Help! One Company Refused to Refund Travelers More Than $100,000

Dear Tripped Up,

My trip to Egypt with Overseas Adventure Travel was scheduled to depart in late March. O.A.T. canceled the tour because of Covid-19, which was a relief. The company notified me of the cancellation and offered either a credit for rebooking or a full refund that would have included airfare. The next week, I learned via email that I had been rebooked on the same trip next year. Unbeknown to me, the stated policy had changed: O.A.T. was no longer offering refunds. I told them that I had a medical condition and did not know when — or if — I would be able to travel, and asked whether they were just going to keep my $17,500 if I couldn’t travel by the end of 2021. Answer: Yes.

I feel I am being held hostage by O.A.T. How are they allowed to keep my money? Roz

Hi Roz,

They’re not. But, if the extraordinary number of reader complaints I have received — more than a dozen and counting — are any indication, they have been doing so anyway.

Overseas Adventure Travel is part of Grand Circle Corporation, a family of travel companies based in Boston. The small-group and cruising company has been recognized nationally.

But Massachusetts happens to be one of only a handful of states with specific laws that guarantee consumers protection against travel sellers, including requiring that tour operators offer the option of cash refunds (in addition to vouchers or credits for rebooking) when they fail to provide agreed-upon, paid-for services. According to the law, the cash refund must be “an amount equal to the fair market retail value of any undelivered, purchased travel service.”

Translation: When they cancel your trip, they are legally required to offer you the money back.

But even when individual consumers know their rights, they have few options at their immediate disposal when a customer-service representative — usually the only public-facing proxy for a company’s official or unofficial policies — refuses to relent on refunds.

As Adam Anolik, a San Francisco- based travel-industry lawyer, explained over email, that’s why oversight — forcing a company to comply with state laws — can feel like an uphill battle. “The outcome can often turn on who cancels, which is why a lot of suppliers and travelers are playing chicken right now. In reality, many of these statutes are seldom enforced. This pandemic could cause some of them to be dusted off,” said Mr. Anolik.

This is the third Tripped Up column in a row that addresses the issue of refunds. Although travel has stopped and is only starting up again — slowly and in only a few destinations — the aftershocks of that screeching halt, brought on by the coronavirus, continue to reverberate.

As travel companies now suffer a cash crunch, they are facing off with travelers over credits and refunds. Airlines are sidestepping refund regulations established by the United States Transportation Department and the European Union, betting that negative press (and even class-action lawsuits) are still preferable to negative-balance bank accounts.

It’s not hard to surmise, just by reading your email, what happened at O.A.T.: the realization that issuing refunds en masse would bleed the company dry. Tweaking the immortal words of Biggie: no money, mo’ problems.

To determine if my hunch was correct, I reached out to O.A.T. While they didn’t answer my question directly, I was able to recoup more than $100,000, collectively, for you and 10 other readers. Some got total refunds, while others (including you) received partial refunds or continue to wait for certain fees and sums to clear.

In an emailed statement, an O.A.T. spokeswoman said the company is “working to improve our processes and to better address the needs of each traveler whose trip was canceled or postponed due to the pandemic. We are either rebooking travelers on another trip or providing a refund.” Since mid-March, she said, O.A.T. has refunded more than 5,000 travelers — amounting to more than $12 million.

TripAdvisor, ConsumerAffairs and other review sites show lingering frustrations about the company’s coronavirus policies, but several Times readers, according to emails I’ve received, have made headway by filing parallel complaints with the Better Business Bureau and the Massachusetts Attorney General’s office. That agency said that it has received about 275 consumer complaints so far about canceled O.A.T. trips and has been pressuring the company to comply with the state’s travel-seller laws.

Other travelers looking for refunds may have a better chance if they’re dealing with companies headquartered within Hawaii, Washington state, Illinois or California. In Hawaii, consumers have the right to a cash refund (minus previously disclosed cancellation fees) within two weeks of requesting one. Washington requires travel companies to issue cash refunds within 14 days (or 30 days when the funds are already paid to a vendor, as might be the case for a tour operator) when they cancel a service. In Illinois, the Travel Promotion Consumer Protection Act was created in the 1980s to safeguard against travel scams that promise too-good-to-be-true deals. California, with some of the strongest consumer protections in the country, requires cash refunds for undelivered services within 30 days from whichever date is earliest: the scheduled departure date, the date the refund is requested or the date the service was canceled by the travel company. (Mr. Anolik has a detailed breakdown of other state-by-state travel laws on his firm’s website.)

Back to O. A. T.: In a follow-up note a few weeks ago, you said that you feel the company provides a “good travel service.” But, you wrote, “pushing all the risk of uncertainty onto the client by refusing a refund makes me fearful to ever do business with O.A.T. again.”

You raise an important point. Even though people can’t travel right now, many of us are continuing to dream about our next trip — and that means making conscious and subconscious decisions about which companies to spend money with once the pandemic has passed.