March 17, 2004 -- There are good ways and bad ways to go out of business.
This month, the bad way was illustrated by Scottsdale, Arizona-based Discover Wholesale Travel, also known as Aus-Vacations. A few years ago, they were a major (and reliable) agency dealing mostly with trips to Australia, New Zealand and the South Pacific.
At the beginning of March, though, they simply went poof. When we called on Tuesday, not even the Better Business Bureau could find them -- though the BBB says they'll have some sort of report online soon at www.phoenix.bbb.org.
Discover Wholesale's Web sites are shut down, and their phone numbers are disconnected. The home number of the company's general manager is disconnected; the company president has an unlisted number. We're not even sure they're technically bankrupt -- there's no case in the Arizona bankruptcy court system with either company name, and they're still listed as an active corporation by the state.
The Australian Tourist Commission told us they haven't done business with Discover in a year, declining to tell us why. Air Tahiti Nui also said they don't do business with Discover any more. If you check out bulletin board postings such as these (www.tahitinuitravel.com/forum/default.asp?r=12&s=3078), you'll see hints that Discover has had financial troubles for a while.
One thing's sure: they've left a lot of travelers in the lurch. A recent Washington Post story (www.washingtonpost.com/wp-dyn/articles/A51970-2004Mar11.html; a free registration is required to read the article) tells the tale of a school choir whose $120,000 in tickets to Australia vanished along with Discover. According to the Post story, the agency vanished around March 5.
We still have a few long-shot calls out to possible employees of Discover, and if we get the real scoop we'll pass it along to you. In the mean time, here's what to do if you've been stranded -- or if you don't want to get stranded by a failed agency in the future.
If you used a credit card to book your trip and haven't yet received your airline tickets, you're almost certainly protected. Call your credit card issuer, explain that your travel agency has gone under and reverse the charge.
If you bought trip insurance, you should be covered as well. Agency failures like these are an excellent reason to buy independent travel insurance that isn't sold by your agency. Go instead to reputable insurers like Access America, Travel Guard and other companies we recommend here: .
If you have your ticket, don't have travel insurance and are holding worthless hotel vouchers, you may be out of luck and may have to pay for hotels again. When you hand over money to a travel agent for an air-and-hotel trip, follow up by calling your hotels to make sure your reservation is both made and paid for. If it isn't, take the issue up with the travel agent before you leave the USA.
Your last resort would be to go to court against Discover and its owners, Kim E. Ansell and William Anderson. Your chances for getting your money back would be pretty slim -- even if the law can find the misbehaving travel agents, you'd be in line behind the hotels and airlines stiffed by Discover. If that's your route of choice, though, stay updated by checking back on the Phoenix BBB Web site at www.phoenix.bbb.org/commonreport.html?bureau=phoenix&compid=15004922&code= for their latest reports on the legal status of the company.
Do you have a question or comment on this column? Were you left in the lurch by Discover Wholesale Travel? We want to hear from you on our Message Boards.