It seems strange to BLTF that so many foreign tourists trust
Indonesian based travel agents, online reservation sites and
tour operators when it is common knowledge SE Asian credit
card fraud is rife and comes extensively from abuse within
the travel industry. It is not just a matter of whether travel
companies and / or their staff buy their next sofa or new
TV on some unsuspecting tourist's credit card. It also includes
"bait and switch" (advertising prices they can not
honour in order to get credit card details and with a sense
of enforced loyalty when they switch you to an alternative
they can honour) and unlicensed marketing companies operating
as travel agents. Many agents also have very unfair cancellation
terms which actually mean they earn more from you if you cancel
because you get nothing back and yet they do not have to pay
the hotel; be warned!
Of course the web sites of many Bali reservation agents look
"kosher" or perhaps "halal" enough, often
showing membership to organizations which upon closer examination
are not always what they appear, such as The Pacific Asia
Travel Association (see our page: Pata?
No Thanks!). But the simple truth is Indonesian travel
agents and tour operators are historically, generally a lot
more risky to deal with in every respect, irrespective of
what impressive sounding associations they belong to.
For example, many travel agents in the west offer their customers
"bonded insurance"; a third party insurance policy
maintained by a reputable insurer to protect any monies paid
by the agents' customers in the event the agent goes out of
business. We have yet to find one Indonesian based travel
agent or tour operator that offers their customers this protection.
Some agents even go so far as to fraudulently describe the
protection they offer. One particular travel agent PT Bali
Discovery Tours says they provide "escrow" on any
money given to them; "escrow" actually literally
/ legally means the money is held in trust in that / each
customers name until they have received the goods or service
and then authorize the funds released. But what this agent
actually does is have customers' payments go into their client
bank account, which is not the same thing. We also have recorded
instances of Bali Discovery telling customers they need a
copy of their passports along with their credit card information
in order to prevent fraud, when actually the reason Bali Discovery
needs a copy of the passport is that their bank will not process
the credit card payment without it! BLTF believes the statements
made by this travel agent would quite likely end them up in
court charged with fraud in western countries, but of course
not so in Indonesia.
At least Bali Discovery Tours are registered travel agents
/ tour operators; at least we think they are. Many reservations
agents are simply travel marketing companies, which are very
easy to set up in Indonesia; at least a lot easier than registering
as a travel agent. The problem with this is that whatever
incentive there exists for true Balinese travel agents to
act ethically is somewhat diminished to perhaps the point
of lucridity when a company does not even have to be licensed
to act as travel agents by taking people's money in advance
of the customer receiving the service or goods. BLTF believes
it is a clear indictment of Indonesia's fraud and corruption
ridden system that such companies are allowed to operate.
But it does not stop there. Another favorite "trick"
is for travel agents to show hotel / villa rates they claim
include tax and service charges, but that is often not likely
or even possible. If an agent is offering a hotel room for
US$121.00 per night including tax and service, because Indonesia's
tax and service rate combined is 21%, that means the pre-tax,
pre-service charge rate is US$100 per night. So you decide
to stay one night at the inclusive rate of US$121 the agent
is going to pay the hotel staff US$11 (the 11% service charge
portion) and the Indonesian tax man US$10 (the 10% tax portion)?
What many do which is unfair even fraudulent is take the wholesale
room rate from the hotel, pay 10% tax on that (not the full
rate they charge) and pay nothing to the hotel staff; be warned
- you may think you have already generously tipped the staff,
but they may well receive nothing if you booked via an agent.
What agents often do is advertise the net rate, which does
not include service charge as this is legally an option (although
some hotels make it seem like it is mandatory), but falsely
describe it as a rate including tax and service charge.
So there you have it, Balinese travel agents are often not
even travel agents and the travel industry in Bali is well
known for its cheating ways and even fraud. We therefore recommend
that before you give your credit card information to any online
agent you first do a search for that company and "cancellations"
and "warnings" such as on Google for AsiaRooms
Warnings to check for any published problems by other
customers of theirs. If there is nothing bad there we then
recommend you ask the following questions directly to the
1) Where are you legally based?
2) What bonded insurance do you have to protect any money
I pay you in advance (please provide details of any policies
held). If you do not have bonded insurance, what guarantees
are there regarding what I pay you in advance?
3) What are your cancellation terms, specifically regarding
4) I am interested in staying ww nights at xxx hotel for your
advertised tax and service included rate of yy per night,
total = zzz. How much of that goes to to the Indonesian tax
office and how much of it goes to the hotel staff?
If they get past those well, if you want to enquire about
a particular hotel or villa with them, ask them at least to
provide current accurate availability for the hotel / villa
and the room / price you are after or even better a firm reservation
offer before you give them your credit card information. If
they reply rooms are available or they offer you a reservation
and you then provide them with your details, but they subsequently
advise you the hotel is actually fully booked; immediately
contact your credit card company and advise them not to honour
any charges from that agent, advise the agent you do not want
to do business with them and for them not to process any charges
on your card, and finally consider letting the world and BLTF
know about what they are up to!
Of course some reservations sites allow you to enquire with
and pay the hotels / villas directly, so the above does not
apply to them. But make sure you are dealing with the hotel
/ villa directly. Many agents "confuse" the issue
by providing fake email addresses (e.g. email@example.com)
which appear to be the hotels / villas direct email address
but are not. One such direct reservations site which will
provide you with the hotel's / villa's genuine email address
is our sponsor; Bali
Hotels & Villas. But be careful, they also have hotels
and villas which are (clearly marked) as prepaid wholesaler
reservations and some villa owners only deal through management
Finally, villa reservation agents! If you have read our Bali
Villas page you will know many villas in Bali are actually
unlicensed holiday homes owned by foreigners unlawfully renting
them out without an operational license. The problem is further
then compounded by reservation agents who manage the booking
and payments for these holiday homes feigning vacation rental
villas. So you need to ask the agent to provide details of
the villas pondok wisata / melati hotel operational license.
If they can not, assume the worst and realize you are potentially
exposing yourself to great risk; not only booking through
an agent but also likely with an unlicensed and probably uninsured
One Bali villas agent who has confirmed they meet all the
criteria BLTF set out on our featured sites page is Bali
Experience. If you know any more, get them to email us
confirming they conform to our featured
sites page and it will be BLTF's honour to list them too.
Please do not let BLTF's warnings stop you from looking around
for good, reliable and secure travel agents or tour operators
in Bali. Many will have been doing a superb job for many years
without insurance, but just be aware of the risks and certainly,
at the very least, try to avoid the very risky operations.