THE Government has pledged to clamp down on rogue holiday companies after a North-East MP claimed a holiday scam had conned people out of thousands of pounds.

North Durham MP Kevan Jones addressed the House of Commons on Tuesday to highlight the growing number of holiday clubs pressurising people into handing over large sums of money for holidays that never materialise.

He told of how several people from the region had handed over money to a former Washington-based firm On-Line Vacations.

The people paid between £1,950 and £4,800 for membership to the holiday club and were told they would receive a PIN number to the agency's web site to access discounted holidays. But to date none of them have received a holiday or their money back.

One 65-year-old Washington man, who wishes to remain nameless, said he handed over £3,500 of his retirement money to On-Line Vacations after they rang him up inviting him to a presentation in Washington on January 26, where he was sold membership.

He said: "I'm considering it a dead loss. I've lost £3,500. If I get it back it will be a miracle."

Another couple from Chester-le-Street took out a £4,000 loan two years ago to pay for membership to the holiday club, which was then trading as GM Leisure.

Trade Minister Alan Johnson said existing European laws regulating timeshare holidays should in future cover holiday clubs.

He added: "The Department of Trade and Industry will work with the Office of Fair Trading to ensure better enforcement of existing legislation."

After the debate, Mr Jones said: "I will be working with Stephen Hughes, the MEP for Durham, to ensure that this case is highlighted when the new directives are drawn up."

He said he would also be passing on a file to the minister about On-Line Vacations.