A travel company owner has been jailed for two and a half years after falsely claiming holidays were Atol and Abta protected and for trading when insolvent.
Alan Steel of Leamington Spa, the owner and director of Russian Gateway, was sentenced following prosecution by Warwickshire County Council’s trading standards service.
Russian Gateway sold package holidays to Russia and the Ukraine through brochures and online.
Steel claimed the holidays were protected by an Atol licence and Abta membership and that clients’ cash was held in a trust account.
The court found his claims to be false.
Steel pleaded guilty and was ordered to pay £41,000 compensation and costs of £11,000 in addition to receiving the jail sentence. He stands to forfeit a further £180,000 after the court issued a Confiscation Order.
The fines come on top of CAA enforcement action against Russian Gateway last year which resulted in a £2,000 fine and £13,000 compensation paid to three former customers.
Steel was also disqualified as a company director for 15 years.
He had claimed “Russian Gateway is complaint with the European Commission Directive on Package Travel”, telling consumers: “Your money is kept secure until you return from your holiday ensuring repatriation should Russian Gateway go bankrupt.
“You are 100% protected in the . . . event of our insolvency.”
The court found Steel had given one client the Abta number of another travel firm.
Warwickshire’s trading standards were alerted to Russian Gateway in 2011 when the CAA made the service aware the company was trading without an Atol.
The CAA took legal action in April 2012, but Steel continued to sell holidays. Indeed, the court heard he continued to trade after going into liquidation.
In a statement, Warwickshire trading standards said: “Consumers should be able to buy package holidays in the knowledge their money is protected.”
A spokesman for the CAA said: “The CAA will continue to work closely with trading standards teams to identify breaches of the Atol regulations and consider action where necessary.”