AGENTS have taken to
Travelinfo’s OpenJaw
Facebook group,
saying they feel betrayed,
with some threatening
to open cases of fraud
against United Europe.
On Friday, June 21,
sources alerted TNW that
United Europe’s phone
lines had been shut down
with a message on the
company’s answering
machine stating that it
had ceased trading with
immediate effect. TNW was
told the company had been
taking money and bookings
until as late as 12h00 that
afternoon.
In a release issued by
the tour operator over the
weekend, md, Mark Buck,
blamed the company’s
closure on internal fraud
amounting to multiple
millions of rands as well
as poor market conditions.
However, agents on
OpenJaw allege that the
internal fraud took place
more than two years ago
and that United Europe
continued to operate
recklessly, rolling cash to
fund operations.
Over the course of the
week, enraged agents with
out-of-pocket clients took
to Facebook, commenting
that the directors had
breached their fiduciary
duties to the company.
Marthinus Strydom, ceo
of Exotic Vacations, says
he has opened a case
against United Europe,
its shareholders and
directors.
He says he also intends
to legally oppose a
voluntary liquidation of
UE, saying that a forced
liquidation – where
liquidators are appointed
by the claimants rather
than the company
shareholders – would
result in a more favourable
outcome for out-of-pocket
agents and clients.
The company had said
that it would go into
voluntary liquidation
and that the name of
the liquidator would be
released in the coming
days.
“I cannot understand why
the practice of operators
‘rolling cash’ – where
money that is intended to
be used towards supplier
payments is instead used
to fund operations – is
allowed to continue. These
irresponsible operators
are the real enemies of
the trade, as they push
consumers away from us
toward international OTAs,
believing that risk lies with
the travel intermediaries,”
says Marthinus.
United Europe has set
up a helpline, asking
agents to contact help@
unitedeurope.co.za with
queries.
Insurance
Bryte Travel Insurance
says its policies do
cover insolvency of travel
wholesalers. Anreith
Symon, head of travel
for Bryte Insurance
Company, says travellers
who purchased insurance
prior to June 20, which
specifically includes
the “insolvency of your
travel supplier or travel
wholesaler” benefit, may
complete and submit a
claim form for assessment.
“For travellers who
qualify for this benefit,
if the insured journey is
cancelled before the
start date, Bryte will
refund the portion of
the loss that will not be
reimbursed by the travel
supplier or wholesaler.
Alternatively, if the
insured journey is
cut short due to the
insolvency of a travel
supplier or wholesaler,
we will refund the
additional costs incurred
to return to South Africa.
Specific terms,
conditions and
exclusions do however
apply to this cover.
These are outlined in
our policy wording,” says
Anreith.
TIC and Hollard
Insurance do not cover
tour operator insolvency.
Industry rallies
Members of the travel
industry have rallied
to assist agents and
clients affected by
the closure of United
Europe.
Wally Gaynor, md of
Club Travel Group, says
he will personally cover
the costs involved with
all clients that have
impending United Europe
reservations or are
currently travelling and
who have booked with
Club Travel or a Club Travel
ITC. Club consultants
are requested to contact
Club Travel’s franchise
director, Jo Fraser, on the
procedure to follow.
Flight Centre Travel
Group has also announced
that it will assist
customers affected by
United Europe’s closure.
Both British T.I.P.S and
Thompsons Holidays are
assisting agents affected
by United Europe’s
closure at cost for
bookings already paid to
United Europe.
