What happens if a seller of travel uses my payment for another purpose?

What the Law Says

California law strictly regulates how sellers of travel handle customer payments to protect consumers from fraud and insolvency.

Under the California Seller of Travel Law, any person or business selling travel services (e.g., flights, tours, cruises) to Californians must be registered with the Attorney General — unless exempt — and must comply with strict financial accountability rules.

A seller of travel must deposit all client payments into a 'trust account' within 24 hours of receipt. These funds must remain segregated and cannot be used for operating expenses, debts, or any other purpose until the travel services are fully provided or the transaction is lawfully canceled.

Using client funds for any purpose other than fulfilling the travel obligation is illegal and constitutes a violation of the law — even if unintentional.

Statutory Text

All moneys received by a seller of travel from a purchaser for travel services shall be deposited in a trust account within 24 hours of receipt.

— Cal. Code Regs. tit. 16, § 2804 — Trust Account Requirements

Statutory Text

It is unlawful for any seller of travel to use moneys received from a purchaser for travel services for any purpose other than the provision of those travel services.

— Cal. Civ. Code § 17550.19 — Misuse of Funds

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