Guru Travel fiasco hits ordinary New Zealanders

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Call for a thorough inquiry gets louder

Venkat Raman

$2380 is a lot of money to a lot of New Zealanders.

Losing that money to a fraudulent travel agency is unforgivable.

That is how Wellington based Dr Sripriya Somasekhar felt after a vain attempt to convince Malaysian Airlines that they have the responsibility to lift passengers on its services- passengers who have genuinely purchased tickets and paid for them in advance through a travel agency.

Travel Agents Association of New Zealand (TAANZ) said it cannot help people like her because Guru Travel,  the agency through which they had booked their tickets is not a member and hence the Association has no obligation to come their rescue.

Auckland based Guru Travel Limited went into liquidation on November 21, 2019 but its customers were not given any notice by the company or by Shareen Ramasre, listed as a Director of the company in the Companies Office Register.

When a company goes into voluntary liquidation, the worst affected are ordinary New Zealanders because the monies that they have paid for obtaining a product or service is ‘unsecured credit,’ deserving the lowest priority in the order of payments disbursed.

Betrayal of faith

Sripriya is among 200 or more people who have jointly lost about $380,000 or thereabouts to Guru Travel – lost, not out of negligence but out of good faith. They have been defrauded and left in the lurch during the peak travel season.

These travellers had booked their seats through various airlines.

But Sripriya believed in keeping her promise; to her ten-year old son Advait Jobi Mathew that she would take him on a holiday to India this summer and to her parents in Chennai that they would arrive there on January 26, 2020. She did.

“I was informed on January 2, 2020 that the e-tickets issued to us were not valid. That was when I contacted them to confirm our meals on board the concerned flights. After trying in vain various options, I finally booked our seats through another airline. However, because of the busy season, the cost of the two tickets has increased to $3500. I did not want to disappoint my son and my parents and hence took a loan to purchase the tickets,” she said.

Sripriya said that she had saved $2380 over a period of one year and repayment of the new loan of $3500 would take her even longer.

Need for new legislation

Indian Newslink readers have made seven recommendations following the closure of Guru Travel.

They are (1) conduct a thorough investigation of the dealings of the company over the past three years including an audit of its financial transactions (2) bring in a new legislation that will protect ordinary New Zealanders from travel agencies that fail to meet their obligations (3) put in place stringent code of conduct mandatory to travel agencies (4) make membership to TAANZ mandatory to all travel agents and/or make it obligatory for the Association to honour all tickets purchased by travellers (5) Commerce and Consumer Affairs Minister should help the victims of Guru Travel through existing legislation under the Customer Guarantees Act (6) Commerce Commission should examine if there are provisions under its jurisdiction to bring justice to victims and (7) Serious Fraud Office should examine if a case exists for its involvement

Bonded Agents

Sripriya and other victims were told that Guru Travel is not a bonded travel agent and as such is not a member of TAANZ.

“There should be a system which prohibits travel agencies from trading unless they are members and as such carry out their obligations. There should also be a system which raises alarm bells when an agency begins to default on payments to airlines,” they said.

“Airline carriers should also have the obligation of ‘warning’ travellers when an agency defaults payments. Since common people are placed under risk, there should no privacy issue consideration in revealing the names of agencies that default,” they added.

Liquidator’s observations

Gareth Russel Hoole and Clive Robert Bish, Chartered Accountants and Chartered Accountants Australia New Zealand Accredited Insolvency Practitioners (New Zealand) have been appointed joint and several liquidators of Guru Travel pursuant to section 241(2)(a) of the Companies Act 1993.

A Stuff report on January 14, 2020 said that Gareth Hoole has determined that Guru Travel owes more than $370,000.

“Hoole had established that no funds were held in trust for customers and preliminary investigations found it appeared that the money was paid to a wholesaler and used to settle ‘legacy debt’ rather than to pay for customers’ travel. The liquidators consider this to be irregular and will continue to investigate that matter with a view to consider seeking to void transactions paid to the ticketing consolidator/wholesaler,” the report said.

Indian Newslink hopes that the government will take up the cause of the victims and examine ways of redressing their grievances.


Photo Caption:

Dr Sripriya Somashekar with her son Advait Jobi Mathew

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