Consumers, lawmakers rip airlines for withholding refunds

AP – When her Las Vegas hotel shut down and returned her money, and both Nevada and her home state of Ohio issued stay-home orders, Helen Moon cancelled the flight that she and her husband had booked on Frontier Airlines and asked for a cash refund.

No dice. Frontier offered only a travel credit instead of the refund because Moon – and not the airline — cancelled the USD970 reservation.

“We were following the government restrictions, they said shelter in place, and we had nowhere to sleep,” Moon said. “Why would you fly somewhere if you had no accommodations?” There are thousands of other airline customers just like Moon who cancelled bookings because of the coronavirus epidemic and can’t get their money back.

Some Senate Democrats are picking up the issue.

“At a time when families are struggling to pay for food, for housing, for prescriptions, it’s absolutely unconscionable that the airlines won’t return this money to consumers,” Senator Edward Markey, D-Mass, said during an online news conference with consumer groups.

Markey and four other Senate Democrats proposed legislation on Wednesday that would require airlines to give full cash refunds to passengers during the pandemic, even if it was the customer who cancelled. They said they will try to include the requirement in any further virus-relief measures.

The senators have previously estimated that airlines are holding back more than USD10 billion by refusing to pay cash refunds.

Director of Financial Policy for Consumer Reports Anna Laitin said in some cases airlines have pushed vouchers even when it was the airline that cancelled the flight. Industry officials said that problem has been fixed.

The airlines are struggling to survive a 90 per cent drop in air travel due to the pandemic. US carriers are burning through at least USD350 million a day, according to their trade group, Airlines for America.