Crystal Cruises’ customers owed $100M after luxury operator’s sudden collapse

Crystal Cruises customers hoping to get their money back after the insolvent luxury operator’s sudden collapse may be out of luck.

The cruise line, which drew scrutiny earlier this month after two of its luxury vessels were seized by authorities in the Bahamas, owes more than $100 million in customer deposits and down payments, according to former Crystal Cruises president Jack Anderson.

Customers who paid for an upcoming cruise by credit card have the best chance of recovering their money, Anderson told Bloomberg on Wednesday. Refunds for those who paid for their trips in cash will be more difficult to obtain.

Meanwhile, Crystal Cruises customers who received a credit for a future voyage due to the cancellation of a trip during the COVID-19 pandemic — when many cruise lines were shut down — won’t receive any compensation at all. Travel agents who facilitated the sales will also have a hard, if not impossible, time recovering their commissions.

In a separate interview with Seatrade Cruise News, Anderson estimated that up to 80% of customers affected by the collapse had paid by credit card.

Crystal Cruises shuttered its US operations, closed its offices and laid off remaining employees effective Feb. 11.

The shutdown occurred just days after US Marshals seized two of Crystal Cruises’ luxury ships — Crystal Serenity and Crystal Symphony — in the Bahamas over $4.6 million in unpaid fuel bills. Hundreds of passengers were reportedly stranded during the incident.

A perennially top-rated cruise line, Crystal Cruises encountered financial difficulties in recent years.

Its parent company, Genting Hong Kong, indicated in a January filing that it would work with provisional liquidators to pursue a restructuring of the company. The company reported major losses during the COVID-19 pandemic.

Anderson told Bloomberg that Genting Hong Kong had “effectively washed their hands of Crystal” during its own financial struggles. The former president said Crystal Cruises had no cash remaining on hand by the time it shut down for good.

“Ultimately, we ended up with a bank account of zero,” he told the outlet.

Crystal Cruises’ website was still operational at the time of publication. The site displays the same message it has shown for days, noting that it “continues to process refunds as quickly as possible, however, there are delays from the credit card processors as they are receiving a very high volume of refund requests.”

V.Ships, a ship management firm, has taken control of three of Crystal Cruises’ vessels, including the two ships that were seized in the Bahamas.