Will the federal government regulate frequent flyer programs?
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Marilyn Adams of USA Today details the U.S. Department of Transportation Inspector General’s report on the state of the airlines. Mostly unsurprising: Airlines aren’t consistently following their own published rules and guidelines regarding such things like compensation for voluntarily being bumped for a flight.
Airlines? Inconsistent? Big shock.
But buried in the article, there was this nugget:
Passengers can’t make informed decisions about which frequent-flier plans to join because airlines don’t explain policies or report annual frequent-flier mile redemptions in a consistent way, the report says. It recommends DOT consider new rules to standardize airlines’ public reports of frequent-flier mileage redemptions.
Whoa, now! That would be news.
The rules of these programs are indeed often byzantine, but more importantly, it’s hard to know, just by looking at the rules, how easily you’ll actually get the goodies you’re hoping to receive. For some time, airlines have claimed that award redemptions are just peachy, and that everyone who wants a seat can get one. They generally haven’t revealed whether tickets were being redeemed at the normal “saver” level, or at the doubly expensive “anytime” award level.
It sounds as if the DOT is proposing a level of government oversight over frequent flyer programs similar to the SEC’s regulation of accounting for publicly-traded corporations. The devil is in the details, of course.
But perhaps the threat alone of such regulation will spur the airlines to be more forthcoming with the real nitty-gritty details of their programs.



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