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Travelers keep falling for ‘free’ cruise schemes. Here’s how companies get away with it

Bahamas Paradise Cruise Line’s Grand Celebration ship. The company works with more than 100 travel companies who market cruises, some of them “free” cruises.
Bahamas Paradise Cruise Line’s Grand Celebration ship. The company works with more than 100 travel companies who market cruises, some of them “free” cruises. mlambert@miamiherald.com

Nearly everyone is familiar with the call: A too-good-to-be-true offer for a “free” cruise, promising a stress-free Caribbean getaway — as long as you BUY NOW.

But it’s when would-be travelers actually start to look at the details of their “free” vacation that things can get messy.

Available dates may be severely limited. The seller may try to add on a hotel stay — for a price. Travelers may find out they’ll need to first sit through a timeshare presentation or pay government taxes or port fees — despite the prohibition by Florida law that the only allowable charge for a prize is the cost of delivery.

And those who cancel may find getting a refund to be nearly impossible.

When you start asking those questions and thinking about the hoops you have to jump through, the hassle might outweigh the ‘free’ cruise part.

Colleen McDaniel, senior executive editor at Cruise Critic

“When you start asking those questions and thinking about the hoops you have to jump through, the hassle might outweigh the ‘free’ cruise part,” said Colleen McDaniel, senior executive editor at Cruise Critic, a cruise review website that has seen numerous complaints about “free” cruise offers.

Still, many travelers bite, lured by a steeply marked-down vacation. All too often, such “free” travel offers can be deceptive schemes perpetrated by Florida-based companies trying to piggyback on South Florida’s status as the Cruise Capital of the World.

And, granted, some discounted voyages have yielded positive experiences.

Facebook user Kelly Faust Ray said on Cruise Critic in the summer of 2017 that she had a “great time” on her “free” cruise. According to her post, she paid $29 a night plus taxes for a hotel stay in Fort Lauderdale, $15 for three daily buffets for two at the hotel, plus tax and gratuities, and government taxes and fees on the cruise.

“We did have to go to a [90-minute] timeshare presentation — we were out in [90 minutes]. How we figure it is this: We don’t make $300 at our jobs in [90 minutes], you don’t get something for nothing,” she commented. “[Ninety minutes] out of our day is doable.”

celeb sunning
In this Miami Herald file photo, passengers sunning poolside on the Grand Celebration in 2009. Marjie Lambert mlambert@miamiherald.com

But in many instances, such “free” travel deals turn into trouble for consumers: Last year, the Florida Department of Agriculture and Consumer Services received 1,028 complaints about travel or vacation plans, making it the No. 8 most common complaint. The department characterizes “free” cruise deals that require travelers to pay additional fees as travel scams.

Online message boards, forums and social media sites are also rife with consumer posts complaining about “free” cruise schemes or seeking answers about offers they received.

A 2010 post on maritime lawyer Jim Walker’s Cruise Law News blog about Caribbean Cruise Line, a travel agency that allegedly sells “free” cruises and has been sued in a class action lawsuit, spawned a 72-comment spree that spanned six years, through August 2016. The company, not related to major line Royal Caribbean Cruises, has an “F” rating from the Better Business Bureau.

The majority of the complaints on Walker’s site referred to the business practices of Caribbean and similar firms. An editorial post about Caribbean’s practices on the popular site Cruise Critic drew 84 comments. Facebook is home to a number of complaints about “free” cruise deals. As is Twitter.

“Got a phone call telling me I won a free cruise today. Was cautiously optimistic for a few moments. Obviously a scam. Can’t answer unknown numbers,” tweeted user @Jamie_Thompson in November.

How it works

The scheme typically begins with a phone call telling the listener that he or she has won a “free” cruise, or asking the consumer to participate in a political survey. Some start with a post shared on Facebook, a text message or a mailer.

Some travelers take the deal — often only to rethink it when they can’t book a date that matches their schedules or when they find out about additional fees.

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A fake advertisement for a “free” Carnival Cruise Line cruise — just pay taxes and port fees — for victims of the 2017 hurricane season was posted on Facebook and debunked by British Carnival cruise director John Heald.

When they try to cancel for a refund, they find themselves trapped in a complex web of companies working together to market the “free” cruise, handle the booking and charge consumers — making it difficult, if not impossible, to secure reimbursement. In most cases, none of those companies is the actual cruise line.

While the issue is not new, several consumers recently reached out to the Miami Herald about problems with “free” or discounted cruise deals. Among them was Rebecca Wood, a retail worker from Port Wentworth, Georgia, who was planning to sail on an early October voyage on Bahamas Paradise Cruise Line. The one-ship (soon to be two) Fort Lauderdale-based line operates two-night voyages between the Port of Palm Beach and Grand Bahama Island.

Wood and her boyfriend, Spencer Brown, said they received multiple unsolicited calls for a discounted cruise vacation — with the caveat that they’d have to sit through a timeshare presentation. The callers said they were representatives of Bahamas Paradise Cruise Line, Wood said. But the phone numbers were actually associated with a Tampa-based travel agency called Blue Star Cruises. (Wood has filed a complaint with the state of Florida.)

During the booking process, in December 2016, agents at Blue Star gave the couple a different number to call if they had questions, Wood said. It belonged to Orlando-based Grand Celebration Cruises.

1,028 Number of complaints about travel or vacation plans to the Florida Department of Agriculture and Consumer Services in 2017

Grand Celebration Cruises’ name was similar to the name of the ship the couple was booking — the 1,900-passenger Grand Celebration, owned by Bahamas Paradise Cruise Line. But the firm’s name actually belonged to an inactive company in Florida. Grand Celebration Cruises was in operation for only four months in early 2017, according to state records.

Thinking they were being contacted by the cruise line, Bahamas Paradise, Wood and Brown went ahead with the $428 reservation.

Then, shortly before the couple’s sailing, the trip was canceled. Bahamas Paradise Cruise Line’s ship was chartered by the Federal Emergency Management Agency to house hurricane relief workers in St. Thomas from Sept. 23 to Dec. 23. As a result, all the voyages in that time frame were canceled.

The cruise line promised via a news release to refund affected travelers, so why were Wood and Brown struggling to get their refund?

This whole time we thought we had booked directly through the cruise line. It was extremely misleading.

Rebecca Wood, retail worker from Port Wentworth, Georgia

Although they didn’t know it when they booked, they were dealing with four marketing companies at once. None of them was the actual cruise line, Bahamas Paradise.

Blue Star Cruises called offering the discounted cruise. Fort Lauderdale-based Reservation and Fulfillment Services, Inc., emailed the itinerary. Fort Lauderdale-based Royal Seas Cruises emailed the notice that the cruise was canceled. And the now-defunct Grand Celebration Cruises billed them.

“This whole time we thought we had booked directly through the cruise line,” Wood said. “It was extremely misleading.”

She said she spoke to multiple representatives at Reservation and Fulfillment Services, for which she had contact numbers from email correspondence regarding her itinerary. The options offered: to take an all-land vacation in Florida, take a ferry to the Bahamas, or reschedule the cruise for another date within the next six months — but pay the port fees again.

“We said, ‘None of these options are going to work for us, we want our money back.’ And [the representative] said, ‘Well that’s not going to happen,’ ” Wood recalled. “They said, ‘You paid a discounted rate.’ I said, ‘What I paid shouldn’t matter. I’m not the one that is canceling the trip.’ 

Wood was caught in what experts allege is a tactic that is tried on hundreds, if not thousands, of travelers every year. The players involved in this complicated scheme may change, but the strategy remains the same.

You have entity A, the cruise line; entity B, the travel agency; and entity C, the fulfillment company. If something goes wrong with the trip, there is some finger pointing, some shoulder shrugging, but nobody is going to get a refund.

Christopher Elliott, a consumer advocacy expert

“It’s all about plausible deniability,” said Christopher Elliott, a consumer advocacy expert who has helped many travelers unravel these kinds of schemes across the travel industry. “You have entity A, the cruise line; entity B, the travel agency; and entity C, the fulfillment company. If something goes wrong with the trip, there is some finger pointing, some shoulder shrugging, but nobody is going to get a refund.”

In Wood’s case, every company involved in the couple’s reservation had behind it a string of complaints and unsatisfactory ratings from the Better Business Bureau. The exception is the cruise line itself, Bahamas Paradise Cruise Line, which has no rating with the Better Business Bureau but three stars on Yelp.

Blue Star Cruises, a nearly 2 1/2-year-old company, has an “F” rating from the bureau and 46 complaints. Reservations and Fulfillment Services, Inc., established in December 2014, has scored a “C-”. Royal Seas Cruises, also established in December 2014, has an “F” rating and 207 complaints filed against it in what the Better Business Bureau has identified as a pattern of similar grievances. Grand Celebration Cruises, in operation from February to June 2017, has a flunking grade with the bureau, too, an “F,” and 35 complaints.

But like most consumers, Wood didn’t check the companies out before she booked, because she had no reason to know they were involved — until later.

royalGrandsidebyside
Side-by-side screen grabs of Royal Seas Cruises and Grand Celebration Cruises’ websites, which are very similar in design. Both companies are based in Florida and offer “free” cruise deals.

When asked about Wood’s reservation, Royal Seas Cruises vice president Melissa Hanson said via email that Wood and Brown, who made the reservation, “is not and has never been a customer of Royal Seas Cruises, so we have no information relating to them.”

Emails provided by the couple to the Herald tell a different story. One, from Royal Seas Cruises, the marketing firm, cited the couple’s reservation number and was signed by the company with a street address matching the one for Royal Seas documented in state records. The server address from which the email was sent, royalseascs.com, re-directs to royalseascruises.com.

“I see that the customer received an email that referenced Royal Seas, but that does not mean that it was sent by Royal Seas,” Hanson said. “I am confused as well, but as I said earlier, this is not our customer.”

The other companies involved in Wood and Brown’s reservation — Blue Star Cruises, Reservations and Fulfillment Services, Inc., and Grand Celebration Cruises — did not respond to several requests by the Miami Herald for comment.

I see that the customer received an email that referenced Royal Seas, but that does not mean that it was sent by Royal Seas. I am confused as well, but as I said earlier, this is not our customer.

Melissa Hanson, vice presdient of Royal Seas Cruises

In October 2017, Wood and Brown filed a complaint with the Florida Department of Agriculture and Consumer Services against Reservations and Fulfillment Services, Inc., according to records from the department.

But the agency pursued a case against the cruise line, Bahamas Paradise, instead. After multiple attempts to reach the cruise line with no response, the case was closed Jan. 26, state documents show.

The case was reopened this month, the department said, but against the company with which Wood originally lodged her complaint: Reservations and Fulfillment Services, Inc.

She has yet to secure a refund.

Fighting ‘free’ cruise offers

Wood’s next step: Consider filing a lawsuit. But she and other victims face challenges there, too.

Most maritime lawyers don’t take on “free” cruise deal cases because the amount of money involved doesn’t justify the legal costs of hiring an attorney, said three Miami-based maritime attorneys.

“Unless you’re dealing with a case on a class-action basis, it’s hard to justify the time and tremendous expense of litigation,” said Michel Winkleman, a maritime lawyer with Miami-based Lipcon, Margulies, Alsina and Winkleman. “That’s part of a broader problem with corporations in general where they are taking advantage of individual consumers on such a small basis and it makes it difficult for lawyers to seek recourse for them.”

Unless you’re dealing with a case on a class-action basis, it’s hard to justify the time and tremendous expense of litigation.

Michel Winkleman, maritime attorney

Major cruise lines allegedly have been involved, too. A 2012 class action lawsuit that claimed Carnival Cruise Line, Royal Caribbean International and Norwegian Cruise Line authorized Resort Marketing Group and related companies to make recorded robocalls offering “free” cruises, reached a settlement of up to $12.5 million in 2017.

Because the defendants were major corporations, Chicago-based Burke Law Offices and Massachusetts-based Broderick Law and Law Office of Matthew P. McCue stand to share as much as nearly $4.4 million in fees and costs, although the court has yet to award legal fees.

Also as part of the settlement, consumers who received unwarranted phone calls could be awarded up to $900 for the calls if they filed a claim.

Some other class action lawsuits dealing with similar issues also have been successful. A 2012 case against Caribbean Cruise Line, the Fort-Lauderdale based travel agency, claiming the company was robocalling an estimated 900,000 people with political surveys and then offering them a “free” cruise, ended in a settlement of up to $76 million. People affected were entitled to $500 per call.

Several lawsuits have been brought against some of the companies involved in Wood’s case for allegedly offering “free” cruise deals.

A similar case against Caribbean brought on in 2015 by the Federal Trade Commission and attorneys general in 10 states, including Florida, ended in a permanent injunction for some of the companies that assisted Caribbean Cruise Line in running an illegal telemarketing campaign. According to the complaint, consumers were flooded by literally billions of robocalls — and “free” cruise offers.

A class action suit brought by two other consumers, Leshia Baxter of Arkansas and Arthur Keshishyan of California, on behalf of others who have claimed they received unsolicited calls was filed in July 2017, initially against Grand Celebration Cruises and Blue Star Cruises for allegedly making the calls and offering a “free” cruise package in exchange for taking a political survey.

“This is a scam,” the complaint alleges, “which, as the Washington Attorney General’s Office has described, involves ‘the patent illegality of commercial robo-calling and misrepresentations that it’s a political poll.’ Not only is the ‘free’ cruise not free, the survey is simply a marketing tool with no legitimate political basis.”

The lawsuit has yet to be resolved. Also still unresolved are three class action lawsuits against Royal Seas Cruises, all filed between May 2017 and January 2018, which include similar allegations of unsolicited calls for “free” cruises.

In these seven cases and others that draw consumer complaints, patterns arise: Some of the companies, whether cruise line or travel agency, are represented by attorneys in a single law firm; some have common management.

Case in point: In a September 2016 deposition for a personal injury case, Edward Norman Levitan, former executive vice president and chief financial officer at Bahamas Paradise Cruise Line, highlighted the relationship between some of South Florida’s small cruise lines that offer quick trips to the Bahamas.

According to Levitan, some of the same individuals who owned cruise company Imperial Majesty Cruise Line also later held ownership in Celebration Cruise Line — a cruise line with an “F” Better Business Bureau rating — before both companies closed after issues with their ships.

Some of those same individuals then started Bahamas Paradise Cruise Line, bringing with them 50 to 60 percent of the former employees of Celebration Cruise Line, Levitan said. Bahamas Paradise retained the reservation-processing software used by Celebration.

Cruise lines typically work with many agents or wholesalers to market their sailings. At the time of the 2016 deposition, Bahamas Paradise had contracts with approximately 70 wholesalers to market its cruises. Glenn Ryerson, former executive vice president for sales and marketing at Bahamas Paradise Cruise Line, put that number at more than 100 in a November 2017 Miami Herald interview. Among them, Ryerson said, was Royal Seas Cruises.

The companies that market cruises on Bahamas Paradise Cruise Line benefit from the fact that they can set the price of the voyage for the consumer by choosing what commission to tack on.

But with major cruise lines, consumers generally pay the same price, whether they book directly with the company or with a travel agent, and prices are widely advertised. The cruise line pays the travel agent a preset commission, typically 15 percent.

The four major cruise companies — Carnival, Royal Caribbean, Norwegian and MSC — all have plans for new technology that over the next decade will transform cruising into an easier, line-free experience.

Like some other smaller lines, Bahamas Paradise allows the booking entity to set the price — and choose what commission it gets — as long as the cruise line gets its share.

“So we quote them a specific net rate and they sell it for whatever they can sell it for and, you know, included in packages that they promote as travel packages and/or some of them just sell just the cruise itself,” Levitan explained in the deposition, taken by maritime attorney Winkleman.

Why this persists

So if such practices are known to occur, creating problems for many consumers, why do these companies persist?

In part, it’s because the lawsuits that are filed generally name only the companies involved, and not the individuals who own or run them. Most businesses are registered as a corporation, partnership or limited liability company for tax purposes and to protect the owners against personal liability in case of legal proceedings.

“Part of the reason you set up a corporation is to insulate yourself from personal liability,” Winkleman said. “If there is nothing to go after in terms of insurance and assets, then no lawyer is going to take your case. These small little fly-by-night companies, they are [sometimes] nothing more than office space and a phone, so when they are committing wrongdoing, there is essentially nothing to go after.”

A company may be shut down, but the individuals who run it are insulated, and can start a new company running a similar operation.

Most of the class action suits target companies for breaching the Telephone Consumer Protection Act, which restricts telemarketing calls and requires telemarketers to get written consent from consumers before robocalling them. As a result, the company may be shut down, but “the individuals can take all their assets and move them to a new company,” said Elliott, the consumer advocate.

All they need to do is file the new company name and articles of incorporation or organization online at sunbiz.org. The cost: between $70 and $160.

The government’s powers are also limited.

The Florida Attorney General’s Office’s Consumer Protection Division, which gets many of the complaints, has only civil enforcement duty and can’t press criminal charges against individuals.

And though the state attorney’s office may be able to pursue criminal charges, there isn’t much incentive for them to do so.

“Think about how low in the totem pole this is for them,” Winkleman said. “If they are dealing with murders and rapes, this is really at the bottom of the totem pole for them.”

“Free” cruise deal cases involve relatively small amounts of money, too, so they are rarely brought by police to the attention of the state attorney’s offices, said Jeff Marcus, chief assistant state attorney in Broward County, home to several of the companies involved in Wood’s case.

“I don’t know that it’s ever been presented to us as an investigation being done by police,” Marcus said.

If the amount of money involved is small, a single incident may not be severe enough to be a criminal action, he said.

Chabeli Herrera: 305-376-3730, @ChabeliH

A Missouri couple on their honeymoon said they could not use the bathroom in their cruise cabin aboard Carnival Cruise Line's Carnival Triumph because of "black sewage," smelling of poop, that would bubble up out of the shower drain.

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