Airlines forced to pay over $600m in passenger refunds amid pandemic woes |  CNN Politics

Airlines forced to pay over $600m in passenger refunds amid pandemic woes | CNN Politics



CNN

Airlines have refunded more than $600 million to hundreds of thousands of passengers for canceled or changed flights since the start of the Covid-19 pandemic, the Department of Transportation announced on Monday.

At the same time, federal regulators are cracking down on half a dozen airlines they say are bending the rules, which determine when refunds are issued. All of this comes as airlines struggle to keep up with a rapid increase in demand for air travel.

The department is also imposing $7.25 million in fines on the six airlines for “extreme delays in reimbursing these refunds to passengers,” Transportation Secretary Pete Buttigieg said in a call with reporters.

This brings the total fines issued for 2022 to $8.1 million – a civil penalty record for the department’s consumer protection program.

Ultra low-cost airline Frontier Airlines is the only US airline to face refund-related fines. Foreign-based carriers face the majority of fines: Air India, TAP Portugal, Aeromexico, El Al and Avianca.

“[T]he department expects that when Americans buy a ticket on an airline, we expect to arrive at their destination safely, reliably, and affordably. And our job at DOT is to hold airlines accountable to those expectations, many of which fall under law and regulation,” Buttigieg said.

Last month, the Department for Transport said that of the 7,243 consumer complaints it received about airlines in August, almost one in five concerned refunds.

The process for getting airlines to issue refunds varied from airline to airline, according to Blane Workie, DOT assistant general counsel for the Office of Aviation Consumer Protection, who spoke on the call. with Buttigieg.

For example, Frontier changed its definition of “significant schedule change” in March 2020.

“Essentially, they were retroactively applying a tougher rule to consumers, and I can definitely say that Frontier wouldn’t have provided these refunds to tens of thousands of passengers if the DOT hadn’t been involved,” she said. declared.

As part of the process, the DOT required Frontier to provide required refunds or advise all of these passengers on how to obtain refunds in case they needed to fill out forms.

Other airlines have experienced extreme delays in refunds, Workie said.

Most of the refund complaints the department received were against foreign air carriers, Workie noted.

Asked if this would have a chilling effect on airlines, Buttigieg said “the overall goal is to make sure passengers get their money back.”

“There should be no coercive action by the US Department of Transportation to compel airlines to pay the refunds they are required to pay. And so, I’ve asked the team to undertake an exercise to ensure fines are calibrated to deter this in the future and save passengers and everyone a lot of time,” he said. -he declares.

Buttigieg later noted that the department would continue to “increase the penalty side” until it sees less of this kind of behavior.

All refunds have been made or consumers should have been informed of the refund process, according to Workie.

However, the fines will be collected after the DOT orders are issued on Monday.

There are more enforcement actions and investigations underway, according to Buttigieg, who said “there may be more news to come in the form of fines.”

However, Workie said there are no ongoing refund investigations against US airlines.

Buttigieg also noted the upcoming holiday travel season, saying it is expected to be “among the busiest” since 2019, in terms of busy travel days.

He touted other measures the department is taking, including a new airline consumer services dashboard to help people see what’s owed to them when a flight is canceled or delayed due to a airline problem.

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