Student finds that 'honor' is pricey

Mecca Dowd and her dad have worked hard to raise nearly $7,000 since late last year.

That's when the Smithfield Middle School student, 12, got a letter saying she had been selected to travel to London next month as an ambassador for the nonprofit program People to People International, a foundation with the goal of increasing "international understanding and friendship." Then she learned she had to come up with the money.

The letter didn't say -- and most of the tens of thousands of students traveling annually as People to People International representatives aren't told -- that such trips boost the bottom line of a for-profit business called Ambassadors Group in Spokane, Wash.

According to its annual report, Ambassadors Group pays a royalty of more than $2 million a year to the nonprofit People to People International to arrange travel for those who sign up. The letters to students such as Mecca don't mention that relationship, and instead solicit participants -- selected through a recommendation or a vaguely defined academic list -- with the "honor" of an invitation to represent an organization founded by President Eisenhower.

Eisenhower established People-to-People in 1956 as a Cold War initiative of the United States Information Agency to boost understanding among people of different nations. A foundation born of the effort failed to get the support of such heavy hitters as the Ford Foundation and was dissolved in 1958, according to papers in Eisenhower' presidential library.

The current organization, People to People International, was founded in 1961 with Eisenhower as board chairman, and now is headed by Eisenhower's granddaughter, Mary Eisenhower. In addition to coordinating student travel, People to People offers adults international trips and oversees a network of chapters in the United States and abroad that promote peace and humanitarian ideals.

The relationship between People to People International and the for-profit travel agency evolved through the years, coming to its current form with a 2002 deal that created Ambassadors Group Inc. as marketers of "private-label travel programs," including the Student Ambassador Programs.

Leaving a bitter wake

Traded on the Nasdaq stock market as EPAX, the $100 million Ambassadors Group, along with People to People, has been the subject of complaints to state attorneys general and other authorities in North Carolina, Minnesota, Florida, Virginia, Iowa and Washington.

According to documents filed with these states, the company has:

* Failed to meet health and safety needs of some student travelers. A Minnesota couple's wrongful death lawsuit, set for a jury trial next year, claims that People to People failed to provide adequate medical care in the death of their 16-year-old son, a diabetic, during a trip to Japan.

Ambassadors Group CEO Jeff Thomas, whose annual compensation is listed as $2.7 million, said his company grieves the death of student Tyler Hills, but will dispute in court his parents' version of its cause.

* Sent congratulatory invitations to students on a variety of mailing lists, some so out of date that two families received invitations for children who died in infancy.

* Failed to deliver on what the program promises are specialized, upscale trips.

* Tacked on additional fees and charges to an agreed-upon price for trips.

People to People officials said isolated incidents of improper marketing or lapses in care may have occurred, but that the program typically provides once-a-lifetime opportunities.

"With the complaints and that kind of thing, there are two sides to the story," Mary Eisenhower said. "The satisfaction rating on our surveys is in the 96th to 98th percentile."