Tour package scams by errant travel operators fast becoming a public menace

14 July, 2014

By Zairil Khir Johari, Bukit Bendera MP

zairil khir johariOf late, tour package scams by irresponsible travel operators are fast becoming a public menace. In most cases, would-be holidaymakers or those seeking to perform the umrah pilgrimage would fall victim to errant travel operators who abscond after collecting a deposit or often the full amount for tour packages.

While some cases involve freelance or unlicensed travel agents, there are also many reports of licensed travel operators failing to fulfil their promises, even after customers have paid in full. In fact, such scams have occurred even to tour packages purchased at the annual Malaysian Association for Tour and Travel Agents (MATTA) fair.

Lohas Premium

One example is the case of Lohas Premium Travel and Lifestyle Sdn Bhd (also operating as Lohas Premium Holidays Sdn Bhd and Lohas Premium Vacation Sdn Bhd). According to a news report on 1 May 2014, the operator failed to honour tour packages to Cambodia purchased by a group of senior citizens.

After paying RM4,995 initially and then an additional RM4,050 fee for insurance, luggage fees and tips, the trip had been cancelled two weeks before the departure date. The senior citizens sought a refund but were given a run around. Following press coverage of their plight, Lohas Premium finally came through with a refund.

However, there remains other pending cases, including one that has been brought to my attention. A couple from Penang, Cynthia Lim and her husband Phua Tat Teik, had purchased a Cambodian tour package from Lohas Premium in October last year, and to date has yet to receive a refund despite the trip being cancelled in April. The chronology is as follows:

28 Oct 2013 Purchased Cambodian tour package voucher from Lohas Premium through Groupon for RM999. Scheduled tour dates from 22–26 April 2014.
11 Jan 2014 Paid an additional RM786 fee to Lohas Premium for airport tax, luggage fees, meals, tips and other miscellaneous items.
2 Apr 2014 Submitted cancellation and refund claim upon finding out the tour was cancelled.
10 Apr 2014 Lohas Premium promised refund within a month.
12 Apr 2014 Groupon refunded RM999. Remaining RM786 owed by Lohas Premium still pending.
2 May 2014 Informed by Lohas Premium that refund cheque could not be issued yet as there was no signatory.
30 May 2014 Still no refund, informed to wait until 6 June 2014.
7 June 2014 Lohas Premium offered different tour packages instead of a refund. Offer declined.
5 July 2014 Lohas Premium provided a “refund number,” and repeated offer of a different tour package instead.
13 July 2014 Email from Lohas Premium informing that their company is under investigation and unable to conduct travel business.

 

It is now mid-July and the couple has yet to receive their refund of RM786. In addition, they also bought return flight tickets from Penang to Kuala Lumpur in order to connect with the original tour to Cambodia. They are currently in the process of seeking a refund from the airline.

Not enough being done to curb errant travel operators

It is urged that Lohas Premium would take immediate steps to issue a refund not only to Cynthia and Phua, but also other customers with outstanding complaints. According to a 13 May 2014 news report, comments on Lohas Premium’s Facebook page revealed many other disgruntled customers seeking refunds. These comments have since been removed.

According to another news report on 12 June 2014, the travel operator is now under investigation and has been given an ultimatum by MATTA to submit a written report, failing which necessary action would be taken by the Ministry of Tourism and Culture (Motour).

Unfortunately, a current check with Motour reveals that action has yet to be taken on Lohas Premium. What’s more, Motour officials have confirmed that Lohas Premium Travel and Lifestyle Sdn Bhd is not officially licensed by the ministry. In fact, out of the three companies owned by the same directors (see attachment), only Lohas Premium Vacation Sdn Bhd holds a valid license.

This raises a few curious questions. Firstly, how can the operator advertise tour packages as Lohas Premium Travel and Lifestyle Sdn Bhd on its official website, and Lohas Premium Holidays on Groupon (see attachment), when it is licensed as Lohas Premium Vacation Sdn Bhd (it must be noted that receipts are actually issued under the name of the licensed company)?

Secondly, is Motour able to take action on Lohas Premium Travel and Lifestyle Sdn Bhd, when the Tourism Industry Act 1992 only allows the ministry to fine or revoke the license of registered travel operators? Technically, Lohas Premium Travel and Lifestyle Sdn Bhd does not even exist in Motour’s registry.

Thirdly, even if action is taken on Lohas Premium Travel and Lifestyle Sdn Bhd, as promised by MATTA, will there be any affect on the other two sister companies? In particular, would it affect the license that is registered under Lohas Premium Vacation Sdn Bhd?

This is relevant because there have been numerous cases of irresponsible operators who continue to operate using different company names. Is this a way of circumventing the system?

It is clear that existing regulations are inadequate both in deterring and resolving cases of cheating by errant travel operators. There is therefore an urgent need to review the existing framework governing travel operators in order to find a way to curb this public menace.

This article was written by on Monday, July 14, 2014 at 6:25 pm. You can follow any responses to this entry through the RSS feed. You can leave a response, or trackback from your own site.

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