Sudden Closure Notice Amid Travel Agency's Financial Struggles
Refunds for Airfare and Hotel Fees Used for Operating Costs
Victims Demand Refunds, Plan Legal Action
Notice of planned closure posted on the A Travel Agency website on the 15th. [Image source=Captured from A Travel Agency website]
[Asia Economy Reporter Lee Jung-yoon] "Gyeonggi Province is struggling, but I’m about to lose 5 million won. I understand their difficulties, but this money is like blood to us newlyweds..."
Jung Mo (34), who got married this July, had a hard time holding the wedding due to the COVID-19 pandemic, and now the deposit for the honeymoon is raising his stress levels again. About nine months before the wedding, in October last year, he booked a 7.7 million won travel package with travel agency A. Planning to honeymoon in Cancun, Mexico, he gave up the plan as overseas travel became difficult this year. He requested a refund from travel agency A, but the agency, struggling financially due to COVID-19, returned only about 2 million won and said the rest would be paid later. However, the agency recently decided to close down, unable to withstand the financial difficulties.
Jung is not the only one affected by travel agency A. B (31) also booked a US and Mexico travel package last July and paid 7.5 million won. He has only received about 1 million won back. Most of the victims are newlywed couples who planned overseas trips, according to the nature of the travel packages. About 130 such newlywed couples have even formed a group chat on KakaoTalk to seek ways to respond. Including those not participating in the chat, the estimated number of affected newlywed couples is about 300 pairs. The amount lost ranges from 1 million to 10 million won per couple.
Travel agency A plans to use insurance money received upon closure to refund customers, but the total insurance payout is only 240 million won, making full refunds difficult. Victim Yoo Mo (26, female) said, "I didn’t even receive direct contact from the company about the closure and found out by checking their website," adding, "I understand the travel industry has been hit hard by COVID-19, but they still should return the money."
Meanwhile, there are claims that travel agency A, after receiving refund requests, reclaimed costs paid to airlines and hotels but used the money for company operating expenses instead of returning it to customers. Because of this, some victims are preparing legal action against the agency. Victim C (30) said, "Currently, 28 people have expressed their intention to participate in criminal complaints." In response, Jeon Mo, CEO of travel agency A, said, "We did not anticipate the prolonged duration of COVID-19 and used deposits and similar funds for operations due to liquidity issues, trying to hold on. We will do our best to ensure affected customers receive compensation."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
