DOT to Fine American Over Vouchers

By David Koenig
|  Monday, Feb 28, 2011  |  Updated 12:57 PM CDT
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DOT to Fine American Over Vouchers

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The government fined American Airlines for failing to tell passengers it would cost up to $30 to redeem vouchers they got for giving up seats on oversold flights.

American stopped charging the fees late last year. It agreed to pay half the $90,000 fine, and the other half will be waived if the airline complies with federal rules on the vouchers for one year.

American issues about 250 such vouchers every day. The Transportation Department said Monday it's the first time the government has fined an airline for failing to disclose fees to use the vouchers.

Airlines are allowed to oversell flights on the theory that some passengers won't show up. When there are too many ticketed passengers, airlines must ask for volunteers to give up their seats before bumping people who don't want to get off the plane. Airlines must compensate bumped passengers.

When passengers tried to cash in the vouchers, they were charged a standard American Airlines fee for buying tickets over the phone or at the airport. Unlike tickets, which can be bought over the Internet, American did not allow vouchers to be redeemed online.

"There's no way of getting out of paying that fee if they want to redeem" the vouchers, said Transportation Department spokesman Bill Mosley.

American spokesman Tim Smith said the airline stopped charging passengers to redeem the vouchers over the phone in 2007 and at airport ticket counters last year. He said the airline removed the fee before the government complained.

American still doesn't allow customers to redeem the vouchers online, much as it doesn't allow customers to pay bag-checking fees online -- they are typically collected at the airport before the flight.

American is a unit of Texas-based AMR Corp., the nation's third-largest airline company.

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