Next Time, the Governor May Have Reservations
Gov. Pete Wilson ought to check with his legal eagles before handing out letters of commendation to constituents--especially when those recipients are being sued by the state of California.
Last week, the state attorney general’s office filed charges against Nu-Concepts in Travel Inc. and its Jetaway Travel Corp. ticketing subsidiary, accusing the Irvine firms of violating numerous business laws and functioning as an “endless chain scheme.”
The action came as part of “Operation Trip-Up,” a nationwide crackdown on alleged travel fraud by the Federal Trade Commission and a dozen states. But it stands in glaring contrast to a letter sent to Nu-Concepts just seven months earlier, in which Wilson lauded the do-it-yourself travel agent network as “the pride of California.”
In the Aug. 17 letter to a couple of Nu-Concepts top officers, Wilson gushes: “In two short years, you have guided Jetaway to unprecedented growth and extraordinary success. . . . I salute you for making a profound contribution to California’s economy and vital tourism industry. You’ve helped to bring thousands of good jobs to Orange County, and set a standard of excellence that is the envy of your industry and the pride of California and Nu-Concepts in Travel.”
The letter is typical of the congratulatory missives the governor sends to constituents statewide, said Wilson spokesman Ron Low. He said the governor’s staff gets loads of requests, which are screened before a letter is sent out. “We had no reason to believe at the time the letter was sent that they were involved in any impropriety,” Low said.
But a little digging would have revealed that independent travel agent networks like Nu-Concepts have fueled a firestorm of controversy in the travel industry. The networks, which recruit armies of at-home agents to sell travel, say they represent the future of the industry. But traditional agents counter that some are nothing more than multilevel marketing gimmicks or credential “mills” that sell phony travel agent identification cards.
The American Society of Travel Agents, one of the industry’s largest trade groups, sued Nu-Concepts in May 1996 for alleged trademark infringement. The company, which claims more than 33,000 independent agents, subsequently agreed to stop using the ASTA logo on its ID cards.
Likewise, the company made big headlines in the travel trade press in late 1995 when a New York small claims judge--who also happens to be one of the nation’s foremost authorities on travel law--called Nu-Concepts a “pyramid scheme” in awarding a judgment to a woman who sued one of the company’s distributors for failing to provide promised travel agent training.
But Larry Michaels, chief operating officer for Nu-Concepts, says the guv got it right in his letter. Michaels says Nu-Concepts is a legitimate enterprise that has been unfairly targeted as part of Operation Trip-Up. “It was a big accolade to have the governor recognize us,” Michaels said. “To be tied in with these scammers who sell certificates or vacation packages is very disturbing. All we do is sell travel.”
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Marla Dickerson covers tourism for The Times. She can be reached at (714) 966-5670 and at marla.dickerson@latimes.com
