4-2-08 Windjammer Cruises Officially Out of Business
Many CruiseMates readers read my series of five articles on Windjammer Barefoot Cruises Limited. The Burke family patriarch, Michael Burke Sr. built a cruise business from nothing, only to have his children to tear it asunder with infighting and neglect. For those of you who did not read the story, it is better than most novels, and it's all true.
Today, April 1st, 2008, is the day that the most recent CEO of the company, Joey Burke, had promised Windjammer's faithful followers that the fleet would once again be in full service. This was back in December of 2007 when the company was scheduling cruises on its last remaining ship, the Legacy, only to end up canceling them one day before sailing due to "financial difficulties" and other various excuses.
And today, I have finally have in my hands what many people have been seeking for months. Thanks to "Jerry," a regular poster at the Windjammer message board known as the "Flotilla," (www.jammerbabe.com/flotilla/), I have a copy of a letter from the Florida Department of Agriculture and Consumer Services stating that Windjammer Barefoot Cruises LTD is "no longer in business."
As the entity legally responsible for oversight of registered Florida Sellers of Travel, issued a response to Jerry's complaint against the company that says...
"According to our records, this seller of travel is no longer in business and efforts to contact them on behalf of consumers have proven unsuccessful. This company was not required to post financial security with this Department. The State, therefore, holds no security from which to draw or make refunds to those individuals who had purchased travel related services from this business"
"You may wish to seek private legal counsel or you may file a claim in small claims court. There is, however, no guarantee you will be able to recover the money you paid to this company."
"We regret that we were unable to be of assistance at this time. Please let us know if this office may be of service in the future with another consumer related matter."
" Don Dietrich Regulatory Specialist III 850-410-3801 Email: email@example.com"
The good news about this letter is that it should be proof enough for the hundreds of people, many of whom paid well over $10,000 per family, to go to their credit card companies and request a refund. For others, who bought into the odd sailing time-share scheme the company put forth, it may be enough to legally claim a capital gains write-off on their taxes (ask your CPA if this is possible).
How big is the Windjammer debacle? For a small cruise line it is surprisingly far-reaching. The company bought a research vessel in August 2003 and announced they were converting it into a cruise ship and sailing time-share. They produced a beautiful color brochure to represent the final product, the LaMer, and proceeded with a heavy pitch by timeshare salespeople earning as much as 50% commission using the list of past passengers for their contact sheet.
The sales effort was so intense that likely prospects tell stories of being taken out to dinner and lubricated with spirits until they agreed to sign, in many cases after they had said they were not interested at all repeatedly. Timeshares were offered for every week of the year and for every cabin on the ship as shown in the brochure. Unfortunately, the brochure was the only thing ever turned into a timeshare. The actual vessel remained unchanged and to this day is rotting away in a Trinidad shipyard. The contract did specify that the company could replace cabins on the LaMer with cruises on their existing vessels, which they did in many cases.
Sometime in 2005 one of the family members raided company funds for as much as $450,000. Lawsuits from his siblings followed. Still, sales of these time-share contracts continued through late 2006. By then the line's other vessels were already falling apart due to neglect and lack of working capital. By 2007 crewmembers and bills for provisions were not getting paid. In November, 2007, the last remaining working Windjammer vessel sailed its last cruise.
After the last cruise, people looking to collect on their pre-paid cruises were told the company was in the process of rebuilding, and that April 2008 was the target date to have the company fully operating again. Customers requesting their cruises were told that getting the fleet up and running again was just a matter of time and urged to "wait until April". Those who insisted on refunds were asked to fax or mail in requests, but in almost every case these requests were ignored.
Throughout early 2008 the Burke family went quietly underground. They stopped commenting in public and put out no press releases. In March, the Miami headquarters went silently dark. The company still owed millions of dollars in unfulfilled cruises alone, plus other financial liabilities. Yet, they never declared bankruptcy or any other formal financial moves at all.
This lack of formal legal status - being a cruise line with no working ships -- left anyone who is owed money by the company at a loss. Many credit card companies would not issue refunds. The exception would be if the customer could prove the company was out of business, but strangely, the Windjammer Web site remained online, looking as if the line was still robust. There was no proof of the debacle that was really happening.
The truth is, greedy family members had picked the company carcass dry, according to one eyewitness I interviewed. Whenever the time came for financial responsibility they resorted to a tactic of blame shifting. In fact, the Web of legal entities who still own various pieces of the company is so convoluted that it is said even the Burkes have lost track of what is what.
In any case, the last company CEO, Joey Burke, had promised April would be the dawning of the new Windjammer, and now that April is here the Burkes are as invisible as ever. The latest rumors say that the ships have been seized by creditors and will be auctioned off. Another rumor says that one of the Burke sisters, Polly, is blaming the British overseer of the company Trust, Pallister, for their inactivity. Apparently, he is content to let the family's future wave in the wind as long as he can continue to collect legal fees. Possibly, when he is done collecting maintenance fees for the trust he will be representing them in criminal court as they face charges of bilking investors out of millions of dollars.
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