Prestige Cruise Holdings Fined for Failing to Disclose Fees

The U.S. Department of Transportation fined Prestige Cruise Holdings -- which operates Oceania Cruises and Regent Seven Seas Cruises -- $75,000 for failing to disclose fees and taxes on free-air offers in advertisements.

However, a settlement lets Prestige pay $37,500 now and forego the rest of the fine if it complies with the DOT order for the next year. According to the DOT consent order, Prestige companies “failed to include air-related fuel and service surcharges” along with government taxes and fees in advertising -- a practice the DOT calls “unfair and deceptive.”

Prestige declined to comment on the action, but, in its response to the DOT, Prestige noted that it has never previously been the subject of a DOT investigation or enforcement action. Still, the company took action, most notably offering a simplified pricing structure in which all airline-imposed fuel surcharges and government taxes are included in the advertised fare.

The company said it also briefed senior marketing executives on the advertising rules, revised the Oceania and Regent websites, and discontinued printing of 2009 and 2010 advertisements. Prestige also said it sent emails to 31,000 travel agents to inform them of modifications to its advertising policies.

Prestige also notes that the “overwhelming majority” of its customers book with travel agents, who inform clients of all fees, taxes and surcharges. “As a result, according to Prestige Cruises, at no time were consumers misled as to the final price to be paid for air-inclusive packages,” the DOT order said. “Prestige Cruises maintains that no consumers were harmed as a result of its advertising practices.”