Internet fraud reignites bonding issue

THE rise of online means
now, more than ever,
it’s easier for fly-by-night
OTAs to set up shop and
swindle consumers, bringing
the industry into disrepute.
Should the travel industry be
better regulated to protect the
consumer?
A consumer approached TNW
saying he had booked tickets
with a travel agency he had
found on the Internet – www.
skyblue-travel.com. The agency
appeared to be a UK-based
company with a satellite
office in Johannesburg. When
the client was asked to pay
money into a personal savings
account for his tickets, alarm
bells went off and he decided
to abort the booking.
In a matter of days, the
travel agency’s website had
shut down and telephone calls
went unanswered. Google
Street View revealed that the
supposed head office address
in the UK was a derelict house
in London. The website was
actually registered to a man
based in Durban.
Wally Gaynor, md of Club
Travel, believes the industry is
not doing enough to protect
the consumer and should look
urgently into some form of
consumer protection, be it a
bond or insurance. “Currently,
there is no financial protection
for a client booking with an
Asata agent, which I think is
crazy. I would like to see Asata
as a seal of protection in the
travel industry.
“I don’t like over-regulation
and believe in a free market
but I would like a consumer
to look at the Asata logo as
they do with ABTA in the UK
and know ‘my money is safe
with these people’. If we
don’t implement some form
of consumer protection and a
big entity defaults and leaves
clients stranded, it will result
in an outcry and could see the
government step in.”
Rod Rutter, coo of XL Travel,
says Iata and Asata act as
regulators for the SA travel
industry, as the organisations
impose codes of conduct and
perform financial checks.
Rod admits that the issue
of default insurance to protect
consumers is an area in
which the travel industry could
improve. He says the onus
should not fall solely on the
travel agent, and that the
airline industry should also
be held liable. “A lot of our
problems in the past have
been as a result of financial
difficulties by the airlines.”
Otto de Vries, ceo of Asata,
says the issue of default
insurance is one that has been
discussed for many years,
particularly when a member
of the travel sector declares
bankruptcy, leaving consumers
high and dry. “Asata is
currently debating the merits
of such a compensation fund
to seek clarity on whether this
is something that would be
suitable for the SA market.”
Otto adds, however, that
in markets similar to South
Africa’s, like Australia, default
insurance programmes are
being removed because
they have realised that the
concept of a bail-out scheme
is not the way to establish a
professional industry. There
is also the issue of support
for a compensation fund, says
Otto. “Would a company wish
to contribute to a fund that
will pay to compensate for his
competitor’s errors, fraudulent
activity or any other error?”
Otto also asks whether
establishing a compensation
fund falls within the scope of
Asata’s role. “As Asata, we
also need to look at the role
the association plays and the
tasks it takes on, on behalf
of its members. While we
recognise the need to debate
the merits of this fund with our
members, it may not be our
role to offer or provide such a
compensation fund.”