Frontier Airlines ordered to pay millions to customers who were denied refunds

Nov. 15 (UPI) -- Frontier Airlines and five foreign carriers that operate in the United States have been ordered to pay more than $600 million to passengers who were denied cash refunds after their flights were canceled due to COVID-19 lockdowns.

The budget carrier will pay back $222 million in refunds, which is the biggest individual fine announced Monday by the U.S. Department of Transportation.

The remaining $400 million in fines will be split among five airliners based in other countries. They include Air India, which was ordered to pay $1.4 million; TAP Portugal, which will pay $1.1 million; Aeromexico and Israel's El Al will each pay $900,000; and Colombia-based airliner Avianca will give back $750,000.

Another $2.2 million is designated for customers who encountered delays while seeking to get their money back.

Travelers should immediately qualify for a refund when a flight gets canceled, but in these cases many customers said they were offered vouchers instead of money as demand for tickets fell and forced carriers to cut flights throughout 2020 and 2021.

Meanwhile, refund complaints in the U.S. surged to 87% in 2020 (89,227 of 102,560), but came down to 60% a year later (29,974 of 49,958).

The Department of Transportation has proposed tighter rules that would protect customers in situations where refunds become an issue.

The federal penalty on the airliners comes amid growing pressure on the industry from the Biden administration to lower costs for consumers amid surging inflation. Over the spring and summer, Transportation Secretary Pete Buttigieg called out the major airlines over mounting flight delays and cancellations.

Pilots have also been demanding better pay as lockdown measures ease and airlines bounce back financially.

Frontier profited $31 million during the third quarter of 2022 while also raking in $906 million in revenue.

"It shouldn't take an enforcement action from the U.S. Department of Transportation to get airlines to pay refunds that they're required to pay," Buttigieg told reporters from Washington on Monday.