An activities booking business, The Maui Fun Co., has closed, leaving behind possibly more than $100,000 in debts to activity providers, from downhill bike operations to luaus.
"This is a black eye for the visitor industry. It's devastating and can easily ruin a visitor's vacation when their pre-bought tickets are not honored due to the theft of a middleman," said Toni Marie Davis, executive director of the Activities & Attractions Association of Hawaii. The association's members are among those affected.
In a poll of association members who did business with Maui Fun Co., the businesses reported being owed more than $160,000, Davis said.
She added that "adding salt to the wound" is that the company's website www.activitysaversmaui.com is still active on the Internet.
In a Sept. 16 letter, Tim and Elsie Brink of Maui Fun Co. and Activity Savers Maui tell businesses that "it is with deep regret and profound sadness" that the company has closed because it was unable to secure financing.
All necessary paperwork associated with the closing is being filed with the state Department of Commerce and Consumer Affairs and with the federal government, the letter said. It referred questions to Wailuku attorney Michael Collins.
Recorded messages on the company's phone numbers refer questions to Collins. They say the company is no longer taking reservations, modifications or cancellations.
Collins did not return phone messages seeking comment.
DCCA spokesman Brent Suyama said in an email that an investigation was opened after the department's Regulated Industries Complaints Office received a complaint about Maui Fun Co. He said he could not comment further because the investigation was ongoing.
Davis said she did not know how Maui Fun Co. operated, but she said normal procedures would have customers booking activities and paying for them on the activity desk's website.
The activities desks hold the money until the activity providers render the services and then bill the activity desk.
The Maui Sunriders bike company is one Maui activity owed "a few thousand" dollars, according to owner Paolo Baricchi. And it's not the first time an activities desk closed suddenly, he said, adding that the state should toughen its regulations on such businesses.
What would make the process better is if the booking desks referred customers directly to the businesses and from there the businesses would accept payment for the activities upfront, Baricchi suggested. Then the activity business would pay the activities desks a commission, he said.
He added that customers should be wary of some third-party bookings, some of which may be more interested in making a commission, instead of acting in the customer's best interest.
For example, he said that when customers call his business, they are screened to determine if their physical condition and ability are good enough to ride a bike. If not, they are told they should not do the activity.
But some third-party activity desks may book customers without screening them properly, he said.
Davis said it is important that activities businesses be proactive and make sure activity desks pay them in a timely manner. If not, complaints should be filed with the DCCA, and businesses should not accept the activity desk vouchers, she said.
She added that licensed activity desks should have a trust account for the protection of both the consumer and activity provider, according to Hawaii law.
Hawaii Revised Statutes address activity providers and activity desks. And the law requires that all money paid by any person to an activity desk for activities by an activity provider shall be held in trust for the benefit of the person making the payment and the activity provider.
It also says the activity desk shall not encumber the amounts in trust and shall not withdraw money from it, except for instances such as refunds and sales commissions.
Davis encouraged businesses that are owned money from Maui Fun Co. to file a complaint with the DCCA.
She added that activity providers in an "attempt to save the aloha" are extending heavily discounted prices to the Maui Fun Co. victims when they rebook an activity.
* Melissa Tanji can be reached at firstname.lastname@example.org.