Even Overseas Hotels Were Hit... The Evajong Incident Spreads Widely, Relief Efforts Remain Distant

Issue of Payment on Behalf Arises at Overseas Branch of Global Hotel Chain
Despite Years of Capital Erosion, CEO Interviewed on Business Expansion in April This Year
Damage Estimated at About 370 Million KRW... Fair Trade Commission Investigation and Police Probe Underway

[Asia Economy Reporters Jeon Jinyoung and Gong Byungseon] #A reserved overseas hotels worth 7 million KRW in March 2020 through the online hotel booking agency 'Evajong'. Unable to use the reservation due to COVID-19, A inquired about using the reservation after quarantine measures were lifted, but received no response. After persistent silence, the news that came was Evajong's 'hotel fee eat-and-run controversy.'

#B paid 6.3 million KRW early this year for a 6-month hotel pass product that allowed unlimited use of hotels partnered with Evajong. Dreaming of using luxury hotels during summer and winter vacations, the result was an eat-and-run. The incident occurred without any use, leaving no way to get a refund and a bleak situation.

Evajong's 'eat-and-run' incident is spreading beyond Korea to overseas. However, relief for victims is far off, increasing consumer dissatisfaction.

Overseas hotel promotions promoted on Evajong's homepage. Currently, photos and other materials have been removed from the homepage.

◆Evajong's notorious reputation well-known even in domestic hotels...damage expected to expand to overseas hotels

According to the hotel industry on the 17th, global hotel chains with hotels in Korea had already experienced several issues with Evajong's payment on behalf before this incident.

In one hotel chain, Evajong's payment-on-behalf damage occurred at an overseas resort branch, and several inquiries came to Korea this year saying, "Koreans staying through Evajong demanded payment on behalf, causing complaints." The chain terminated its contract with Evajong immediately after recognizing the situation. A representative said, "Since Evajong mainly contracted with overseas luxury hotels, the damage to overseas hotels is expected to be even greater."

A representative of a domestic luxury hotel that partnered with Evajong also said, "Issues such as payment on behalf by Evajong occurred continuously, so we deliberately made contracts only for customers to pay on-site," adding, "We terminated the contract due to trust decline after the incident." Currently, luxury hotels in Jeju involved in Evajong's accommodation promotions have requested to remove the promotions.

◆Capital erosion state for several years...yet CEO gave interview in April saying "Flexible response against COVID-19"

According to the Small and Medium Business Status Information System, Evajong's corporation Bonvoyage has been in a state of capital erosion for five years. It recorded continuous operating losses from 2015 to 2019. Since last year, Evajong failed to pay hotels, and Seoul Guarantee Insurance made five subrogation payments from June to August. In January this year, Evajong was listed on the court's debtor default list for failing to repay 67 million KRW principal and delayed interest to a hotel in Seogwipo, Jeju.

However, CEO Edmond de Fontenay gave an interview to a French media outlet in April, announcing plans to expand business by collaborating with the Hong Kong luxury platform Onthelist. CEO Edmond said, "We plan to operate the business flexibly against COVID-19 with Onthelist," and "We will collaborate for luxury fashion sale business, etc." This was a media packaging effort during a period of no payment ability.

◆Fair Trade Commission and police investigations launched...but victim relief remains distant

Currently, the police have identified 55 Evajong victims, with damages amounting to about 370 million KRW. The number of members in the victims' group exceeds about 300. CEO Edmond appeared twice for police investigations, and the Fair Trade Commission (FTC) conducted an on-site inspection.

However, relief for victims is bleak. Evajong has no funds to repay. If the police begin full-scale investigations, Evajong is expected to officially file for bankruptcy. This means the path to recover money will disappear.

Victims with small damages under 1 million KRW are considering whether to file lawsuits. Lawsuits may be prolonged, and legal costs could exceed the damage amount. Victim C said, "I suffered about 1 million KRW in damages, but even preparing for a lawsuit is overwhelming." If victims sue Evajong, future trials are expected to focus on disputes over the intent of fraud charges.

An FTC official said, "We will investigate whether this violates the Electronic Commerce Act," and "Above all, we will do our best to prevent additional consumer damages."

This content was produced with the assistance of AI translation services.