Questions Of Cash: Airline cancelled flights – and then disappeared

Q. In October 2007, I paid £197.55 for three flights from Dundee to Birmingham with Whoosh airline. To avoid credit card charges, I used my Maestro debit card. The flights were operated for Whoosh by White Eagle Aviation of Poland. On 9 December 2007, the airline suspended all flights on the route. Customers were advised to submit claims for compensation to White Eagle's managing agent in the UK, BluArrow, who would forward them to White Eagle's lawyers. I did this, but heard no more. I emailed WEA, but they did not respond. The company website had some information on compensation, so I assumed the claims were being processed. What is the situation? MP, Dundee.

A. Whoosh was the trading name of BluArrow Aviation Ltd. Companies House records show the company is now dissolved. The company traded from an address in Halesowen. We contacted trading standards officers at Dudley Metropolitan Borough Council, who visited the premises. These are no longer used and are so small that it is reasonable to assume the company had little in the way of assets. Whoosh appears to have acted as a ticketing agent, without owning any aircraft itself. We understand that credit card companies began legal proceedings to recover payments, but abandoned these. The Civil Aviation Authority (CAA) also undertook investigations.

A spokesman for the CAA says: "White Eagle withdrew their UK services some 18 months ago, but continued operating in Poland. We asked the Polish Civil Aviation Authority to pursue the company for compensation for UK passengers affected, which they did, unfortunately without success. We understand that the company has now folded completely and has no assets or cash reserves to pay debts or compensation. Regrettably, there is nothing else we, or the Polish CAA, can do." The White Eagle Aviation website to which you refer no longer functions. Had you paid by credit card, or using a Visa debit card, the card issuer would have refunded your payment, but there is no such arrangement for payments made by Maestro debit card.

Q. I have a credit card that is now issued by MBNA, but was originally an RSPCA card issued by the Royal Bank of Scotland. I tried to close the account in July last year, but I have been unsuccessful because of a monthly payment that is still being drawn by AOL. I do not have an account with AOL. The account was opened by my ex-boyfriend, who I broke up with about 12 years ago. On several occasions I asked him to close the AOL account, but clearly he didn't. I no longer know how to contact him, so cannot close his AOL account.

When I spoke to AOL, the operative assured me the account would be closed when the payments ceased – but instead the payments have carried on and the account remains open. When I spoke to MBNA I was told that because of the way the payment was set up, unless AOL cancel the payment, the account will remain open. SK, Cambridge.

A. Your apparently simple request has proven very difficult to tackle. It seems, in fact, that the AOL account was not opened by your ex-boyfriend, but was done fraudulently by someone using your credit card for payment. This only came to light – after 12 years of payments of £2 a month – when we assisted you in trying to close your MBNA card account. A representative of AOL told us: "I would like to confirm this AOL account is not registered in [the] name [of the reader, or her ex-boyfriend]. It seems that [her] MBNA card has been used fraudulently to set up this AOL Broadband account."

AOL agreed to immediately close your account and cease making charges to your MBNA account. It asked that the matter then be taken further with MBNA. We did this and MBNA also investigated the matter, with the result that it blocked the transfers, closed your account and repaid charges dating back to when you first raised the problem with MBNA.

We then contacted the Royal Bank of Scotland on your behalf attempting to recover older payments made to AOL. However, RBS reported that it had never issued RSPCA affinity cards and had no records that you had been a customer.

We then established that the card had been issued by the Bank of Scotland, not RBS. Bank of Scotland is now part of the Lloyds group. It declined to make a refund of old payments, pointing out that you had never made any complaint of the transactions being fraudulent prior to the card account being transferred to MBNA in January 2006.

Q. In January, my son was asked by the Metropolitan Police to pull over for a vehicle check. The Special Constable then seized his vehicle, alleging that my son did not have valid insurance. This was despite the fact that my son did have valid insurance and could prove this. He had to find his own way home and pay £190 to have his car released. It turns out that two policies were registered on the database for the one car, for two owners and with two insurers. DB, London.

A. The Royal Bank of Scotland has accepted that it made a mistake and failed to remove its old policy from the Motor Insurers' Bureau database after the previous owner of your son's car sold the vehicle. On this basis, RBS has agreed to refund your son with the £190 paid to recover the vehicle. However, RBS refuses to refund incidental costs of £1,500 that you have claimed, including £500 of the time of family members in seeking to resolve the matter and £300 for lost overtime. RBS stresses that the Metropolitan Police's Special Constable had no legal grounds for seizing your son's car and should have given him seven days to produce the paperwork at a police station.

Questions of Cash cannot give individual advice. But if you have a financial dilemma, we'll do our best to help. Please email us at: questionsofcash@ independent.co.uk.