It’s time for the government to regulate this sector
Auckland, January 9, 2020
An Auckland based travel agency has gone bust, leaving scores of passengers in the lurch after allegedly collecting money and issuing bogus tickets.
It is time that the government put in place a legislation to protect the hard-earned money of ordinary New Zealanders and make travel agents liable to their clients. It is unfortunate that airline companies are able to absolve themselves of any responsibility and Travel Agents’ Association of New Zealand (TAANZ) does not extend its jurisdiction to agents who are not its members.
Customers in the dark
Auckland based Guru Travel Limited went into liquidation on November 21, 2019 but a majority of its customers were not given any notice by the company or by Shareen Ramasre, listed as a Director of the company in the Companies Office Register.
A Gazette notification issued on November 22, 2019 said that Guru Travel was placed into liquidation by a special resolution of its shareholders held on November 21, 2019.
Gareth Russel Hoole and Clive Robert Bish, Chartered Accountants and Chartered Accountants Australia New Zealand Accredited Insolvency Practitioners (New Zealand) have been appointed joint and several liquidators pursuant to section 241(2)(a) of the Companies Act 1993.
The Gazette notification gave notice to creditors to prove their debts or claim by December 21, 2019. It is not known whether any passengers have filed their claims.
Debts not secured
Indian Newslink understands that monies paid by travellers are likely to constitute secured debts and hence will not be prioritised in settlement of any cash left with the defunct company after disbursals and during the liquidation proceedings.
A Wellington-based reader contacted us on Tuesday (December 7, 2020)saying that she had booked two tickets with Guru Travel on November 4, 2019 for travel by Jet Air from Wellington to Auckland on January 25, 2020 and from Auckland to Chennai by Malaysian Airlines on January 26, 2020. Return tickets were booked for travel from Chennai on February 25, 2020.
“I paid $2380 to Guru Travel’s bank account on the same day through internet banking. I had saved this money for the past one year. My son and I were very excited at the prospect of meeting my parents and the extended family in Chennai,” she said.
She received a rude shock on January 2, 2020 when she contacted the person at Guru Travel (apparently on his mobile) through who she had booked the tickets to confirm her meal preference.
That was when she was informed that the company had gone into liquidation.
A Malaysian Airlines official told her that she and her son were not on their passenger list, even though the woman had the tickets with ‘Confirmed’ status indicating that payment has been made.
“The following day (January 3, 2020) I went to the Police Station to file a complaint of fraud but I was misinformed that this complaint should be taken to the Disputes Tribunal. However, they gave me the contact details of the liquidators but there was no response (apparently because of the holiday season). I also went to the Citizens Advisory Bureau to seek the advise of a legal counsel but the service will be resumed only on January 13, 2020,” she said.
The Panworld Travel case
Six years ago, there were several such victims when Panworld Travel Limited went into liquidation (on February 4, 2014). Many customers of the company had complained of tickets (purchased and paid for by them) not being honoured by airlines at the airport and double or triple debits of credit cards for the same purchase.
TAANZ had addressed the issue since Panworld Travel Limited was a member and had obtained revalidation of tickets or refund of monies from the concerned airlines for many customers.
Later, the Police led an inquiry with the support of the Serious Fraud Office (SFO) and filed a case against Mr Amin.
According to a SFO Report, Mr Amin was sentenced to three years’ two months imprisonment in June 2017 plus $105,000 reparation, “following a joint 18-month investigation into alleged credit card fraud while he was the owner of a travel agency in Mangere trading as Panworld Travel.”
The Report also said, “Mr Amin defrauded airlines, event organisers and individuals of almost $1 million of flight-related travel. Police led the enquiry, while the SFO participated in the search warrant process and assisted with forensic accounting.”
Need for a tough law
While the Reserve Bank of India and the Financial Markets Authority constantly monitor the compliance of banks and insurance companies, the Coalition government has introduced laws protecting consumers against businesses breaching guarantees and supply agreements.
The Commerce Commission also disciplines erring companies and its directors.
There is now a pronounced need to protect ordinary New Zealanders against defaulting travel agents. As the volume of travel increases with various airlines offering incentives and rewards along with the desire to explore new destinations, there will also be rising risk of fraud and bankruptcy.
We hope that the government will act soon.