Freedom Direct collapse affects thousands

Late last week, the online travel provider ceased trading.

Travel Insurance News - 20/04/2009

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The firm, earlier in April, failed to renew its ATOL licence.

It had a workforce of around 100, and the Civil Aviation Authority (CAA) has estimated that 200 of its customers are currently on holiday abroad, while nine to 10 thousand have pre-booked holidays with the travel company.

Industry experts estimate that the cost of the firm’s collapse to the CAA Air Travel Trust Fund will be approximately £2 million. Freedom Direct Holidays held an ATOL bond of £750,000.

A spokesman for the CAA said that it was too soon to make an exact calculation about the cost to the fund, but that the estimate of £2 million was a "sensible one".

He added that the Freedom Direct case was complicated by the fact that the majority of its business was as a retail travel agent and not a tour operator, and that the retail customers were not ATOL-protected. Additionally, customers who booked holidays in the past three weeks, after the firm’s ATOL licence expired, are not covered either.

The Newcastle-based travel company also traded as Freedom Direct, holidaysyoulike.com, holidaysyoulike.co.uk, snowdeals.co.uk and hotsunholidays.co.uk. It has posted a notice on its website advising its customers that it has ceased trading.

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