Travel firm may have $lm debts

Press, Volume CXII, Issue 32975, 22 July 1972, Page 2

Travel firm may have $lm debts

(N.Z.P.A.-Reuter —Copyright)

MELBOURNE, July 21.

A co-founder of the collapsed Travel House of Australia has said that the company had debts of about $1 million and 3000 to 4000 “grounded” travellers.

Mr D. Hagers said yesterday that he had formed Travel House of Australia in 1970, in a partnership with Mr James Todesco.

Mr Hagers severed his connection with the company a year ago. Detectives want to interview Mr Todesco, who has been variously reported in Europe, London, and Melbourne as they believe he holds information vital to their investigation of the collapse. The Melbourne-based travel company, which offered cheap air and sea trips between Australia and London, via Singapore, closed all its offices early this week. Some 300 Australians, Travel House clients, were stranded in Singapore when the company’s air-sea connections failed to materialise. They are now being given

Government assistance to get home.

Mr Hagers, who is now running an independent travel agency, said that during Travel House’s peak, it had a turn-over of $lOO,OOO a week, and could have been as big as the British travel group, Thomas Cook. “In 1970 we started with almost nothing—a few hundred dollars—and built up a boom business of 500 bookings a week. We opened 15 offices in all capital cities of Australia,” he said. "Part of the problem was that it just grew too fast. We started to run into trouble about the middle of last year,” Mr Hagers said. He decided to leave Travel House when the company moved to charter the liner Kota Singupura for the PerthSingapore run. "It -was going to cost something like $lOO,OOO a month. We knew nothing about shipping, and I could see where it was going to lead,” Mr Hagers said. He agreed to sell his shares in the company for $33,000. Records show that he ceased to be a director on November 1.

The stranding of about 400 tourists in Singapore while they were travelling on cutprice sea and air charter trips emphasised the need for the public to make certain they were dealing with reputable travel agents, the national secretary of the Travel Agents’ Association of New Zealand (Mr M, F. Foate) said in Christchurch yesterday. “It is also most important to ensure that flights are booked on airline services which can be relied on,” he said.

Mr Foate was referring to a report in “The Press” on Thursday about the tourists’ plight after the company with which they had made their travel arrangements (Travel House of Australia) had gone into liquidation. He said that reduced ah fares were available on services run by recognised airlines which offered regular, scheduled services.

“Since the beginning of this year there have been several instances of travellers being stranded, or being unable to obtain tickets already paid for, where they had gone to an agent marketing cheap-rate charter travel.

"Members of the Travel Agents’ Association are concerned at the impression which is being made on the public by a series of defaults and defalcations,” said Mr Foate.

“We ask the public to remember that membership of the association is a guaran-

tee of competence and integrity. All full members of the association are required to join a fidelity bond, arranged by the association, to protect the public against any loss resulting from defalcation of any member up to $20,000 for transport and for

“We can only emphasise to the public that the travel industry has set up its own standards and requirements. One major aspect of this is the investigation of every travel agency which seeks airline agency approval. "We would urge all intending passengers to deal with a bonded or accredited agent,” said Mr Foate.