Hotels are “suspicious and angry” over the millions of pounds owed to them by failed travel firm Thomas Cook.
One hotel in Mexico is owed £2.5m, one of the largest proportions of the firm’s £338m debts to hotels alone.
After the collapse of Thomas Cook, some holidaymakers reported being held hostage by the hotels they were staying in, with reports of tourists being trapped until they paid what the company had owed the hotel.
The situations came despite holidaymakers having paid in full, and even though thousands of the hotels were covered in the ATOL protection scheme.
Dame Deirdre Hutton, chairwoman of the Civil Aviation Authority (CAA), said hotels were owed £338m so it was not surprising that they were worried.
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She told BBC Radio 4: “We have learned of one hotel in Mexico that is owed £2.5 million, so it is hardly surprising they are worried. That hotel is working very closely with us, which is great.
“It’s very distressing for people who are finding difficulties with their accommodation.
“We have got more than 200 staff working here together with Thomas Cook staff and we have already started making the first payments. But, as you say, given how much those hotels are owed by Thomas Cook, it is hardly surprising that they are suspicious and angry.”
Grant Shapps, transport secretary, suggested there is a need for new laws to “ensure passengers do not find themselves in this ridiculous situation ever again”.
He added: “[Travel companies] need to be able to look after their customers and we need to be able to ensure their planes can keep flying in order that we don’t have to set up a shadow airline.
“This is where we will focus our efforts in the next couple of weeks.
“We will require primary legislation, and, dare I say it, a new session of parliament.”
One holidaymaker, Natalie, wrote on Twitter: “Yesterday we got held hostage/stranded in Mexico. Locked out our rooms, water took away in 40 degree heat. Hotel demanding extortionate fees.
“OH and they turned WiFi off so we can’t contact anyone! WHAT A DAY!!!”
There were also problems in Cuba, where the UK ambassador had to step in to instruct hotels to allow customers to leave without any additional fees.
Anthony Stokes tweeted: “Urgent for #ThomasCook customers: hotels in #Cuba now have authority/instruction to allow customers, and air crew, to depart without paying (on basis of ATOL guarantee).
“Very grateful for patience of all affected in distressing circumstances.”
Union leaders have stepped up calls for the government to intervene after it emerged the German wing of Thomas Cook is being given finance to help secure a rescue deal.
Condor is getting six months of financing from the German government, worth a reported £350m.
But in Poland, Thomas Cook’s Neckermann Polska said it was filing for bankruptcy.
Thousands of UK workers lost their jobs when Thomas Cook went bust on Monday, and the CAA began the biggest peacetime repatriation of people, bringing tourists home to Britain.
Thomas Cook were having to sell 3 million holidays a year to pay the interest on the loans taken out, which eventually saw them fold.
Brian Strutton, general secretary of the British Airline Pilots Association (Balpa), said: “Good luck to the Condor staff and customers, but with UK holidaymakers stranded and 9,000 staff out of a job, the Thomas Cook directors need to explain why the UK airline had to be closed but the German one was allowed to continue to operate.
“And why couldn’t the UK government give the same kind of bridging support as the German government when it was well known that Thomas Cook had a Chinese buyer lined up? It’s a national scandal.”
But Dame Deirdre said one problem was how long Thomas Cook had been struggling for.
The CAA had completed more than 130 flights on Monday and Tuesday, bringing 30,000 people home, with 95% returning on the same day as their original Thomas Cook flight.
It said it is working around the clock to bring home an estimated 120,000 people.
On Wednesday, some 70 flights were expected to return 16,500 people.
A Department for Transport spokesman said: “The German airline Condor is a different airline, operating in a different market, and with potentially different commercial prospects.
“It is therefore a decision for the German authorities whether they agree to support German businesses with short-term taxpayer loans.
“The government was not presented with a viable proposition by Thomas Cook’s board to support the company. We stand fully by our decision.”
