Creditors owed more than £20 million from the collapse of online travel agency AirFastTickets UK (AFT UK) have been left in limbo following the demise of its US parent company, TTG has learned.
AirFastTickets Inc (AFT Inc) entered bankruptcy in September, almost a year after its UK subsidiary closed.
Court papers filed in the US state of Delaware, which have been seen by TTG, include accusations of alleged fraud perpetuated by founder Nikolaos Koklonis.
The company’s UK division was one of a number operating across the world. When the UK branch fell into administration last October, airlines and other creditors put in claims totalling £23.8 million.
Joint administrators from FRP Advisory said AirFastTickets UK was owed £20 million from its US affiliate, which also owes some £12 million and £3 million to the Greek and German offices.
Geoff Carton-Kelly for FRP Advisory told TTG it was still “difficult to tell” how likely the creditors in the UK were to see any of the money owed, as it was still “very early in the process”.
According to an updated progress report recently released at Companies House in the UK, the joint administrators attempted to take action against AFT Inc but discovered that it had already been placed into receivership in July 2015.
“The joint administrators believe that given the level of its claim against AFT Inc the company is likely to receive a substantial portion of any sums available to unsecured creditors,” the report said.
“However, at this time the quantum and timing of any dividend from AFT Inc to the company remains uncertain.”
On October 9 this year, the UK company was moved from administration to liquidation. The move came after Iata suspended the OTA from trading from its UK, Greek and German offices in June 2014, due to debts totalling around €45 million.
At the time of the failure last year, questions were raised about whether authorities had kept track of the company.
“One must ask what investigating there was when the firm was growing at the speed it was,” said Alan Bowen, legal advisor of the Association of Atol Companies.
“Is it feasible for a company’s turnover to grow at such a phenomenal rate?”
A sale of the US company’s assets is currently being discussed in the US.
A hearing date of November 24 had been set to grant authorisation for the sale of the company to an entity known as AirTourist Inc.