Passenger Disappearance Leads to Scrutiny in Cruise Industry

At every turn in the past two months, Royal Caribbean International has found itself fighting round after round of accusations and aggressive press coverage about disappearing passengers and shipboard crime. And if lawyers and lawmakers have their way, public attention to those issues is likely to increase in the coming months.

Appearing on national television, Richard Fain, Royal Caribbean´s CEO, has disputed accusations that the company was insensitive and negligent in its actions following the suspicious disappearance last summer of Connecticut honeymooner George Smith.

Fain´s appearance was preceded and followed in other venues by the company´s lawyers, public affairs executives, the head of fleet operations and the captain of the ship from which Smith disappeared.

Much of the recent media coverage was fueled by a congressional hearing in December into questions about shipboard safety and industry practices stemming from the Smith disappearance. The issue is expected to be revived in early March, when more family members of missing cruise passengers are expected to testify in a second series of congressional inquiries that will embrace wider issues of maritime law, jurisdictional conflicts and regulation of cruise lines.

Cruise industry officials say they are confident about their safety practices, reporting procedures and treatment of customers. But sources within the industry also say that when the smoke clears, the U.S. mass market cruise industry, which has seen substantial growth over the past decade, could end up facing tighter regulatory scrutiny and increased consumer liability.

Still, the growing tide of negative publicity is creating potential political problems for the industry as it is forced to answer questions about how cruise ships that dock in U.S. ports are regulated, and by whom.