Travel Clubs — Scams or Bargains?

February 14, 2012

By Terry Smiljanich:

Have you received a sales pitch telling you of the wonderful bargains that you could get if you joined a travel club? For a lifetime membership of just $5,000, you, your spouse, and children can participate in thousands of incredible trips at half the cost, including airfare, luxury hotels, and other amenities. Only one problem – it may very well be nothing but a slick scam.

Unfortunate Victims

CWN recently heard from a senior citizen couple who unfortunately got suckered into such a scam. Owners of a timeshare in a condo, they traded for a vacation at a beach resort in Daytona Beach, Florida. There, they were invited to an “owners welcome dinner,” where a sales representative pressured them to join a “travel club,” promising thousands of locations worldwide, with savings of between 40% and 70% below retail. This included airfare, hotels and car rentals.

It all sounded great, so they paid more than $5,000 for a lifetime membership, which included their adult children as well. They looked over the contract, which seemed harmless, and could find nothing on the web to warn them off.

Then they discovered that all they were being offered were second rate travel options at bargain prices they could have found on their own. As for the thousands of potential trips, every one they checked on turned out to be “unavailable.”  They tried to cancel their membership, but got nothing more than unanswered phone calls.

A Prevalent Problem

Many travel clubs have given the travel industry a bad name. Consumer protection sites often contain numerous stories of people who have been scammed by such clubs.

If a travel club costs more than just a few dollars to join, it is most likely a very bad idea. If you join, you will be given a discounted menu of trips, but the restrictions will be prohibitive. For example, trips within 10 days of a holiday may be excluded, which means that in a calendar year there are only about 32 travel days that meet this restriction. And that luxury hotel on Waikiki may turn out to be a second rate hotel on a busy street eight blocks from the beach.

To add insult to injury, many such clubs tack on a “handling charge” to the cost of your booking. If you don’t like your travel accommodations or schedule, you can “upgrade” for an additional charge.

Consumer protection agencies like Florida’s have warned citizens about falling for such grandiose promises. “Major hotels” might mean a Super8 in a business district. “Major airlines” might include Turkmenistan’s national airline. Online searches will probably uncover bargains equal to or better than those being offered by the travel club (without the $5,000 fee).

The Better Business Bureau has called travel clubs a “suspect industry,” in which consumers rarely make back in savings the cost of joining the club.

What You Can Do

The main thing you can do to avoid being cheated is to simply stay away from any travel club that costs more than a few dollars to join. Travel clubs don’t control discounts. Only the suppliers of travel (airlines, hotels, etc.) can offer such discounts, and these are usually available directly to you.

If you are being promised the use of “major hotels” and “major airlines,” demand to know the actual names so you can judge for yourself. And while you’re at it, don’t rely on the phone numbers or web links offered to you by the travel club to double check on the quality of the travel accommodations.

If you don’t have the time or inclination to do your own search for travel bargains, you can always turn to a reputable travel agent who knows how and where to find deals, and who is working to keep you satisfied.

Travel can be a wonderful way to unwind from a stressful job, or expand your horizons. The last thing you need is to find out you’ve been cheated out of $5,000.