The flight ticket trap: Loophole leaves victims of failed agent waiting five months for refund

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The Independent Online
FOR FRED and Vicky Poynter, who live in Watford, last Christmas was going to be their best ever. They were going to Australia, partly to visit Mrs Poynter's family who now live in Perth, and partly for a belated honeymoon (they got married, both for the second time, last August).

Before the wedding, Mr Poynter started looking around for the best flights-only dea1 and in July he thought he had found it. A London travel agent, Leisure Communications, was advertising cheap scheduled flights to Perth, flying with Royal Brunei Airlines for pounds 1,600.

'The price was good but more important was that our money was protected if anything went wrong,' Mr Poynter said. 'We were determined we were not going to take any risks.'

That meant making sure that Leisure Communications had the three symbols the travel industry has always advised careful travellers to look out for: Abta (the Association of British Travel Agents), Atol (the Air Travel Organisers Licence, run by the Civil Aviation Authority) and Iata (the International Air Transport Association, the airlines' trade association). Leisure Communications had all three, so Fred Poynter paid over pounds 1,600.

Last October, however, Leisure Communications went into liquidation. Mr Poynter was one of 400 customers who had paid for scheduled flights on a number of different airlines but had not received their tickets.

Mr Poynter put in an immediate call to Abta, which assured him that his money was '99 per cent safe', but that it would take some time to come through. So he borrowed another pounds 1,600, and he and his new wife went on the wonderful honeymoon they had planned.

But it was rather spoilt when they returned, because their refund had not turned up. Some unexpected problems had emerged.

First, Abta had turned down the claim. This was because Leisure Communications was a 'tour operator' Abta member and not a 'travel agent' Abta member. Leisure Communications had told Abta that all the holiday flights it was offering were covered by the CAA's Atol bond, so they did not need full travel agent membership.

Abta told the Poynters to claim instead from the Atol scheme and put them in touch with the CAA. But then a second problem appeared. The Atol scheme only covers flights that are booked as part of a holiday package, not scheduled flights.

The CAA advised them to make use of Leisure Communications' Iata membership, which is intended to cover scheduled flights, and claim directly from Royal Brunei Airlines.

But Royal Brunei Airlines refused to pay up. It said it had received no money on behalf of the Poynters, had not issued them any tickets and therefore had no obligation to them. It advised Mr Poynter to go back and claim from the CAA. In turn, that body and Iata both said that Royal Brunei Airlines (and the other airlines involved) were liable, and that Mr Poynter should resubmit his claim to them.

For five months, the Poynters were passed from one organisation to another, with no one prepared to accept responsibility for their pounds 1,600. What enabled everybody to blame everyone else was a loophole in the system.

Leisure Communications had been buying discounted, scheduled airline tickets not directly from the airlines but through 'consolidators'.

These agents operate a kind of shadow market that allows airlines and wholesalers to make money on seats they cannot sell through the conventional channels. The buying and selling of airline tickets through consolidators falls between the Iata and the Atol schemes.

It is not clear whether these discounted tickets count as proper scheduled tickets or whether they count as holiday charter tickets.

The CAA and Iata tried to persuade the airlines involved to pay back Leisure Communications customers under the Iata agreement.

The airlines, in turn, said it was up to the CAA, as the regulatory body for air travel in the UK, to sort it out.

In mid-March the CAA gave in, deciding, after all, that it could use its discretion to pay Leisure Communications customers out of the Atol scheme.

So after five months of considerable worry, Mr and Mrs Poynter, along with all the other Leisure Communications customers, should receive their refunds.

Last week the CAA indicated that it would soon amend the regulations to remove the loophole and force all travel agents that deal in discounted tickets to cover those tickets through Atol.

In the meantime, there is no need to avoid buying cheap, scheduled tickets through unorthodox channels, but it is wise to follow a few simple rules.

Try to pay by credit card as the credit card will be jointly liable for your money if the travel agent fails.

If you do not want to do this, either insist on handing over your money only when you actually receive the tickets or only buy the tickets through an agent that has travel agent membership of Abta.

David Berry works for BBC TV's 'Watchdog'.

(Photograph omitted)