The risks of prepaying for future services aren’t limited to jet cards, where OneFlight International members could lose as much as $300 million in prepayments.
The recent collapse of a residential cruise operation in Cambodia shows that the risk of losing advance payments isn’t limited to the private skies.
Villa Vie Residences suspended operations this week, leaving approximately 200 residents scrambling to find alternative accommodations.
Residents spent hundreds of thousands of dollars to make a cruise ship their permanent home.
Some had no place to go, retirees who had sold their homes to move onto a cruise ship.
Life at sea
The Florida-based company offered customers the opportunity to live permanently on the Villa Vie Odyssey, a residential cruise ship that began sailing in September 2024 after months of delays.
Its programs included cabin purchase rights, monthly fees, and lifetime cruising packages.
Residents at least 15 years aboard, covering the ship’s expected lifespan.
Other reports said some residents were promised residences on a second ship when it launched.
Reuters reported that Americans Lynn and Paul Montoya sold their Wyoming home and cars to purchase a $179,000 cabin, with approximately $6,000 in monthly fees.
Other customers reportedly paid between $300,000 and $500,000 upfront for programs promising lifetime accommodations without monthly maintenance fees.
However, the economics proved unsustainable.
According to documents reported by the media, Villa Vie faced about $3.1 million in monthly operating expenses against a potential $2.5 million in monthly revenue, even assuming full occupancy and full fee payment.
At the time of suspending operations, management said it was taking in around $750,000 per month.
Villa Vie said it was exploring restructuring and recapitalization alternatives over the following 60 days.
The financial damage to customers remains uncertain; however, for some it could mean financial ruin.
Residents now face the possibility of losing substantial portions of their investments, although the ultimate losses will depend on any restructuring, refunds, and contractual ownership rights.
The company is reportedly planning to file for bankruptcy.
Life at Sea failure
Villa Vie wasn’t the first long-term cruising attempt to leave customers financially stranded.
In 2023, Life at Sea Cruises marketed a three-year, 1,095-day voyage around the world, visiting more than 140 countries.
The venture, associated with Turkish cruise operator Miray Cruises, advertised prices starting around $30,000 annually per passenger, including accommodations, meals, and other amenities.
Customers paid substantial deposits, sold homes, and made arrangements to spend three years at sea.
However, the company failed to secure a suitable ship and canceled the voyage in November 2023.
In January 2024, The Washington Post reported that 78 prospective passengers claimed approximately $16 million in losses in a letter to federal prosecutors.
One passenger reported paying nearly $157,000 across 27 credit-card transactions.
Life at Sea Cruises subsequently filed for Chapter 7 bankruptcy in Florida in July 2024.
Its filing listed fewer than $50,000 in assets and estimated liabilities below $50,000, figures that did not reconcile with the substantially larger customer claims reported earlier.
READ: Caveat Emptor: Avoiding private jet scams, bankruptcies, and shutdowns
Other prepayment losses
The problems extend beyond residential cruising.
In his recent Private Jet Card Comparisons examination of escrow accounts for jet cards, Giancarlo Diago Cevallos documented several failures involving customers who prepaid for goods and services.
Crystal Cruises’ 2022 bankruptcy left customers and travel agents facing approximately $100 million in unpaid amounts.
Florida construction company Van Der Valk Construction went bankrupt with more than $1 million in liabilities and less than $100,000 in assets, leaving customers with unfinished homes.
Supreme Pools’ 2024 closure reportedly left at least 45 swimming pools unfinished.
Yachtbuilder Kadey-Krogen also filed for bankruptcy in 2026, raising concerns about deposits and progress payments on unfinished vessels.
The common thread is that customers pay substantial amounts before receiving the promised services or products.
As Cevallos explained, companies sometimes describe customer deposits as segregated or escrowed, although those arrangements don’t necessarily protect customers if a business fails.
True third-party escrow arrangements can offer additional protection, depending on their terms, but many prepaid programs rely on the provider’s financial stability.
For private jet flyers considering six-figure jet card deposits, the cruise industry provides another reminder that a company’s promises, attractive pricing, and even existing operations don’t necessarily guarantee the security of money paid for future services.
OneFlight International
So far, OneFlight’s demise has resulted in a dozen lawsuits, including one naming spokesperson Robert Herjavec of Shark Tank fame.
Herjavec tells Private Jet Card Comparisons he is planning his own lawsuit against the grounded jet card broker.
READ: Jet card buying tips (again)
