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Avoid online auction anguish: Make sure you read the fine print

By Ellen Creager, Detroit Free Press (MCT)

Thursday, July 26, 2007 7:21 AM CDT

LONG BEACH, Calif. - The grungy hotel room was reeking of smoke. The bathtub was rusty. The bedspread and furnishings were dingy relics.

But I couldn't leave.

I'd already paid $155 in an online travel auction for the Queen Mary Hotel room - $91 for the room, $20 commission, $24 in taxes and $20 to upgrade to a room with a window. I'd taken a risk. And lost.

Online travel auctions promise fabulous bargains on vacations, hotels and airfare to glamorous places, playing on travelers' desires to get a steal of a deal. Sometimes they work out wonderfully. Sometimes they don't.

"Since the beginning of man, people have always wanted more for less," says Greg Donewar, manager of the federal Internet Crime Complaint Center in Fairmont, W.Va.

"If it sounds too good to be true, beware."

Ah, the old caveat emptor.

Travel auction sites come in two flavors - nonprofit and for-profit. Some sites charge buyers commission. Some are actually travel agencies or consolidators. Others, like eBay's travel section, simply provide online auction space. Some sell last-minute unsold or even distressed products, while others specialize in high-end trips. A few are altruistic, donating your purchase price to charity.

But travel auctions, like other online auctions, are all about getting delivery of the exact product promised.

Your biggest risk in a travel auction is failing to read the fine print - blackout dates, commissions, fees, surcharges, taxes or other catches that can boost the price or lower the value of your winning bid.

Every year, complaints about online auctions top the list of reports to the Internet Crime Complaint Center, which is run by FBI and the federal White Collar Crime Task Force. In 2006, 2,600 Michiganders were victims of auction fraud (travel auctions are not broken out as a separate category), center data show.

One good piece of news? Complaints about auction fraud are slowly dropping, Donewar says. That indicates that sites are stricter and consumers are smarter.

At least, most consumers are.

In my case, I registered on www.SkyAuction.com, then looked for an interesting California hotel, settling on a room at the historic, retired Queen Mary cruise ship. I bid $12 to start for a room, then went up to $14, $30, $45 and $91. I got a message the next day telling me I'd won. Then I paid $20 to upgrade from an inside stateroom (no window) to an outside stateroom (porthole window), and the $20 commission to SkyAuction. I requested lodging dates. My credit card was charged. The reservation was non-refundable and non-changeable.

(I never checked the hotel's own rates. If I had, I would have found that its own Web site offered better rooms for as low as $99 a night plus tax.)

I'm not picky, but when I got to room A-028 at the Queen Mary, I almost cried. It was appalling. I returned to the front desk and requested something less smoky and dingy. The clerk gave me a slightly larger, non-smoking room. It, like the rest of the 350-room hotel ship, was direly in need of renovation, but at least it wasn't uninhabitable. But I couldn't understand why the hotel was in such bad shape.

Later, when I returned to Detroit, I found out why.

The Queen Mary is bankrupt.

In fact, it has been in bankruptcy proceedings for two years. Its operators owe millions to the city of Long Beach, so they're not exactly going to be springing for new stuff on the ship. Ironically, the lease to run the place is being auctioned off this summer.

The hotel gets a low grade of D from the Better Business Bureau because of complaints.

Still, Sky Auction features the Queen Mary Hotel every week on its online auctions.

Its ad says, "Guests slumber in elegant Art-Deco staterooms."

SkyAuction's president Michael Hering points out that many travel sites like Expedia and Orbitz sell rooms at the Queen Mary, too. If buyers don't do their homework or read the fine print, they have nothing to complain about, he says.

SkyAuction is the only travel auction site with an unsatisfactory rating by the Better Business Bureau, based on a pattern of complaints.

"But if you look at it, we have had only 16 complaints in the last 12 months, which is minimal out of 150,000 passengers per year," Hering says. "There are always going to be complaints when you talk about travel, because it's subjective. People don't read our terms and conditions.

"It says on our site, all auctions are not changeable or refundable. We don't give refunds. We don't guarantee that every date will be available. On airline seats, we don't guarantee every class of service."

People want both a fabulous auction deal and total flexibility, he says, but that's not realistic.

Here are the main travel auction sites. If you're smart, you may find good deals:

Luxury Link

• Luxury Link (www.luxurylink.com) is a for-profit Los Angeles-based travel agency that negotiates with high-end providers. Its Web site clearly states the retail value of the offer, lowest bid and any fees or taxes. It charges buyers a $20 commission - not much for a $10,000 trip, but a lot if you're trying to score a $79 hotel room.

Named to multiple "best of the Web" lists, Luxury Link has a satisfactory record with the Better Business Bureau.

A typical offer: Lodging at a Tuscan castle in Italy that sleeps 20. The minimum bid for seven nights' lodging is $10,699 - plus taxes, staff pay and cleaning fees of about $4,600. Retail value of the trip? $23,800.

eBay

•eBay (www.ebay.com/travel), based in San Jose, Calif., fights fraud by limiting who can sell travel on its site, said spokeswoman Kim Rubey. Vacation packages, cruises, airline tickets and trips must be sold by licensed travel agents or businesses that own travel property (an airline or hotel, for example).

Individuals are limited to selling travel vouchers or travel gift certificates and even then, they can sell only one per month. Also, the voucher must be transferable and cannot be travel club memberships or "travel choice" certificates. Under certain circumstances individuals may list a timeshare they own for rent.

EBay has a satisfactory record with the Better Business Bureau.

A typical offer: A 2-night package at Embassy Suites Niagara Falls June 10-12, with a 2-room suite, whirlpool and view of the falls. Starting bid? $350, a good deal. The same package is $416 on the hotel's Web site. Embassy Suites itself is the seller.

Sky Auction

• SkyAuction (www.skyauction.com) is a New York-based travel site that auctions hotel rooms, trips, airline tickets and more.

In business since 1999, it charges a $20 commission to buyers. It started off concentrating on airfare auctions but now offers a wide assortment of travel. It is popular with travel auction fans. A typical offer: One night at the Westin Copley Place Hotel in Boston, blackout dates apply, for $200. It could be a good deal; summer rates at the Copley run from $179 to $329 per night, depending on the date.

Generous Adventures Auctions

• Generous Adventures Travel Auctions (www.generousadventures.com) is a nonprofit based in Homer, Alaska. When you buy a trip, the company donates 100 percent of profits (about 45 percent of income) to charities.

Described by Frommer's travel guides as eco-friendly and "one of the good guys," it is the only all-travel online benefit auction. It auctions everything from kayak trips to backpacking adventures to vacations abroad. The site is not rated by the Better Business Bureau.

A typical offer: Three-day guided trek for two at Yosemite National Park, worth $1,100; high bid was $425 midway through the auction.

Bidding For Good

• Bidding For Good (www.biddingforgood.com), based in Cambridge, Mass., is a site used by many nonprofit groups to auction off trips, airline vouchers and vacations (as well as other items) that have been donated to the groups to raise money. The site is owned by cMarket, which has a satisfactory record with the Better Business Bureau.

A typical offer: Two round-trip ticket vouchers on Northwest Airlines for travel in the U.S. lower 48, offered by Hillel of Metro Detroit. The vouchers sold for $673, raising money for the Jewish nonprofit (and also possibly giving a deal for the buyer, depending on destination).

Hillel paid the site a $450 fee to run the auction, plus a 7 percent commission on items sold. The group made $10,000 to $15,000 on the auction, says Sheri Ginis, Hillel's director. "Overall, it was incredibly positive," she says.

And that's what you want with your online travel auction experience as a buyer, too - something incredibly positive.

HOW TO CUT YOUR RISK IN ONLINE AUCTIONS

Smart travelers can get deals. They can also get burned.

Before you bid, read the fine print on the site. All of it. In addition to the bid itself, what's the commission fee, other fees, taxes, blackout days and rules about refunds or changes?

Compare the auction deal with what you could get directly.

If the auction does not reveal the name of the company offering the trip, think twice.

Use Pay Pal or a credit card. Never wire money to anyone.

Remember that travel auction sites are businesses, not baby-sitters. You have to take care of details - like, do you need a passport for this trip? One common disaster for buyers of cruises is being turned away at boarding because they didn't bring proper ID.

Before bidding, check www.lookstoogoodtobetrue.com and read the section on online auctions.

If you take the trip or vacation and it does not match what you were promised, complain.

(Sources: Internet Crime Complaint Center; eBay; U.S. Federal Trade Commission.)

Ellen Creager: ecreager@freepress.com  (c) 2007, Detroit Free Press.

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