Travel agents do not have to thoroughly investigate suppliers. In general, they are required only to stay current with reasonably available information, such as what is in trade journals and magazines. The most important types of information are often the supplier's reputation, track record, and financial condition. A travel agent must provide this type of information, as well as any specific experience that the travel agent has had with that supplier, if it would likely affect your decision to use the supplier.
If a travel agent books you on a flight that has already been canceled or in a hotel that has not been built, you have a fairly strong argument that the agent was negligent and failed to undertake a basic investigation. If, however, a tour operator suddenly goes out of business or a hotel closes between the time you make your reservation and the time you arrive, the agent's responsibility is less clear.