THE LAST WORD by TONY HAZELL: Why are XL holidaymakers still waiting?

By Tony Hazell for the Daily Mail
Updated: 18:22 EST, 29 September 2009

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It's a year since travel group XL went under, yet still nearly 10,000 customers have not got their money back.

Instead many are caught in a pingpong game between the Civil Aviation Authority and the credit card companies, both of which refuse to accept responsibility for compensating those who lost their holidays and their money.

The root of many of the problems seems to be the lack of an agreement between credit card groups, XL and the CAA over who would pick up the bill in these circumstances.

Grounded: XL is yet to offer any compensation to 10,000 customers

The fiasco has exposed a gaping hole in consumer protection.

Section 75 of the Consumer Credit Act says that even if part of a bill is paid using a credit card, then the credit card company is jointly and severally liable to refund the full amount in the event that the service is not delivered.

So it would appear that the credit card companies have a legal duty to cough up.

However, in the past, the CAA, through its ATOL bonding scheme, has paid part of the bill when travel companies have collapsed - and it seems the credit card companies want it to do the same this time even though no agreement to do so was in place.

While these organisations squabble, consumers are caught in the middle. A year is too long to wait for a legitimate refund. These travellers believed they were protected by their credit card company and the ATOL scheme.

The Department of Transport says it will be consulting on reforms to the ATOL scheme, but these will come too late to help XL's victims.

It's time that someone from the Government called in the protagonists, bashed their heads together and demanded that refunds are paid immediately.

It doesn't matter who eventually foots the bill - if necessary, the card companies and CAA can fight it out in court later - it simply matters that these people are paid without further delay.

How much longer?

How much longer must we wait for Barclays to admit it has missold the Aviva Global Balanced Income and Global Cautious Income funds to a large number of investors and promise a fullscale review of all such sales?

How much longer must we wait until the Financial Services Authority, as regulator, orders such a review and demands the bank pay compensation where necessary?

How much longer must we wait until the FSA prescribes a formula for compensation for those investors who have been mis-sold? How much longer must we wait for the FSA to take any noticeable action over this scandal?

How much longer must we wait for Barclays to apologise for misleading so many customers?

Customer dis-service

Customer service is, I'm convinced, getting worse.

Two letters published today on Margaret Stone's advice page illustrate perfectly the arrogant attitude many companies take towards customers who complain and their lack of will to sort things out.

Vodafone's appalling behaviour to a customer who signed up to a new contract beggars belief.

First, it gets the contract wrong and tells the customer they are stuck with it; then it delivers the handset to the wrong address and refuses to deliver a replacement one; finally, it sets debt collectors on the customer.

Citibank is no better. Having spotted fraudulent transactions on a customer's credit card, it then left them there, adding interest and charges along the way.

Even when Margaret Stone intervened, its inept customer services department still took more than two months to solve the problem.

Would you take a credit card from Citibank or buy a phone from Vodafone after reading these tales? I certainly wouldn't.