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SCMP Reporter

A LEADING travel agent yesterday became the second in three months to shut its doors, leaving customers without tickets, cash or passports.

   Worried clients swarmed to Observers Travel Enterprises' branches in Causeway Bay, Central, Mongkok and Tsim Sha Tsui to find them deserted.

  Police were called to the Causeway Bay office in the Hang Lung Centre to calm more than a dozen angry customers demanding refunds.

  The panic began after Observers Travel told the Registrar of Travel Agents it no longer wanted to operate as a travel firm.

  The registrar issued a notice of intent to revoke the company's licence.

  A Registry spokesman said the company, which had been in business for 15 years, had no financial problems when its licence was last renewed.

  Mera Travel, which specialised in adventure tours, folded in April.

  Observers Travel, which specialises in family-orientated package tours, must tell the Registrar before June 18 if it wants to keep its licence.

  Many of the angry customers said yesterday they were among 200 due to depart for Japan, Australia and Hawaii.

  Another, who gave his name only as Mr Cheng, said he paid $40,000 on Friday for his family's European trip. He was outraged that the company had accepted his money the day before closing.

  'This is a fraud. They should have known they were going to close a week ago, but still they rang me up to tell me to pay,' he said.

  One man said he had come to reclaim $6,900. Another said his main concern was his passport, which was with the firm and awaiting a visa.

  The company advertised huge reductions in fares in Chinese newspapers on Friday, including discounts of up to $2,500 on trips to New Zealand.

  More than 20 smaller agencies have closed this year, and about 80 folded in 1995.

  Legislative Councillor Howard Young said the industry was becoming cut-throat, with more than 1,000 agents.

  'The number of agents is up, but profits have been down and tour prices have not been rising to match inflation,' Mr Young said.

  'Unfortunately we are about to hit the peak season, and this is an incident which involves a major agency. But I don't predict that there will be more agents following suit.'   A Travel Industry Council spokesman said customers would be eligible for up to 80 per cent compensation, provided the five per cent surcharge, which insures against defaults, was paid on their tickets.



Fury as travel agency closes