While travel agency collapses that leave consumers stranded or out of pocket produce bad publicity for agents generally, they are particularly damaging for reputable travel companies that have similar or identical names to the ones that go bust.
One company with good reason to know is a reputable business in South Melbourne (that also has an operation in Blacktown, NSW). It is named Sky Air Services, the same name as a firm in Fremantle that collapsed last week. The two companies have no connection.
When the Fremantle business collapsed, it stranded passengers and added insult to injury by swearing at aggrieved clients on its Facebook page. See: Clients stranded and abused as another agent goes down
Sky Air Services in Melbourne has published a statement on its own Facebook page making clear it is in no way affiliated with the Fremantle agency that it shares a name with.
The statement, posted on 22 July 2015, reads:
We are receiving an increasing number of calls from people complaining that we have charged their credit cards. On further investigation we have found that it has been Sky Air Services in Fremantle that has charged their cards.
Please note that our offices in South Melbourne and Blacktown have nothing to do with the Fremantle agency which is a completely separate company.
SmartCompany, a leading Australian website for small and medium-sized enterprises (SMEs), made contact with Sky Air Services Melbourne last week and spoke to the general manager, Lidia Jelinic, who confirmed her business had nothing to do with the one in Fremantle.
“We’ve been in business for many, many years and have many clients who keep coming back to us,” she told SmartCompany.
She said the names had caused much confusion and she had been fielding “quite a few calls” from concerned customers.
Jelinic said the confusion had been a “real inconvenience” for her business. She told WA Today in Perth of receiving desperate calls from people, and abuse on Facebook.
She said there used to be a big network of Sky Air Services businesses across Australia. Her company had sold the Perth office to a woman about 20 years ago, when all connection ceased.
Jelinic has instructed her staff to give callers the details of Consumer Protection in Western Australia, and has posted the same advice on her website.
In the travel industry, as in other businesses, name confusion can erroneously link sound, reputable operators to unrelated outfits that go bust owing clients money.
Even worse, dodgy operators sometimes try to register names that are deliberately similar to those of more major, reputable firms.
Some industry observers fear that devious practices may increase now that travel agents are no longer required to be licensed, following the termination of the Travel Compensation Fund (TCF) last year.
Recently, in a front-page lead story in The Justinian, Australia’s most respected legal newsletter, long-established Melbourne lawyer and Justinian columnist, Barry Lane, questioned the effectiveness of the current self-regulatory accreditation regime (ATAS), introduced by AFTA in July 2014.
“My prediction is that all those who were excluded from the industry on fitness or financial grounds over the last 20 years, whether formerly licensed or not, will now drift back in,” Lane warned. See: Top legal newsletter exposes agent deregulation dangers.
Written by Peter Needham