Congress is certainly not wanting for policy battles: Health care. The economy. Afghanistan.
And frequent flier miles?
Apparently so. Sen. Charles Schumer, D-N.Y., has called for an investigation into airline and credit card companies slashing frequent flier miles and accounts.
Schumer says fliers have lost tens of millions of miles that have been rescinded by airlines and credit card companies, and that consumers are not being sufficiently notified about such penalties.
“As the holiday travel season approaches, we cannot let airlines and credit card companies continue to fly off with hard-earned frequent flier miles,” Schumer said. “Playing games with frequent flier miles takes money out of people’s pockets, plain and simple. It’s annoying, it’s unfair and it has to stop.”
Schumer called on the Department of Transportation to investigate whether air carriers were engaging in deceptive business practices. He also asked the agency to draw up new rules to improve disclosure and set limits on when miles can be rescinded and accounts can be closed.
Starting in January, American Express will not issue miles or points on some accounts during a period in which the customer’s bill is late. Cardholders can restore the rewards once they’re up to date on their bills — for a $29 fee.
Chopping frequent flier miles is nothing new, said Randy Peterson, editor of Inside Flyer magazine. What has changed, he said, is the ever-shrinking time periods in which the miles are still valid.
Some airlines cancel after one year and charge $50 for reinstatement, and others cancel the account after 18 months and charge 1.25 cents per mile plus a $25 fee for reinstatement.
That airlines cancel miles isn’t the problem, because the practice has been going on for so long, Peterson said. But when they’re arbitrarily terminated or chopped without warning, consumers end up feeling the crunch.
“This is like kicking somebody when they’re down,” he said.
