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Credit Card Applications » News » Other » Senator Calls For Proper Disclosure Of Frequent Flier Programs

Senator Calls For Proper Disclosure Of Frequent Flier Programs

February 28, 2010
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Customers of frequent flier programs need not worry anymore as Senator Charles Schumer, calls for the review of any kind of deceptive business practice. This is in line with the growing number of cases in terms of the cancellation of miles without properly alerting customers.

He noted that customers must be given substantial notification from the airlines about the expiration date of their airline rewards. In this case, customers can decide as to what they want to do with the miles. Schumer is calling for the Department of Transportation to set up rules in improving disclosure policies, drawing limitations on miles cancellation, and checking the accounting treatment of the points.

This act by the Senator is a result of the American Express alerting their card holder customers that they cannot transfer their 2010 rewards to their loyalty account anymore if they are late in paying bills. Otherwise, if they wish to reinstate the airline rewards, they can pay 29 dollars as a fee.

The said act is co-branded by Jetblue, Hilton, Delta and Starwood Hotels.

As per recent statistics, there is an estimated 10 trillion miles that is in circulation today. This is worth around $165 billion. Twenty percent of these points are no longer redeemable.

This call of the Senator is backed up by the Association for Airline Passenger Rights in view of the fact that they have received a lot of complaints from different travelers. These travelers assert that their miles are expiring even when they follow the terms and conditions of the frequent-flier programs. Same with the Passenger Advocacy Group, Executive Director Brandon Macsata, stated that the airlines are making a lot of gimmicks and tactics in terms of this program.

However, according to James May, from the Air Transportation Association, federal effort cannot be an assurance to remedy this problem. This is because it is the airlines that are in total control of the terms and conditions of their programs such as advance notice and major changes.

It can be recalled that American Express introduced this program that resulted in an overwhelming increase of members to around 180 million. Their partnerships with some retailers made airline rewards easier to deal with. However, with blackout dates in terms of expiration policies and conditions today, the rewards system is said to be harder than ever.

In the end, InsideFlyer's Randy Peterson strongly notes that this call from Schumer will not succeed. He said that it is up to the customers to manage and pay appropriate attention to their miles to take advantage of it.

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