Flight Centre Share Price Plunges amidst Concerns of Unethical Practices

Shares of Flight Centre Travel Group Ltd [ASX:FLT] have taken a huge hit, following allegations of ripping off customers, underpaying staff and a toxic work environment.

The travel agent has lost 15.47% of its share value since the beginning of the week — currently trading at $58.63.

Why has Flight Centre’s share price plummeted?

The fallen share price comes after ABC publicised an investigation earlier this week, into claims made by current and former employees of Flight Centre.

As reported by ABC, the claims highlighted staff member’s low pay and the push to secretly mark-up bookings, particularly targeting older and wealthier customers, to increase their own and the company’s commission.

Flight Centre commented on the issue, stating:

We are a retailer and we do earn a margin on the products we sell. Our overall margins are available publicly, but are not generally disclosed on a transaction-by-transaction basis’.

With unethical practices like this, it’s no surprise that investors are losing confidence in the retailer.

What is Flight Centre saying?

In a statement to the Australian Financial Review (AFR), Flight Centre Managing Director, Graham Turner stated that while service fees could be added to bookings to reflect extra work done by consultants, the company has procedures in place to monitor excessive charging.

He went on to say sources the ABC used for its investigation were ex-employees who ‘haven’t worked for us in years’ or had ‘failed in their jobs’, therefore not giving an accurate representation.

Let’s just say, Flight Centre has some serious damage control to run in order to salvage the company’s reputation and regain investors’ confidence.

Regards,

Ryan Clarkson-Ledward
For Markets & Money

PS: Our analyst Vern Gowdie believes that we’re about to see a catastrophic market crash. Vern says ‘Australian stocks could fall as much as 90%’. If you’re interested in finding out more about which Aussie household stocks could be the most vulnerable, check out his free report ‘Sell These Five ‘Fatal’ Stocks Now’.


Ryan Clarkson-Ledward is a junior analyst for Markets & Money. Ryan has degrees in both communication and international business. His priority is bringing you the latest price updates on stocks through ASX updates, as well as supporting Sam Volkering with background research. As part of the team at Markets & Money his aim is to provide unbiased and relevant news for readers. Ryan’s work with Sam is designed to provide research that complements Sam’s analysis for small-cap and technology stocks. Together, their objective is to break through all the jargon and give you the hard facts to inform your investment decision-making. Ryan writes for:


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