An investigation has been launched by the Office of Fair Trading after accusations were made that hotel groups Thistle, Radisson and Starwood have been engaged in price fixing with online travel agents to keep room-rates artificially high. According to reports, the chains have been contacting travel firms and telling them not to offer customers discounted prices.

The accusations are that the hotel groups are engaging in rate parity, which means rooms are being offered to guests at the same price whether booked with the hotels directly or via a travel provider. The agents and hotels run the system and anyone found to be flouting it may be taken to task.

In the end it is the consumer who pays the price and has no choice but to agree to the inflated figures. If the OFT finds proof that the hotels have been engaged in any sort of price fixing or cartel activity then the groups face hefty financial penalties.

The practice has come to light after Dorian Harris, owner of Skoosh, an accommodation website, claimed he had been receiving instructions from hotels to stop offering any discounts. An OFT spokesman confirmed that the matter was being looked into, but that investigations were still at an early stage.

He added that there was however enough evidence that meant the matter would be made an administrative priority and that the investigation was ongoing. Both the Thistle and Starwood hotel chains have said that they are not involved in any activities which could be considered wrong.