Hotel booking cancellation

Apologies if this is the wrong place for this question. Back in may I booked
2 double rooms in a London hotel for 1 night - that night being 15/07/2006.
I left my credit card details (as requested) to confirm the booking. Today I
received an email stating that my credit card details had been rejected and
the booking cancelled. I phoned the hotel and was told the same thing and
that I could not re-book using another credit card as they were full. I
called my credit card company and they assured me that there had been no
enquiry for authorisation on my account whatsoever and if there had been it
would not have been rejected for any reason. I am assuming that the hotel
decided that they would rather hire out the rooms for someone for at least 2
nights and so decided to spin me some bu££$hit. Transportation to London
has been paid for, tickets to various attractions purchased and now we can't
go unless we want to spend at least twice as much on a room as we had
planned. To I have any options here?