British holidaymakers and crew in Cuba were banned from leaving the country by officials until they paid extra following the collapse of Thomas Cook.
The British ambassador was forced to intervene after stranded passengers and members of the company's staff said they were being 'held hostage' in a number of resorts after the travel firm went bust.
Following the demise of Thomas Cook last week, the UK government agreed to fly home the estimated 150,000 customers stranded worldwide in the biggest ever peacetime repatriation.
However, some holidaymakers and crew claimed the UK Civil Aviation Authority's ATOL protection scheme is not recognised by the Cuban government.
According to one woman, her mother was locked in her room and threatened by a security guard.
She tweeted: "My mum is staying in Cuba, they are holding her hostage not letting her leave until she pays for her whole stay which she has already payed for.
"This is f***ing disgraceful, she was locked out of her room and threatened by guards."
A holidaymaker who is due to leave Cuba next week witnessed hotel staff refusing to let around 15 fellow travellers leave to catch their flights on Tuesday.
She told the Mirror Online: "They were demanding £500 from each person for each week. So a lot of people were being billed for £1,000.
"We paid £3,000 for our holiday so just don't have that extra cash."
A woman who said she was a Thomas Cook employee told her friends they were forced to sleep on the floor.
She said: "Things are getting serious here. The Cuban government don't have a system in place for this. They don't recognise the CAA.
"They won't let anyone leave the country until someone proves that they can get their money."
Under normal circumstances, the government would only agree to rescue passengers with ATOL cover.
But they have agreed to fly all stranded customers home making this the largest repatriation of UK citizens since the Second World War.
British ambassador Dr Antony Stokes has issued an apology and added that Thomas Cook hotels in Cuba had been instructed on Wednesday to let customers and air crew leave without paying.
Responding to the claims, a UK government spokesman said: "We understand that this is a hugely distressing situation for Thomas Cook passengers, people with holidays booked with Thomas Cook and Thomas Cook staff.
"The Government and CAA are working around the clock to support all those affected, undertaking an emergency operation to repatriate more than 150,000 passengers stranded abroad.
"The Government have deployed teams on the ground to support those affected, and are in contact with local authorities and hotels."
