The limited number of trust providers with sophisticated technology will limit any wholesale move by to trust arrangements by Atol holders, according to industry experts.
Leading industry accountant and head of travel and leisure at White Hart Associates Chris Photi pointed out: “There is a paucity of professional trustees with appropriate systems.”
Speaking at the recent Travel Weekly Future of Travel conference in London, Photi argued it was “nonsense” to suggest trustees would have to check every single transaction if a business switched to trust arrangements, arguing: “That’s like saying to an auditor, you have to check every transaction in an audit. It’s based on a sample selection.”
But he insisted: “The only way you can do it on any sort of granular level is to have sophisticated systems, [and] there aren’t many trustees out there with that capability.”
Themis Advisory director Jo Kolatsis agreed, saying: “There is a paucity of trustees with decent back-up systems.”
She said, “I know of one good one” and suggested another “has some great systems and has invested heavily in those systems”. But she noted: “I’ve heard a few horror stories of others, about their systems and handling when operators have tried to leave one trust outfit for another.”
Kolatsis argued: “There needs to be a review, or at least a benchmark, of services trust providers offer and at what level because it’s easy to say you operate a trust account and stay within certain parameters, but who is overseeing that?”
Martin Alcock, director of the Travel Trade Consultancy which offers trust arrangements, told the conference: “There are a handful of us out there who understand the rules. Partly the problem is that the CAA has made it very complicated.”
He said: “The CAA would love an influx of professional trustees and has been out in the market trying to get bigger organisations to come in. But it’s so complicated – you have to be an Atol regulations geek to understand it, to know what you’re doing. That is why there aren’t many of us.”
Alcock warned: “It’s the obvious flaw in the [CAA] plan.”
The CAA has suggested a move to segregation of customer money in some form will be required in changes to the Atol scheme to be phased in from next April. It has yet to present detailed proposals, but has suggested there could be more flexibility than appeared during an initial Atol Reform consultation in 2021.
Alcock noted: “The first consultation started with a slightly moralising tone that ‘All travel companies use customer monies and that is bad. We’re going to make everybody put [the money] in a trust.’”
He said: “Is there a big enough support network? I don’t think it’s workable based on the current infrastructure.”