Can't Pay with Plastic?

In our January report on the sudden closure of Tropical Adventures (TA) and its sister dive travel companies, we suggested that divers prepay their trips with credit cards rather than checks, as an extra level of safety. You see, the divers who paid by check had no recourse whatsoever. And while paying by credit card is not foolproof, those who used a card did have recourse through their credit card companies, and some were able to cancel charges.

First, travel services are not covered under card “purchase protection plans,” which generally insure cardholders only for damaged or stolen goods. The only recourse a cardholder has is to dispute charges for travel services that aren’t delivered, such as when a wholesaler like TA suddenly goes bust. Nancy Muller, vice president of public affairs for American Express, told Undercurrent that when you pay with an Amex charge or credit card you are protected if the seller fails to provide the service. Amex will reimburse you even if it is unable to collect from the seller. That’s generally true of Visa and MasterCard, although there are some gray areas since these cards are issued by various banks, each with its own policies. Here’s a case in point.

IDE and Solmar spat, while divers get screwed

Harry Kreigh (Sacramento, Calif.) arrived in Cabo San Lucas, Mexico last November, ready for a week of diving aboard the Solmar V. He had prepaid his trip through International Diving Expeditions (IDE) of Rancho Murietta, so he was stunned when a Solmar crew member demanded an additional $300 from him and each of his companions before the departure.

Unbeknown to Kreigh and his three dive buddies, there was a dispute between IDE and Solmar over an alleged cancellation fee ($1265) for other spaces on their trip. The folks at Solmar, unable to collect what they thought was owed them by IDE, put the finger on innocent folks, demanding that Kreigh and his friends pony up the disputed amount before they would get underway.

Faced with being stranded on the dock a thousand miles from home, they agreed. Kriegh plunked down his DAN MasterCard and went on to enjoy his trip, particularly the service of the friendly staff. But when he got home, he contacted IDE owner Nadav Joshua about the surcharge. Joshua maintained that he had canceled the unfilled spots on the trip well in advance, and that the Solmar had no right to a cancellation fee. But the Solmar folks stuck to their guns, and neither Joshua nor they were willing to refund the surcharges, so Kreigh filed a dispute with MBNA America, the bank that had issued his MasterCard.

After some correspondence back and forth, including documentation supplied by Joshua, MBNA eventually issued Kreigh a credit for the entire surcharge. Case closed for Kreigh, but not for his buddies. One of them, Abe Weitzberg of Potomac, Md., filed a dispute with his MasterCard issuer, Citibank, and got turned down. Citibank explained that the company couldn’t do anything unless Solmar agreed to reverse the charges. Same situation, two interpretations. Abe Weitzberg is still negotiating with Solmar’s U.S. representative for a one hundred percent refund. The other divers in Kreigh’s party accepted a counter- proposal from Solmar: a credit of $575 per person on a future trip, provided they book directly, not through IDE.

As Kreigh puts it, “This incident, which was a consequence of unprofessional business practices by both the travel agent and dive operator, is a deplorable example of diver victimization and demonstrates a total disregard for client welfare.” Undercurrent agrees. There are plenty of responsible travel agents and operators out there from which to choose. So why do business with outfits like these that play fast and loose with your money?

Kreigh’s success at getting his charge reversed is probably an unusual stroke of good luck. Generally, if you sign a charge slip and the service is delivered, your chances of later disputing the charge are a crap shoot, at best. Your odds might be better if you have a long and solid credit card history. More than once, we’ve heard of card issuers giving special consideration to good customers with substantial relationships.

No credit cards, no thanks

Most travel sellers accept credit cards, and the list is growing in the nervous travel environment following the Tropical Adventures collapse. Riding Rock Inn on San Salvador in the Bahamas currently accepts credit cards for purchases made on the island, but demands payment by check for advance reservations through its Fort Lauderdale booking office. However, a reservation agent there told us that the Inn has submitted an application to a card-issuing bank, and plans to begin accepting plastic for U.S. reservations in the near future.

Jenny Collister of Reef & Rainforest travel agency also used to have a “checks only” policy, because she didn’t want to pay three percent to credit card companies out of what she sees as narrow profit margins in the dive travel field. But now, she says that rather than lose a booking from a jittery client, she’ll take a credit card if she’s dealing with carriers, resorts, or dive operators she’s comfortable with. She figures that building good customer relations will make up for the reduced income over time.

As for me, I’m suspicious of any travel company that doesn’t accept a credit card in the twentyfirst century. That sends me a signal I don’t like. So, if I’m told I must use a personal check, I make other arrangements. The diving world is full of options, and I just find another, knowing that I, at least, have some recourse if they flake out.

---- Ben Davison