AFTA update 29 Aug 17

AFTA update 29 Aug 17

FROM AFTA’s chief executive, Jayson Westbury

The collapse of the Reed Holiday group last week has no doubt come as both a surprise and disappointment to AFTA and the broader industry as there was no indications or early warning signs that had been presented in any way through the process of the ATAS accreditation. In fact, if anything the company had a good trading record and long history. So to all of a sudden, without warning go belly up is a mystery that will now need some forensic investigations.

The liquidator who is now at the centre of this entire mess is clearly doing what they can to unwind where the money that is now clearly missing has gone, but the simple fact is, if the reports of over 1,000 passengers being impact are to be true, then one can expect that there is a great deal of money involved.

So where is the money? It is a simple question for the owners of this business, a question that neither of them appear to want to answer. Meanwhile all of these poor unsuspecting consumers and travel agents in some cases are left wondering.

While it is true that in days gone past the previous scheme arrangements may have bailed everyone out, in my view, that is simply not reasonable for the rest of the industry to have to deal with.

Something inappropriate has clearly happened in this case. For a business to be going along happily for all those years reporting profit and paying their bills to in a blink of an eye, right up to the last days, then collapse, it does not add up.

As AFTA has said in our official announcement, we are recommending to impacted customers to contact the local police and file a police report for the money. If these owners are allowed to get away with this, then that is not OK.

Over the past 2.5 years there has been no ATAS accredited agent go under. This has been an excellent record and we stand by the systems and processes we have in place. What we can’t oversee or regulate is phoenix activity by owners which in this case appears to me to be without question.

Curiously when you take a look at the insolvency record of Australian businesses, travel businesses do not even rate or report on the ASIC insolvency statistics. In the 12 months to June 2016, 6,348 Australian businesses were reported to be insolvent. This is a staggering number, and fortunately for the travel industry our comparative stat for the same period for ATAS agents was zero. It is important to keep this in balance. In addition to this statistic, of the 6,348 businesses last year, 32 were “fraud” with the main purpose of collapse being “poor strategic management of business”.

While nobody in the travel industry is happy about this collapse of Reed Holidays, most least AFTA, it is important to keep a perspective on just how amazingly well our industry does to stay in business compared to the national statistic. As a foot note, the Australian Federation of Travel Agents intends on pushing for the truth on what really happened to Reed Holidays and the principals involved.

The post AFTA update 29 Aug 17 appeared first on Travel Daily.

Source: traveldaily