Attorney General's News Release

December 19, 2006

Judge orders Branson travel club business and its owners to pay record $1.9 million penalty for consumer violations

Forsyth, Mo. — A Branson travel business that continued to use deception and fraud in the selling of travel club memberships even after being ordered by the court to stop must now pay a record penalty of $1,950,000 after being found in contempt of court. Attorney General Jay Nixon, who obtained the order against Vacation Travel LLC and its owners, said Friday's ruling by Taney County Circuit Judge James Eiffert sends a strong message that fraud in the travel industry won't be tolerated in Missouri.

"This is a record penalty for a travel-related consumer case in Missouri, and one of the largest consumer penalties ever obtained by the Attorney General's Office," Nixon said. "It serves notice that those who use deception and fraud in connection with travel clubs can face paying a heavy price."

In his order, the judge found that Vacation Travel LLC — which did business as Vacation Travel Outlet and sold Vacation Travel Club memberships — and owners Tom Wood, Denver Wood and David Large had violated Missouri consumer protection laws and earlier orders from the court at least 390 times. He ordered the defendants to pay a civil penalty of $5,000 for each of the 390 violations.

Judge Eiffert ruled that the defendants violated two earlier consent judgments obtained by Nixon that required them to provide consumers with certain information about their right to cancel contracts and their right to obtain refunds. The defendants also failed to comply with Missouri tax laws, as required by one of the earlier court orders.

The judge's order also prohibits the defendants from ever operating, owning, working for, investing in, profiting from or "otherwise directly participating in any way" in any business that is part of the "discount travel" industry or "discount travel membership clubs" industry. The defendants also were ordered to pay the state's costs associated with bringing the legal action.

Judge Eiffert wrote, "The Court finds that all evidence and inferences proves that Defendants have continued unabated and undiminished to abuse and take advantage of consumers — primarily elderly and credulous tourists to Branson, Missouri — throughout the entire seven years they have been engaged in this line of business (while, during most of that time, ignoring or fighting against the Attorney General's claims, or this Court's orders, that they must stop)."

In February 2002, Judge Eiffert ordered the defendants to pay restitution to consumers who had paid up to $5,000 for travel club memberships in Vacation Travel Club, as well as penalties to the state. Nixon had alleged the defendants:

• Subjected consumers to high pressure sales tactics in their sales presentations;
• Made false statements to consumers that Vacation Travel Outlet would re-purchase the memberships after a certain length of time or assist them in reselling the memberships;
• Misrepresented the savings available to members of Vacation Travel Club and how easy it was to use a Vacation Travel Club membership; and
• Consistently refused to provide refunds to consumers.

"We will continue to take strong action against those who misuse a premier travel destination such as Branson as a way to take large amounts of money from consumers and deliver very little in return," Nixon said.

Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

All media inquiries should be directed to the Press Secretary.

E-mail      Phone: 573-751-8844         Fax: 573-751-5818