Abta has confirmed Super Break failed with about 20,000 forward bookings, which were mainly domestic or non Atol-protected bookings.

However, while flight and accommodation bookings are protected under the Atol scheme and other transport and accommodation bookings by Abta, agents were shocked to discover on Thursday evening Super Break had “chosen” not to protect hotel-only bookings with Abta.

This was despite Super Break stating prominently on its hotel brochure, of which TTG has seen a copy, it was a “proud member of Abta and an Atol licence holder, meaning you can rest assured knowing you’re covered”.

MORE: How agents can help affected Super Break clients

Abta’s guidance, though, issued following the collapse of Super Break on Thursday, states: “If you made a booking with Super Break for accommodation only, the company chose not to protect those sales with Abta.”

Westoe Travel director Graeme Brett told TTG: “Super Break produced a hotel-only brochure that displayed the Abta logo and a recorded message when you rang their call centre referred to ’full protection’ on your booking.

“A lot of agents will get a shock today [Friday] when they learn that Super Break had ’chosen’ only to protect packages with Abta and not hotel-only bookings."

Brett said 10 of Westoe’s 133 Super Break bookings were affected, with the majority comprising rail travel and accommodation and therefore constituting a protected package.

“As Super Break took money from agents up to 12 weeks before travel, many agents [will] have paid for forward bookings they will not get the money back for,” he added.

Alan Bowen, legal advisor to the Association of Atol Companies, told TTG: "Some years ago, Abta agreed to change the rules so if the law did not require financial protection, in other words, if the product was not a package, then they would allow membership to continue with no financial protection in place.

“The problem for agents, of course, was that the business [offering the product] continued to be a member and most, now wrongly, assumed everything was protected.

“For customers who booked directly, they can make a claim against the card issuers and get their money back. But if they paid an agent, it will be the agent’s bank account that gets hit by the chargeback and this could be a real shock.”

An Abta spokesperson said: “Abta is providing financial protection arrangements for any non-flight packages booked through Super Break.

“Abta members must have financial protection arrangements in place for package holidays, there is no requirement to protect hotel-only or other types of bookings – it is an entirely commercial decision for a business to enter into additional protection arrangements.

“All hotel-only bookings, booked either directly with a hotel or through intermediaries, are generally unprotected, apart from where the customer paid by credit or debit card.”

Super Break parent Malvern Group confirmed on Thursday it had ceased trading after failing to find a buyer for the 49% of the business owned by Cox & Kings (India).

The business placed itself up for sale last week after the Indian tour operator defaulted on its Iata billing and settlement plan (BSP) in June.

Malvern appointed KPMG to oversee a sale, but the company confirmed on Thursday afternoon it had been unable to find a buyer or secure support from the banking sector.