Travel firm boss Chris Reynard is facing a £500,000 fraud inquiry after hundreds of schoolchildren had their ski holidays to Switzerland and Austria cancelled.

Police are investigating claims that Mr Reynard's firm, Skiing Europe, let down more than 20 schools over the spring half term and Easter holidays by failing to book accommodation, transport and ski hire.

Schools discovered the money they paid in advance had not been passed on to coach firms, hotels or lift-pass operators, with many parents and teachers losing their payments along with their holidays, while other went ahead with the trip but paid twice. In some cases, schools refunded parents' cash or the local education authority stepped in.

Most schools pulled out of the trips when they realised what had happened, but they were still billed for the holidays. Some teachers who did travel had to pay for accommodation and ski hire using their own credit cards.

Although Skiing Europe was a member of the Association of Independent Tour Operators, its insurance bond only comes into play if the company becomes insolvent, which it has not.

In 2000, Mr Reynard was disqualified from being a director for five-and-a-half years after his previous company, Howglen Holidays, an activity holidays provider, went bust in 1996.

He was also a shareholder in a firm fined £60,000 for corporate manslaughter over the Lyme Bay canoe tragedy in which four teenagers died in 1993.

Devon and Cornwall Police confirmed that officers are investigating allegations of fraud against the company.

Mr Reynard issued a statement saying: 'We have not been contacted and have done nothing to warrant this. There is a consequence to so many schools being in arrears with their payments. We are initiating action against those responsible.'

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