountain Valley, Calif., and Surf & Sun Tours, Inc., of Phoenix, Ariz., for alleged false and misleading promotions of Mexico and Carribean spring break vacations. The companies directed the promotion of Mexico and Caribbean discount travel packages at college students through campus and Internet advertisements.
Another consumer protection lawsuit was filed the same day in Los Angeles Superior Court against Florida-based Dream Marketing, for allegedly using unsolicited faxes and false and misleading advertising to sell expensive time shares or higher-cost travel packages. The special vacation packages were promoted through faxed advertisements to California business offices.
The three other lawsuits involved National Travel Services, Inc., Uncle Gimpy's International and Modern Pilgrimages for misrepresenting vacation packages that overstated amenities to be provided, contained hidden extra charges or charged for services never received by consumers.
"We are bringing action to combat false and misleading practices of unscrupulous travel companies who are preying on consumers," Lockyer said. "The abuses involve defrauding vacationers through misrepresentation, hidden costs, charges for services not provided, or the failure to disclose restrictions on travel. By taking advantage of students and consumers who used their hard-earned money for a memorable vacation, these companies have crossed the line."
The five lawsuits are part of a 19-state campaign operated jointly with the Federal Trade Commission. The Federal Trade Commission announced the campaign from Washington today.
"Travelers should receive the vacation packages advertised without hidden costs, and be able to collect timely refunds if travel plans change," Lockyer said. "Consumers should be wary of 'great deals,' resist high-pressure sales tactics, and not shy away from asking travel agents for details of any so-called dream vacation to avoid becoming a victim of travel-related fraud."
The lawsuit against Island Tours, Inc., and Surf & Sun Tours, Inc., seeks an injunction, restitution and penalties of at least $50,000, and alleges more than a dozen violations that harmed students who sought to take a spring recess in Cancun, Mexico, or the Caribbean. The companies allegedly misled some students by shortening their vacations when flight departures were delayed by up to three days. The students also were faced with the threatened loss of their rooms or no hotel accommodations when they failed to show up on the first day of the reservation or had to seek unexpected extensions when their return flights failed to leave until days later.
Among other things, the company allegedly failed to issue tickets or vouchers in a timely manner, failed to refund money paid for serviced not performed; failed to provide customers with flight information prior to departure; improperly changed departures from one airport to another; provided hotel accommodations which were downgraded or of a lesser quality than represented to customers; charged more for flight arrangements and/or hotel accommodations than contracted with the passenger; and provided a meal package that was not honored by all of the participating eateries represented in its vacation package.
Additionally, Island Tours, Inc., promised trip cancellation coverage for $29, but failed to disclose that the policy excluded failure of the company to provide the agreed-upon travel arrangements. The exclusion was cited by the travel company's insurer in denying claims for trip cancellations.
The complaint against Dream Marketing of Winter Park, Florida, alleges the company sold vacation packages with hidden charges such as transfer and handling fees; failed to provide transportation in the package so customers had to pay more to even use their purchased vacation plans; and was operating in California without registering as a seller of travel. Investigators found that Dream Marketing also hid company fees for cruise reservations and processing transactions by quoting government and port charges at $148, when the real charges were only $94.
While travel agents promoted vacations as having no restrictions, some hotel packages required vacationers to hear sales pitches for time shares and the cruise packages carried numerous restrictions on availability, selection of vacation dates, and advance notice needed to activate use. The company also claimed a customer's unused package could be carried over for 12 months at no extra charge, when in fact there was a charge and the extension was possible only with approval of the cruise company. The lawsuit seeks an injunction, restitution and penalties of at least $50,000, alleges more than a dozen violations for customers who responded to the advertisements faxed to business offices in California.
State law requires all sellers of travel to register as travel agents with the Attorney General's Office. Travel agents must place all passenger payments into a client trust account until tickets are actually purchased from airlines or cruise companies. Travel agents also must deliver travel tickets to clients within 72 hours of payment in full. Federal law further prohibits the sending interstate of unsolicited advertisements via facsimile machines.
The earlier lawsuits involve:
National Travel Services, a Florida based company which used Robin Leach in its "pack your bags" promotions. The company was sued in Marin County for false and misleading practices that implied a recipient won a free vacation. Consumers who committed to the trip discovered they would have to participate in a time share sales seminar and faced previously undisclosed fees. Investigators found the company also failed to give the required notice that consumers have the right to cancel in three days.
Uncle Gimpy's International of San Diego, which was sued in Los Angeles Superior Court after some 400 prepaid reservations purchased by college students for spring vacations were canceled and some 100 American college students were stranded in Mexico. Some students who purchased vacation packages from the company found themselves packed into overcrowded hotel rooms, while others were without their contracted accommodations, services or transportation. The company also was charged in June with being an unlicenced seller of travel and failing to provide refunds or timely refunds.
Modern Pilgrimage and its major principal, Manfred Reinhard in Orange County Superior Court, which was found to have never paid suppliers for the travel arrangements purchased by some 400 customers. The state in May obtained a judgment for more than $600,000 in restitution and penalties. The case alleged that the now-defunct company delayed tours until it could divert money from the sales of more trips.