The judge presiding a case where Fantasy Tours is seeking a declaration of bankruptcy after cancelling clients' holidays told the owner today: "How can you recover your self-esteem?"..... "How can you face these people?".

Mr Justice Joseph Zammit McKeon addressed his comments to Karl Azzopardi, who took to the witness stand to testify about the financial situation of the company.

Questioned repeatedly by the judge about why he took clients' money only to declare, the day after, that he could not honour the holidays, Mr Azzopardi said he had continued to hope that, one way or another, the company could continue to operate.

He explained how he had taken over the company in 2009 when it had debts amounting to between €400,000 and €500,000. 

He had not been aware of the extent of the financial problems, but when he found out he still wanted to keep the company going.    

He had found that Air Malta was owed €132,000 and a payment schedule was agreed.

The judge asked him whether he had checked what he was getting into before purchasing the company.

Mr Azzopardi said he was in hospital, and when he got out, it was a case of keeping going, or closing the company.

The company started to recover in 2010 and was also recovering in 2011.

At the beginning of last year he was diagnosed with cancer, and he was in hospital when he was told that the Consumer Affairs Authority had issued a public warning about Fantasy Tours.

Between 2008 and the present, 150 complaints about Fantasy Tours had been made to the Authority, but one had to consider that there were 1,900 complaints against tour operators as a whole, Mr Azzopardi said.

He said he had decided to pay every client who complained in order to protect the good name. Yet Fantasy Tours continued to show up on the internet after the Authority's public warning

"It had a very negative affect on us." 

The situation was also made worse by the crisis in Greece, which caused suppliers there, including hotels, to request cash payments.

Bookings to Corfu', the company's main market, declined, and losses mounted. Many would-be clients said they would not book because of the Authority's warning.

The SMS informing clients that their holidays had been cancelled was issued on August 7. Mr Azzopardi said he had called the offices and stopped all bookings. The last payment received by the company from travellers was on August 6.

Asked why he had continued to receive payments, Mr Azzopardi said he needed the money to operate.

A few days before, he had deposited €30,000 of his own money in order to keep the company going.

"I tried everything, I even approached SMS, Britannia Tours and Mondial inviting them to invest in the company, but they turned us down," he said.

The Judge said he still could not understand how the company continued to take money from its clients right up to the very last day before the SMS was issued.

Mr Azzopardi admitted he had continued to take the money.

The judge replied by asking Mr Azzopardi how he expected to get his self esteem back, and how he could face his clients. 

Earlier today, evidence was also given by auditor Paul Marmara'. He said that after the collapse, he was asked to audit the management accounts from 2009 to the present.

He said some information still needed to be given by Azzopardi as it was on a computer server held by the police

But it was clear that the company could not be saved. 

He said the central problem the company had was the trips to Corfu'.

Asked if the company could be saved, he said it could not.

He said that had the warning by the Consumer Affairs  Authority not been issued last November and published by the media, then the company could have recovered.

 

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