MSE News: Avoid holiday hell: know your travel refund rights

My Partner and I have recently come across this nightmare scenario.
Booked a holiday through beachsunholidays, part of the Sun4U group who ceased trading on 12th August 2010.
The first mail concerning the booking was a confirmation that all our holiday booking had been processed, at the foot of this initial mail was the assurance that we were ATOL protected through the Civil Aviation Authority.
This also states that it was an air holiday "PACKAGE" and the details of flight, accomodation and transfers and the money was duly taken from my partners account in full.
We then start to get mails saying that we are flying with monarch airlines at the times stated on the first confirmation e-mail and the costs of accomodation and transfers.
The CAA website said for people due to travel like us, that we should not travel but claim the cost back through the ATOL protection scheme. We did this and now ATOL say we were not protected because the people we booked with had booked the holiday in seperate pieces, flights had been paid by us, un be knowing to us that Sun4 U had passed on the card details to Monarch, who are a non refundable airline by the way, so, whichever way you look at it we had been shafted as they had got the money for the flights before we are informed of their T&C`s, which states non refundable.
That also takes us out of ATOL protection.
But someone must be liable for re-imbursement of our costs, my partner attended her bank today and they insist that she cannot claim back any costs through their charge back scheme.
It all leaves us out of pocket by a lot of money with no one answerable as to where the responsibility lies to pay back the money which companies unbeknown to us had removed from her account in what i can only term as illegally passing on card details to a third party without asking permission or stating that is the course of action they were taking to secure our booking.
Can anyone advise why companies can still do this in this day and age, with all the financial protection the modern world offers,or offers then removes through clauses the consumer is not aware or made aware of.
surely this is mis-sellling or misrepresentation in the very least.

The protection of the Package Travel Regulations and the ATOL scheme will clearly not apply. You ought to be protected by section 75 of the Consumer Credit Act providing it is a true credit card but I would be rather worried that an American travel agency is itself operating outside the US! That would be my worry, why, is it because they cannot get a license to trade in the States themselves, you might be financially protected but I would have doubts about the holiday itself. I would call your bank to be satisfied, and before I finish, this isn't a voucher type holiday is it? If it is, run a mile!