Keep us posted on that refund

American European Travel’s nine-day ancient Turkey tour looked like the perfect birthday gift for David Olson’s wife, Barbara. With stops in Istanbul, Ephesus and Pamukkale, it fulfilled a lifelong dream of visiting the old Ottoman Empire.

The Olsons learned about the trip through a brochure in The Washington Post. The AET insert bore the newspaper’s logo, so they assumed that The Post endorsed the tour and would stand behind it if something went wrong.

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And then, something went wrong.

Just a few days before their departure, the couple received an apologetic e-mail from the tour operator, explaining that it had encountered “unexpected software problems” that had caused it to overbook flights with its preferred airline. Their Turkey trip had been canceled. AET offered them a new tour or a full refund — a refund that, in their case and several others, took far longer than expected to arrive.

This incident and others like it underscore the importance of researching a tour before booking and knowing who will help if things go sideways, as they sometimes do.

A cursory online search might have sent up a few red flags. The Better Business Bureau says that it’s reviewing AET’s rating after receiving “numerous complaints.” A lengthy thread on the online review site TripAdvisor, where some of the content had mysteriously been deleted, might have raised eyebrows. And a posting on a popular forum for frequent fliers from 2012 asked, “Is this a scam?”

Ala German, an AET spokeswoman, said that the company exercises “no influence” over its online reviews. “We totally understand that a customer who is unsatisfied about a situation starts working on a way to be heard,” she added. But she pointed out that there were also many positive comments about the company.

Newspaper inserts such as the ones that Olson and others saw are the product of an advertising relationship. A company such as AET independently publishes a brochure, which includes the newspaper’s logo. In exchange for each lead generated by the flyer, an advertiser typically pays the newspaper a referral fee. But generally, publications don’t vet these advertisers, nor do they vouch for their products.

When AET customers requested a refund and the money failed to appear, despite repeated assurances from the tour operator that it would, no one should have been surprised that customers like the Olsons began phoning The Washington Post to inquire about their missing money.

Barbara Olson, a retired nursing professor from Waldorf, Md., says that she first made “numerous calls” to AET. “I was told that my refund was a priority,” she said. But almost two months had already gone by, and AET still had her $1,468.

AET’s German admitted that some of the refunds had hit a snag, but the company was trying to fix the problem, she said. The issue, she said, was that it was working with a new credit card processor. While a simple refund to a credit card could be handled quickly, if people wanted refunds by check or cash, that needed to be processed manually through a wire transfer or PayPal, which was taking time.

“The majority of affected customers have received the full refund,” she said.

But not Sheri Herbert, who had planned to take the same trip to Turkey with her husband, Frank. The retired couple from Cambridge, Md., had been waiting weeks for their $2,566 refund, and the back-and-forth between AET and the Herberts, documented in a series of e-mails, was becoming maddening. The company would promise an expeditious refund, but the money wouldn’t show up, leading to another series of increasingly frustrating exchanges.

Oddly, while these delays may seem lengthy, they aren’t unusual. Although most travel refunds take place within a week, it’s not uncommon to wait four to six weeks to get your money back. In some extreme cases, when multiple companies are involved, customers have been on “hold” a year or longer. While it’s possible to take a shortcut by disputing the charge on a credit card bill with the credit card company, that choice isn’t available to someone who paid by check or wired money. The only other option is to apply pressure — lots of pressure.

That’s exactly what the Herberts did, in e-mail after e-mail. Their tour had been canceled Nov. 2, and when they contacted me in late December, they’d been going back and forth with AET for close to two months.

And they weren’t alone. Several other Washington Post readers had called about AET, complaining of difficulties they’d experienced while booking the tours, which included not receiving confirmations when they expected them and slow refunds for canceled tours. The cases closely paralleled another set of AET complaints that the Chicago Tribune’s consumer advocate, Jon Yates, investigated in late November. Yates was able to secure a refund for most of the travelers. The Tribune also terminated its advertising relationship with AET.

I contacted AET on behalf of the Herberts and the Olsons in late December. In early January, the company responded that it had refunded both customers’ payments.

But as it turned out, only one refund had reached its intended target. AET had sent the Herberts’ money to the incorrect bank account. It took a few more weeks to straighten out the mistake. By mid-January, the Herberts had received all their money, minus an $80 fee. After I asked about that, AET refunded all but $25 to the Herberts’ PayPal account, a resolution with which they were happy.

A Washington Post spokeswoman said that the paper had decided to re-evaluate its AET advertising relationship as a result of these incidents.

“Our readers come first, and American European Travel has worked diligently with us to address reader concerns as quickly as possible,” said Post spokeswoman Kristine Coratti. “While we understand that this was a one-time technical issue, following completion of the remaining previously scheduled trips to Turkey later this year, we will no longer be offering trips in partnership with AET.”

Should the Post have terminated its relationship with AET?

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44 thoughts on “Keep us posted on that refund

  1. I am very much against Government interference in most things. However, this is one area where I’d like to see a regulation that punishes companies that hold on to consumers’ legitimate refunds for an undue length of time. As Chris has voiced many times; they take your money at the speed of light, they should be able to refund it to you quickly. Nail these companies with a high enough fine and I’ll be they straighten themselves out.

    1. There are laws, but there seems to be very little known about them, including through Chris’ site, which would be a great service he could provide. Many states have them, but you have to know how they apply to your travel considerations. Here in the State of CA, we have one. But you have to be a resident of CA to utilize the protection and the company you pay for your travel arrangements needs to be registered to do business in CA. If all this is in place, and the tour company doesn’t come through with what you paid for, the state has a fund that will pay you when all other options have been tried. So as a resident of CA, this company being talked about doesn’t show a SOT number on their front page of their website. That is a red flag for me. I can then go to the State Attorney General’s webpage, look up the Seller of Travel link and check on this tour company. If they are registered and current with their registration the website will tell you this. If the company isn’t listed, then you will have zero protection from the fund should you go book with this company and not get the travel you paid for.

      1. So, as a resident of CA, part of your taxes go to paying people who get ripped off by tour companies? Not exactly what I had in mind.

        1. The fund receives money from tour companies and travel agents by way of registration fees and yearly renewals. No tax dollars in the restitution fund.

          1. So, the tour companies and travel agents charge every customer a bit more in order to pay out from this fund, right?

          2. No. Where did you get that idea? Every travel agency that sell to any resident of the State of CA has to pay a fee to the SOT to get their CST#. Then there are additional fees to pay when renewing your number. Just like any tax a city charges a business to open up shop within their city limits.

          3. Yeah, so where does the company get the “extra” money they have to pay into the fund? From their customers. In theory, if they didn’t have to pay into the fund, the cost to the consumer would be less. Just like any business. When the government implements a fee or a fine or a surcharge to the business, the business turns right around and charges their customers extra for their product. They certainly won’t take it out of their profits.

          4. Any cost to any business gets passed on in some way, but the cost is not high. So you might have a 1 cent added cost to your trip from the vendor. The TA doesn’t add it on. All a part of doing business and offering a consumer protection. Many states have it and more are adding it. Pretty good for CA residents. Sadly, it isn’t well known.

          5. So, the $0.01 from this fee, plus the $0,05 from that fee, plus the $0.10 from the other fee and soon enough you have to charge your customers an extra few bucks because of governmental crap. But, it’s California, so what do you expect?

          6. What are you missing in my posts? Other states have Seller of Travel laws that require registrations, too. Though, not all have a restitution fund. What state has the biggest loser of travel companies? Florida, right where Chris lives. More scams from FL that any other state. As an agent, I know that those companies who pay to sell in CA will give my clients an added protection. Has this been tested? You bet and those who were due refunds, got them. Worth a penny?

          7. I’m not missing a thing. California charges travel companies a fee to belong to a fund that pays consumers who get ripped off by travel companies. I’m sure that the California legislature bills this as some sort of “self-regulation” for the travel industry there. Like any charged with a governmental fee, the travel companies simply pass this fee on to their consumers in the form of higher prices. You dismiss this fee/price increase as negligible, simply “a cost of doing business”, but providing the consumer with protection – protection that, I remind you, they pay for as the travel companies raise their prices to absorb the fees. I point out that these fees can, and do, add up over time as they accumulate. My reference to “it’s California” is simply a reflection of my belief that California leads the country in taxing and surcharging their citizens. I live in Maryland; unfortunately, we’re not far behind you.

          8. I believe Florida lead the way on the SOT requirement. At least I know what companies NOT to do business with and that is important in today’s screw ’em attitude.

          9. Its not a California thing. Not even close. Most states (I hesitate to say all merely because I haven’t checked every state) charge licensed professionals an annual fee as part of the license, whether a contractor, CPA, doctor or attorney. This fee is justified, even under free market principles, because those licensed professionals enjoy additional market pricing power because of the state granted monopoly.

            You, MarkieA, cannot practice law. I can. As a result, my earning power is vastly increased because of the lack of competition resulting from the state sanctioned monopoly. There are strings attached to receiving such a huge benefit from the state.

            As we know from history, monopolies can have very detrimental effects on society. Accordingly, it is normative and appropriate for the beneficiaries of this monopoly, to pay to protect the society from the consequences of a monopoly. My $500 annual fees goes towards, a restitution fund, attorney discipline, etc.

  2. If AET had not refunded the Herberts’ and Olsons’ money, I wonder if the Washington Post could have been held responsible for their refunds? By allowing their name and logo to be used on the advertising insert, they were giving potential customers that they were involved in the organization and management of this trip. Companies with good reputations and deep pockets need to be careful about who they “partner” with.

    1. I think it may be even more significant that the Post recieved money for each lead generated by the flyer. The Post was almost acting as a sales agent for AET.

      1. It’d be helpful to see the actual insert. Was it just a straight ad for this single company co-branded with the paper? Or was it one of those hybrid pieces that are heavily advertised but contain a bit of editorial content to hook people into reading it? You see the latter all the time and their argument would be the logo just designated it as something they produced, not that they were vouching for the advertising.

    2. There is no way to know. That would really turn on the specific details. Would a reasonable person believe that the Post was a sponsor of the trip? There aren’t nearly enough details in the article for the level of legal analysis.

        1. Unfortunately, not enough information. An example, though not the case here, you can’t sue Michael Jordan if a pair of Air Jordan’s are defective.

  3. When the Post says. “We will no longer be offering trips in partnership with AET,” they have just made themselves liable for their partner’s failure, since that is part of the definition of “partnership.” If their lawyer then says they weren’t a real legal partnership, having said they were partners is enough to get them into an “ostensible partnership” lawsuit, a far too expensive proposition to ignore.

    1. No, not really. That would just be one of the many factors that an experienced attorney would weigh in determining whether to name the Post in a lawsuit. It’s not dispositive one way or the other. Terms are bandied about all the time with great imprecision. “Partnersihp” is no different. A court would be more interested in the the acts of the respective parties.

    2. The “partnership” could be as simple as agreeing to publish ads for the company. Newspapers dissolve partnerships like that every day with accounts that fail to pay their bills. It doesn’t make them liable for anything the company does.

  4. Um…explain the $80 dollar “fee”? Fee for WHAT? For allowing this couple to book a trip that was never delivered? So then they reduced the “fee” to $25…okay, that’s better, but still, what was the fee FOR? For allowing AET to keep their money for months and play games with it, and probably earning interest on it while they kept it and played games with it?

    The article says the Herberts were happy with that outcome…but they’re still out $25 for nothing! They had to PAY for the pleasure of giving their money to a company who never gave them anything for it, kept it for weeks on end, and had to be squeezed and pressured to give it back to them, minus a “fee”. In reality, AET should have paid THEM a fee for keeping their money for so long, and forcing them to spend untold hours fighting to get it back!

    Wow. Well, there’s another company that goes on my “never do business with” list.

      1. True, but the merchant has the ability to choose who pays the fee, and it seems they chose to pass it on to the customer. As a freelancer, I’m often paid through PayPal and I think it’s cheap when the merchant passes on the fee to me, when it’s the merchant who decided to pay through that medium.

  5. I read about a similar situation, and I think it was the same travel company, in the Chicago Tribune in Jon Yates’ column, The Problem Solver. I think I remember it being resolved the same way – people eventually got their refunds

  6. Why did AET decide to keep $80 as a fee and then when asked, give back all but a $25 fee? They didn’t deliver, there should be no fee at all. There should be a big fine.

  7. Ladies and Gentleman, there are many states in the USA that have Seller of Travel Laws. If you are going to book travel, do your homework, REGARDLESS of where you received the information on the component or components you are concerning paying for. These Seller of Travel laws are usually through the State Attorney General’s office. I went to the mentioned tour company and I see no SOT number listed on their website. Their physical address is NYC and the State of NY has a SOT law, yet none is showing. SOT numbers should be on the front page of a website, on any printed brochures or mailers that they put out…even in a newspaper ad. PLEASE protect yourself by reading up on your state’s laws and how they can protect you as these are consumer laws that have come about due to shady business practices as seems to have been the case with this TO. Once you understand your state’s law, then you will know what to look for in a travel company you might want to do business with.

    1. That’s good advice. Many legit businesses have state or federally issued numbers. For example, I have a bar number. Most contractors, attorneys, medical providers, and tradesman (contractors, plumbers, etc) have a state issued license, certification, etc., that is prominently displayed. Be wary when these numbers are absent.

  8. Months of “technical difficulties” to process a refund? If your computers are hassling you, instead of making your customers sit and wait for months while you fight, you order a book of checks from your bank, write them, and put the *bleeping!* checks in an envelope! How hard can that possibly be?

    1. The “technical difficulty” was probably not in physically writing the checks but more likely that there wasn’t enough money in the seller’s account to keep the checks from bouncing.

  9. Rather than just re-evaluating their relationship with this one company, maybe the Post should reconsider blindly stamping their logo on inserts. I’m curious how much more that cost the travel company than just the standard insert fees, and also how much greater a response this would get with the paper’s logo on it. Do people actually trust newspapers that much any more?

    1. From what I can determine, the AET probably did not pay anything for the inserts. The arrangement with the Post likely provided that they print and distribute the inserts and that the Post would receive a large commission for every trip that was sold. One could argue that AET and the Washington Post were full partners in this scheme.

      1. That’s not exactly clear. I’ve worked in and around papers for a number of years and, while I’ve never worked for the Post, I’ve never seen precisely the arrangement Chris describes. Inserting is a major source of a paper’s income and it is guaranteed money–telling an advertiser you’d waive that fee on the chance of making more on commission basis is risky for the paper and potentially could cost the advertiser more than just paying for the insert.

        And to keep the advertiser honest there’d need to be some way for the paper to verify how many trips were sold which would be problematic unless the paper was going to be involved in the fulfillment process. It’d end up taking up a ton of resources with no guarantee of success.

        What you do see a lot of are special advertising inserts the paper itself puts together. Like a travel insert with an article or two to attract readers, then with ads sold into it. Those do typically contain the paper’s logo. And those sometimes can have a single sponsor. But the paper puts it together, it’s not handed to them by the advertiser like Chris mentions. And in those ads are typically paid for; it’s not a commission deal.

        1. These are very difficult times for the newspaper industry. My daughter works in upper management at a large city newspaper and they are experimenting with all sorts of new ways to generate revenue. Perhaps, that is what happened at the Post.

          1. Possibly, but this demonstrates very well some of the pitfalls of such a strategy. And while I have seen some pretty crazy advertising ideas implemented, inserts are actually an area where newspapers are holding the line fairly well, largely because there aren’t a lot of other good options for getting printed inserts into people’s hands. It’s not a sound idea if they did go that route, and not just because of the potential for being blamed when the company doesn’t keep its promises.

      2. One might, but one probably shouldn’t. We don’t have the facts, but I would hazard a guess that the arrangement wouldn’t come close to meeting the legal definition of partnership.

        A partnership requires a close relationship. Some elements might include, a contribution of capital to a common account, the right to inspect books, delineating a common purpose. Most important is the existence of a fiduciary duty, which I cannot imagine exists here.

        I suspect that this is merely an arms length transaction, perhaps the analogous to a commission-based sales contract.

  10. They thought that the newspaper who contained the insert had “approved” the trip? Some people should not be allowed to spend money or travel without supervision.

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