Traveland.com looked like a solid travel agency. But Sandra Baker and dozens of other travelers found the ground was more than a little shaky when Traveland's abrupt disappearance nearly stranded them in Cusco, Peru, in the middle of a trip.
"On the bus at 8:30 or 9:00pm, the tour guide announced that Traveland had paid them some money but... basically, we were on our own," she said, as the local tour operator Rainbow Tour and Travel demanded checks to pay for the next night's accommodation and flights back to Lima.
"We were hostages," she said.
And they weren't the only ones left on their own. Traveland didn't pay Rainbow "one U.S. cent" for the entire group, Rainbow spokeswoman Melissa Loreno de Duran said in an email. "They kept those customers' money, and they sent us a huge problem," she wrote.
That was in 2007. But the situation isn't antique. Businesses—even reputable ones that diligently pay their subcontractors on the ground—can run out of steam and run out of cash.
It happened again just last week, when smarTours, an affordable tour operator that had been in business for nearly 30 years and had collected money for upcoming trips in 2025, abruptly announced with a one-page website announcement that it was "no longer operational," leaving customers searching for ways to get refunds.
So how can you avoid booking with a travel vendor in trouble, and what can you do if yours goes bankrupt?
Book with a credit card.
This is the best piece of advice on our list. Using a credit card guarantees you certain protections. Paying with money transfers doesn't.
The venerable Fair Credit Billing Act, passed by the U.S. Congress in 1974, lets you get your money back if someone who charged you doesn't deliver—for instance, if you paid a travel agency and it didn't pay your hotel.
If you can no longer settle the matter with the vendor (say, if it has ghosted you), you can bring the matter to your credit card issuer and tell them you were charged for services that were never rendered.
But if you paid with Venmo, PayPal, by transfer, debit card, or any other money-sending service, you do not have that protection. So always, always pay with a credit card, and do not allow any legitimate business to talk you into cash transfers instead.
Get real details about the business.
Make sure you have a real business name, the principal owner's name, a physical business address, and a non-800 telephone number.
This doesn't apply to big guns like Expedia, which because of their size and importance are generally easy to find.
But for smaller agencies, if something goes wrong, knowing the real details—not just a website or phone number—can help you work with your state attorney general's office to get refunds and payback.
Check its memberships.
Being a member of a reputable trade group doesn't guarantee a business isn't run by a scam artist, but it shows a level of seriousness and likely accountability that it's good to have.
See if your agent belongs to at least one of these organizations, which set standards for their members and may provide leads for more contacts if things go south:
• United States Tour Operators Association (USTOA) (www.ustoa.com)
• National Tour Association (NTA) (www.ntaonline.com)
• American Society of Travel Agents (ASTA) (www.astanet.com)
• A Certified Travel Counselor certificate from the Travel Institute (www.thetravelinstitute.com)
Traveland.com didn't have any of those certifications, which was a warning sign.
But smarTours was a member of USTOA, and its membership provided protection for its customers. As a result, "purchases of smarTours products made on or prior to January 31, 2025 may be protected under the USTOA $1 Million Travelers Assistance Program,” as USTOA president and CEO Terry Dale told Travel Weekly.
Check with the local Better Business Bureau.
Always check reputations before you hand over a penny. A legitimate travel agent would tell you where their primary place of business is located. And you'll need to have the name of that that city if you go to https://www.bbb.org/search to see if other customers have complained and whether their disputes were resolved. Traveland.com had a pretty awful record in Mission, Texas.
But you'll need to be careful about using this method, because in 2007, the California BBB had records for several companies that also used the name "Traveland," and none of them were the one that stranded travelers.
You can also check web-based review sites such as TrustPilot.com, although the BBB has a longer track record for integrity.
Buy third-party travel insurance.
Buy insurance for your trip that includes trip cancellation. According to Allianz, one of the biggest players in the U.S. travel insurance biz, "The financial default of a travel supplier can be a covered reason for trip cancellation."
For this to work, you must buy your insurance policy within 14 days of your first payment or deposit, and you must buy your insurance from a business other than the vendor in question.
That's right—decline the insurance offered to you by your travel company during the booking process, and obtain the policy independently. That isn't just something that many insurers will require. It will also give you another number to call if your vendor stops responding.
Your credit card may also offer you trip cancellation protections as part of its standard benefits. Do you know if it does? Check. If you have multiple credit cards, use the one with the best guarantees for every payment you make for travel.
Insurance doesn't just help you get your money back. Travel Guard's policies, for instance, can come with a 24-hour concierge service that can help you find a hotel and transportation if a fly-by-night agency leaves you stranded far from home. Beyond simply sending you refunds, they can also get you back home at no expense to you.
Frommer's has a list of reputable travel insurance companies right here on this site.
Ask if insurers cover that company.
Sometimes, travel operators have such poor reputations that insurance companies won't touch them. If a mega-insurer like AIG Travel Guard won't sell you insurance for a trip purchased from a given agency or tour operator, take it as a warning. If insurance companies are aren't willing to risk their money, should you be?
Check Travel Guard's alert list at https://www.travelguard.com/help-center/alert-list and make sure your agency isn't on there.
This rule doesn't hold for airlines, who use bankruptcy as a tool to renegotiate contracts.
Double-check bookings.
If an agency says it paid an airline or another major transportation service, then it should give you a confirmation number, and you should be able to verify that it's a confirmed ticket.
Unfortunately, that doesn't mean you'll be allowed to take control of that flight booking if the agency fails you. When an agent books your flight for you, the airlines often consider the agency to be their customer, and not you. But if you have travel insurance that covers it, you'll be able to book another ticket to get yourself out of the mess and be reimbursed for it.
Check for protections from local government.
In California, check on the California Sellers of Travel website at https://oag.ca.gov/travel to see whether the company has filed with the state's travelers' restitution fund. That gives you a last-resort option if your credit card company and insurance don't come through.
In British Columbia, Consumer Protection BC has a similar Travel Assistance Fund (TAF) at https://www.consumerprotectionbc.ca/consumer-help/didnt-get-travel-services/ for just this kind of disruption.
And in the European Union, regulations protecting travel consumers are extensive and specific.
Ask your local state or province if it operates groups that can help. And if it doesn't, ask your elected representatives why not. Other governments do it as standard practice.
Additional reporting by Sascha Segan
