Attorney General Hardy Myers today announced that two Arizona travel agencies targeting Oregon high school and college students with inexpensive travel packages to Mexico must change their advertising and refund policies in order to operate in Oregon. Myers made the announcement in conjunction with "Operation Trip-Trap," an effort coordinated by the Federal Trade Commission with 21 federal and state law enforcement authorities to educate consumers about buying travel packages.
Named in an Assurance of Voluntary Compliance, filed today in Lane County Circuit Court, are All College Travel, Inc. and Cerkvenik-Anderson Travel, Inc., which does business as Student Tours, Mexico Tours, College Tours and All College Travel. The president of both corporations is Andy Anderson of Phoenix, Arizona.
"High school and college administrators should be alert to unauthorized travel tour solicitations being conducted in their schools," Myers said. "Low-priced vacation tours offered by out-of-state travel agents are very appealing to students and their parents but could end up as travel disasters."
Oregon Department of Justice investigators first looked at the Arizona companies after receiving complaints from parents with a variety of allegations including failure to provide adequate numbers of hotel rooms, misrepresentations in advertisements including failure to disclose extra costs for parties and other events, and claiming membership in the National Association of Student Councils when no affiliation existed. Investigators also found the companies were selling insurance products without being licensed by Oregon's Insurance Division, and that they failed to provide timely refunds for services not provided.
The companies made national notoriety when a television program played a home video taken of a high school tour to Mexico having a wet tee-shirt contest on an international flight with the pilots participating as judges. One of the first parents to complain was State Representative Vicki L. Walker of Eugene, whose daughter Sara, then a senior at Sheldon High School, had taken one of the tours to Mexico. Other complaints came from consumers in Lane and Deschutes counties.
As a result, Representative Walker successfully advocated at the 1999 Legislative Assembly passage of Senate Bill 218, which requires all Oregon school districts to adopt policies governing the solicitation and sale of travel services to students as well as other restrictions on sales of travel packages.
"Parents should be extremely cautious sending their children on vacation tours to foreign countries without competent, known and trusted adult supervision," Walker said. "While these tours may provide staff, they are not chaperones and oftentimes, only a few years older than the tour members. Sex and alcohol are common themes of events and parties and the dangers of over-consumption are serious for all young adults involved."
Anderson and his companies, which admit no law violation, agreed to make payments through the Oregon Department of Justice for students and parents of up to $28 for purchase of each insurance premium and no more than $80 for additional fees paid for events which were to be included in the original tour packages.
Victims have 30 days to write the Financial Fraud/Consumer Protection section of the Oregon Department of Justice detailing the basis of the claims including proof of loss. Proof can include receipts for insurance premium payments and/or receipts of extra payments for events included in the original package price.
The Arizona corporations will pay $25,000 to the Oregon Department of Justice to cover individual claims. Any remaining money will be placed in the Justice Department's consumer education fund.
Anderson agreed to a number of changes in his company operations including timely and complete disclosure of contract terms, the design and placement of clear and conspicuous advertising of all activities not included in the basic tour package, and not overbooking hotel accommodations. The Arizona corporations will comply with Oregon's insurance and consumer protections laws and will make a good faith effort to minimize over-consumption of alcohol by students who can lawfully drink, and not require alcohol consumption for participation in any event.
Claims may be filed by writing Travel Refunds, Financial Fraud/Consumer Protection section, Oregon Department of Justice, 1162 Court Street, N.E., Salem, Oregon 97310. For general information about travel scams, consumers may call the Attorney General's consumer hotline at (503) 378-4320 or (503) 229-5576 (Portland only) from 8:30 a.m. to noon, Monday through Friday.
Jan Margosian, (503) 947-4333 (media line only) firstname.lastname@example.org