Singapore's consumer watchdog has received 35 complaints against Asia-Euro Holidays since news broke that the travel agency closed suddenly on Friday.
Claims add up to more than $92,000, and mainly involve the agency's failure to honour pre-paid travel packages, said Consumers Association of Singapore (Case) executive director Seah Seng Choon.
A police report has also been lodged by a member of the public against the agency.
Its licence was revoked by the Singapore Tourism Board (STB) on Saturday, one day after the agency put up a notice at its main branch in Chinatown Point and on its Facebook page saying it was closed for business with immediate effect.
Chinese evening daily Lianhe Wanbao reported that the agency had made huge losses, amounting to about $2 million, in property investments. At least 500 customers are said to be affected.
The news also caused confusion among customers of another travel agency with a similar name.
Euro-Asia Holidays yesterday said it is a separate business entity from Asia-Euro Holidays, and that it had a "limited business relationship" with the firm.
Business registration records show that one of the two directors of the defunct firm, Mr Tay Jwee Hiang, was also a director of Euro-Asia Holidays until last month. He is the brother of Euro-Asia Holidays director Maggie Tay.
In a statement yesterday, Euro-Asia Holidays said neither Mr Tay nor co-director Tan Meow Hwee has any connection with it now.
"We are still in business and remain on good credit terms with our customers, as well as our local and overseas suppliers. We are not involved with Asia-Euro Holidays' investments," the statement said.
Wanbao quoted Ms Tay as saying her brother had expressed guilt to his relatives and friends. She said he was not trying to run away from his problems but needed time to solve them.
A staff member at Euro-Asia Holidays said Ms Tay and Mr Tay used to work in the same company but Mr Tay ventured out to set up his own firm more than 10 years ago.
Industry players said there were tell-tale signs from at least a year ago that Asia-Euro Holidays was facing cash-flow problems, when it was unable to pay employees' salaries on time.
Chinese daily Lianhe Zaobao reported that a number of Asia-Euro Holidays employees who are owed wages will be lodging complaints with the Ministry of Manpower.
Last year, Case discussed with STB a scheme that would make it mandatory for travel agencies to take out insurance in the event of sudden closure but STB preferred that it be a choice taken by agencies themselves, said Mr Seah.
"In view of the Asia-Euro Holidays case, we have written to STB once again to request that they reconsider their position," he added.
This article was first published on May 26, 2015.
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