Stealing My Thunder…
This stinks on several levels. I had planned on writing about my Pittsburgh Steelers who have safely touched down in Tampa for this weekends Super Bowl and with “Media Day” scheduled, I wanted to write about some of the lesser known “characters” with the team. I have no idea if Jeff Reed will show up on NFL Network or ESPN or not, but if you do a little research, you’ll find a fun guy, who also likes to play practical jokes.
I still have most of the week to write about MY Pittsburgh Steelers, but for today, I have an update on the Travel Industry, more specifically Joystar which I wrote about a couple weeks ago. I’d also like to clarify some things that I’ve read out there on the internet to help separate fact from fiction. It astounds me that people either don’t know how to read, or don’t know how to research.
First, InterContenential Hotel Group (IHG) has won their suit in U.S. District Court against Joystar and a judgment has been ordered for $179,000. In a report filed by Travel Weekly, who by the way got it right, states that it was one of Joystars Agents, not Bill Alverson or Joystar themselves who committed the offense. (The Agent was a former IHG employee who hacked the IHG system.) You may be asking why Joystar is even involved if that’s the case. Well, Joystar became more or less an accessory when they failed to return $115,000 of the $163,000 that was claimed improperly. If Joystar would have done the right thing and returned all he commissions, they more than likely would have gotten a slap on the wrist, and charges would have landed solely on the Agent. (The commissions were charged to go to the Agent and his wife.)
In another case Joystar sought more time to prepare its response to an involuntary bankruptcy suit filed by a group of agents. Joystar owes individual Agents thousands of dollars in unpaid commissions. 85 agents have submitted sworn statements about money they are owed. Thus the word “involuntary” in front of the word bankruptcy. You might think that all bankruptcy should be considered involuntary, and many I’ve seen comment on this apparently don’t know the difference. True involuntary bankruptcy occurs when an individual or organization is made bankrupt at the request of their creditors, in this case the Agents who have filed the petition. In the case of Chapter 7 involuntary bankruptcy the debtor will be required to liquidate their assets in order to pay off their creditor.
In other words, the agents themselves are forcing Joystar into bankruptcy, and when assets are sold, they are the ones who get paid. If you didn’t catch the last paragraph in Travel Weekly’s report on IHG, if the petition is won, and judement is made forcing JoyStar to file bankruptcy, both the Agents and IHG become “judgment creditors”.
And finally, three major cruise lines — Carnival Cruise Lines, Holland American Line and Princess Cruise Lines discussed how to handle pending commissions and bookings still on the books. In filings with the court, the cruise lines had said that they needed the stay lifted so clients can make final payments on cruises so that they can take those cruises. The cruise lines’ court filings said that they also want to be able to transfer current bookings to individual Joystar agents themselves, withhold payment of commissions to Joystar and to pay commissions to agents once their clients have made final payments on their cruises or once the passengers have sailed. In court, lawyers also discussed putting those commissions withheld from Joystar into an escrow account for a short period of time, as well as logistics for transferring bookings from Joystar to the booking agents.
A long term solution should be address concerning this mess on February 10th.
Bill Alverson was present, and asked for a 20-day extension to prepare its response to an involuntary bankruptcy filing. Judge Raymond Ray, the presiding judge, gave them a three-day extension, and the next hearing in the case is set for Thursday.
At this point, it remains up in the air if I’ll report on this Thursday or Friday. it’s not that I don’t care about what happens here, but I do have more important things on my mind at the present time. ;-P
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Tags: Bill Alverson, Joystar, Travel Agent Commission, Travel Agent Issues
January 27th, 2009 at 8:01 am
Can you explain the math? If the agent tweaked IHG’s system to pay Joystar $163K and Joystar kept $115K that indicates a 30% split for the agent–and that is a program Joystar did not have. Of course when it came to light, Joystar should have returned the money. By the way, this was a default judgment–Joystar never showed up in court.
Your comment about it not being Joystar or Alverson who committed the “crime” is interesting. I guess this is setting a precedent that the INDEPENDENT contractor is not so independent after all. Does YTB have any protections in place to prevent this type of issue? I mean if Joystar was embroiled in it with only a few thousand ICs, is it a matter of time before YTB may be facing a similar thing with 100,000 ICs?
And finally, according to the reports, Alverson was NOT at the bankruptcy hearing. He was represented by his attorneys. From what I have heard, Alverson–the man–has quite literally pulled a DB Cooper.
January 27th, 2009 at 12:59 pm
I’m not quite sure how you, being the expert that you are, can’t come up with a feasible or logical explanation for the discrepancy.
Based on my experience and expertise I would deduct that the difference consists of what was actually paid to Joystar and what the Agent transferred over as bookings. Any industry veteran understands that commissions are not paid until after the travel has been consumed. While there were some $163K in bookings transferred, only $115K had been consumed and therefore paid to Joystar.
As far as “protections” go, absolutely. (At least in regards to keeping YTB out of mess like this.) In order to work a scam like the one created by this Traditionalist, the IC would have to manually submit $163K worth of bookings via commission claim forms through YTB. Something this large and this vast in regard to locations and times would certainly raise questions at the home office.
That being said, the IC could, if they had the proper knowledge, transfer and receive the commissions directly using YTB’s numbers. I would question why anyone would go through YTB and all this trouble only to receive a 70% commission split?
And lastly, let me be the first to thank you, the Traditionalist in this industry for showing us how to be not only responsible, but professional. If what you claim does come to light and someone in YTB is convicted of a crime such as this, I highly doubt you’ll consider just who created the scheme and were the responsibility lies.
January 27th, 2009 at 2:09 pm
The article you cited says the following:
IHG had claimed that one of Joystar’s agents raided the IHG booking systems and took $163,000 in improper commissions. The lawsuit, filed in Atlanta on Oct. 15, claimed that Thomas Perkins, a former IHG employee and Joystar agent, accessed the IHG system and peeled off direct bookings, then claimed them as commissionable sales for himself and his wife.
According to the IHG complaint, Joystar kept $115,000 of the improperly claimed commissions.
Agent took 163K in COMMISSIONS (not bookings) and Joystar kept 115K. The math still does not add up. So much for your “experience” and “expertise”.
I was not talking about an identical scam. I was just commenting that this may indeed set a precedent that if an IC pulls a stunt (MLM or TTA) that the host may indeed be liable.
Not sure I understand your last paragraph.
January 27th, 2009 at 3:18 pm
Good grief!
Of course you don’t understand, because what you copied and pasted went right over your head. These were “claimed as commissionable sales”. The Agent raided the “booking system” and “peeled off direct bookings”. By using the word “bookings” DOES NOT mean or specify the commissions themselves now does it?
It’s not a huge issue for me like it is for you John. I’m not all over the internet like you are just happy to get noticed anywhere I can, proclaiming to be some sort of “expert”. If you want to pitch your idea that Joystar only pays 30% commission, be my guest. Knowing the industry the way I do, your idea is a complete pile horse hockey.
Lastly, this “scheme” was not created by an MLM’er, it was conceived and shown to everyone in the industry by one of your own, a “Traditionalist”. If you ever do find an MLM’er who has the audacity to do the same, you can look back to this example as being the catalyst that started it all.
I want to be the first to thank you and other Traditionalists for being a shining example of how to cheat, steal and lie. You SHOULD feel proud.
January 28th, 2009 at 11:23 am
You really need to look into your “issues” Doug. It is amazing that when you are confronted with a reasonable discussion you immediately turn it around into an attack of sorts. And when proven wrong, your standard comment is “thanks for sharing”.
I never professed to be an expert except in my own travel business. I do have an opinion for sure and if others share that opinion, well, that is not my fault. After all you have plenty that share yours–do you not?
And speaking of opinions, I already stated mine, but what are your thoughts on the NCL termination? Do you not need NCL any longer? Is Andy Stuart now going to be making beds with Lisa Bauer? Will you organize the “World’s Largest Gift Certificate Sale” to show them who’s boss?
Could it be that my sources a few months ago were correct in that a MAJOR player was preparing to drop YTB. Granted, I guessed wrong at the vendor. But, I do have a suspicion that there are some more to follow in NCL’s footprints and that there may even be a vendor I named that extensively modified your agreement.
What is your opinion on those items. I am always looking for the opinion from a “TravelPro”.
John
PS..which aisle would I find the soy sauce?
January 28th, 2009 at 1:53 pm
John;
If you don’t like what I have to say, then why to you come back? If it were me, I simply wouldn’t participate on a forum or message board where I felt unjustly attacked and ridiculed for no reason. You may have noticed that I reserve my opinions and position about the industry to this blog. I don’t care to participate where I am not wanted, and it suits me fine. If you agree with me and like what I have to say, subscribe to the RSS feed, and RTA’s can subscribe to my Newsletter.
Otherwise, don’t read or participate.
You on the other hand enjoy trolling the internet all morning like you do every day. As of this morning you have posted several times on your blog, scam.com, TravelPulse, Travel Weekly Forums, Yahoo Finance, and now here. How you earn a living from doing that is a question I fear will never be answered.
As for being a “self proclaimed expert” I would suggest that you retract your article on TRO, and remove the link on you blog which states: “If you are a member of the media and would like to contact this blogger, please click here.” Both the article and that hideous blog are dedicated to the topic of MLM’s and not your business of trolling the internet.
As far as NCL goes, looks as if you’re not as well connected as you might think. Been waiting to see when or if you would catch on, and based on the fact that a true media outlet released the information, keeping you in the dark for more than a week is amusing.
The YTB release you found this morning was in my in-box on the 21st.
As far as my feelings about NCL, don’t put words in my mouth, as I am capable of communicating effectively on my own thank you.
If you had a choice to sell Carnival, Disney, or Princess at one level, or sell NCL at 40% less, who would you try to book? NCL has never supported YTB the way Carnival, Disney, MSC, Regent, Globus, Trafalgar, and other preferred suppliers do. Sorry to see them make the choice they did, but it happens in this industry. RCCL dropped commission on YOU last year unless you upped your bookings. It’s part of the industry and from what I understand, both parties (YTB and NCL) agreed that it was not a relationship either wanted to pursue or cultivate.
So…in so many words…”Thanks for sharing”.
PS – Don’t you mean “sour sauce”?
April 4th, 2009 at 10:16 am
[...] the hope that this will be enough to keep those still around alive. Unfortunately it was to little too late for Joystar, and Cruise Value Centers, while a report late last weekend documented that Liberty Travel closed 4 [...]
April 4th, 2009 at 12:28 pm
[...] the hope that this will be enough to keep those still around alive. Unfortunately it was to little too late for Joystar, and Cruise Value Centers, while a report late last weekend documented that Liberty Travel closed 4 [...]
April 4th, 2009 at 5:02 pm
[...] the hope that this will be enough to keep those still around alive. Unfortunately it was to little too late for Joystar, and Cruise Value Centers, while a report late last weekend documented that Liberty Travel closed 4 [...]
May 13th, 2009 at 9:25 am
[...] the hope that this will be enough to keep those still around alive. Unfortunately it was to little too late for Joystar, and Cruise Value Centers, while a report late last weekend documented that Liberty Travel closed 4 [...]
May 13th, 2009 at 4:06 pm
[...] make it through these difficult economic times. We’ve already seen a number of agencies such as Joystar and Cruise Value Center bite the dust. Suppliers like Happy Vacations have closed their doors as [...]
May 13th, 2009 at 4:08 pm
[...] make it through these difficult economic times. We’ve already seen a number of agencies such as Joystar and Cruise Value Center bite the dust. Suppliers like Happy Vacations have closed their doors as [...]