TICO Delivers Comp Fund Fee Increase Bombshell:
336% Increase Planned Over Next 2 to 3 Years
Paying the Piper For TICO's Incompetence
Toronto, 20 September 2010: Canada's Association of Retail Travel Agents (ARTA Canada) stood in awe today of TICO's freshly minted Business Plan 2010. As ARTA Canada had predicted long ago, TICO revealed plans last week to increase payments by Ontario travel companies into the Ontario Travel Industry Compensation Fund by 249% next year and 336% the following year, compared to today's fund contributions - seeking to extract $2.2 million from Ontario travel companies.
Does that number sound familiar? Wasn't that the amount of TICO's "secured" claim in the Conquest bankruptcy matter?
"Did travel agencies really think this money would be coming from somewhere other than their own pockets? It's all fine and well for TICO to say 'we brought them home safe and sound'. Laudable, but not enough. How about trying to prevent these failures with better scrutiny and controls in the first place? How many other travel companies are non-compliant with trust accounts, working capital, and industry regulations?", asked ARTA Canada President Bruce Bishins.
TICO's increases defy explanation, particularly given that the compensation fund is already at a healthy, near $25 million level. What makes Ontario travel agencies cringe is that TICO has refused to share actuarial reports which make recommendations as to fund levels, and the fact that TICO is trying to top-up a fund in advance of major failures, which would be limited to $5 million per event anyway.
In its business plan, TICO goes on the defensive by stating that "less than 5% of registrants with working capital or financial statement compliance issues result in claims against the Compensation Fund." However, ARTA Canada says that's skewing the truth and not the measure of any real or meaningful analysis as it should be the dollar volume of failures attributable to compliance issues, not the number of agencies.
TICO essentially confirms that the increases will take place as planned, and that other fees will be reviewed as well, though any increases require actual TICO board approval.
Adding insult to injury, TICO also states that it will "explore the development of turn-key solutions for self-management and consumer protection that can be sold to other jurisdictions and/or industries."
"What!? Is this TICO's mandate in consumer protection? Shouldn't TICO be spending its time and resources in improving consumer protection in Ontario before it starts selling its questionable expertise to third parties? Talk about the blind leading the blind!", added Bishins.
For a copy of TICO's 2010 Business Plan, please click here.
ARTA Canada urges all registrants to attend the 01 November 2010 TICO AGM at 4:00PM at the Toronto Congress Center, 650 Dixon Road, Toronto.
About ARTA Canada
ARTA Canada is the largest non-profit federally incorporated professional association of travel retailers in Canada, the members of which consist exclusively of travel agencies and travel agents. In addition to advocating fair and equitable treatment of travel consumers, ARTA Canada represents the commercial and strategic interests of its member travel agencies and travel agents in a variety of national and provincial domains including regulatory and legislative matters, automation, technology, sales and marketing, and distribution.
ARTA Canada is the strategic partner in Canada of the U.S.-based Association of Retail Travel Agents (ARTA). ARTA Canada is the Canadian member of UFTAA, the United Federation of Travel Agents' Associations. To join ARTA Canada, complete details and online membership application and secure payment are available on the ARTA Canada web site at www.artacanada.ca/join.