I'm pretty sure that the reservation was lost and not completely their fault as it was done via another party so..


They went ahead and gave another reserved room to you that probably hasn't been paid yet and, is more than the flat 500 you prepaid for.

That I assumed since they crossed out her name and placed yours.

When the bill came, since hotel has a lot of folks working in it, it was probably not explained to the person checking you out that while the reservation was under ms x name, that it really is for yours, which couldn't be found at that time and is prepaid.

Did they not refund you in a timely manner?

I don't see why there's a compliant or something illegal for what to me, as an outsider sees, misunderstanding