FTC goes after LV company in travel fraud crackdown

Wednesday, Aug. 4, 1999 | 11:17 a.m.

The Federal Trade Commission has obtained a court order to freeze the assets of a Las Vegas company accused of selling fraudulent telemarketing vacation travel packages nationwide.

The federal agency Tuesday alleged Resort World, 1050 E. Flamingo Road, advertised, via fax, exceedingly low air fares for round-trip tickets to Hawaii or Cabo San Lucas, Mexico, which included a bonus complimentary vacation, such as a cruise to Mexico or a trip to Las Vegas.

Consumers who called a toll-free number were told Resort World would sell the airline tickets at the reduced price, only on condition the individual buy a minimum of four tickets and book an eight-day, seven-night stay at a hotel through Resort World.

The agency said the customers frequently found out the packages did not include lodging at competitive prices, and that Resort World did not fill the travel needs of the customer in a timely manner, if at all.

Jerry Steiner, a staff attorney with the FTC, said 38 complaints had been received through June on Resort World, which focused most of its fax marketing plans to West Coast businesses.

Steiner said a temporary restraining order freezing assets and closing the company was approved in U.S. District Court in Las Vegas and a hearing on an injunction is scheduled Aug. 17.

Air fares as low as $100 were offered on flights to Hawaii, Steiner said, but the company required a seven-night stay at a hotel "starting at $60 per person per night." But Steiner said packets were delivered to customers requiring an additional mailing to verify lodging and rates quoted were considerably higher.

In some cases, Resort World's verification was received too late to make lodging arrangements, Steiner said.

Frank Abatangelo, who operates Resort World, disputes the FTC's charges. He said today that he wants to consult with his attorney before making a statement about the specific charges.

The state Bureau of Consumer Protection said it assisted the federal agency in shutting down the company.