Is This Fraud? Airline Advertises, Sells Refundable Tickets Then Refuses Full Refunds

When you search the American Airlines website you may want the lowest fare, or you may want a refundable ticket. Most tickets that aren’t basic economy are changeable now without a fee, but you might not want to retain a credit with American Airlines (including because that credit will expire if unused).

Say, for instance, you were trying to get a seat on a flight to Australia when these flights were selling out. It’s business class, and expensive, and if you had to cancel (possible in uncertain Covid times) you didn’t want a huge travel credit to parcel out over cheap domestic flights you might take in the next year. American Airlines sells refundable tickets. And they even have a filter for that called flexible – or so they’d have you believe.

When you select a ‘business flexible’ fare here’s what they tell you about it:

You might buy a $10,000 airline ticket, thinking if you need to cancel you can get all of your money back. But that may not be true. The flexible search will bring up full fare business class if that’s all that’s available, but it’ll also bring up fares that will refund only most of your money and there’s no flag to tell you this before you buy.

After you’ve selected your fare, and gone to check out, underneath payment options is a box called fare rules with bullets and a link to ‘detailed fare rules’. If you click on it there’ll be long boxes of text and inside there may be something like:

CANCELLATIONS
ANY TIME
CHARGE USD 500.00/CAD 500.00 FOR CANCEL/REFUND.”

Even though you are explicitly searching for “flexible” and are assured you can refund, there’s a $500 charge for that refund. In airline speak it’s refundable but I do think it is deceptive to a layperson.

I can even point to a page on American’s website that says “business flexible” (what you’re searching for!) is *fully* refundable. They aren’t really describing this fare but there’s no reason you’d know that. Customers are searching for business flexible, and this page says business flexible is fully refundable.

Technically $500 refund fees are “disclosed” in fine print that you can find if you know where to look, only prior to actually hitting submit on payment. Ultimately though I think that airlines have made buying tickets too complicated, and do too poor a job of letting consumers know what they’re buying.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Yes, this has always struck me as deceptive on AA’s part. UA is much more honest about their “fully refundable” fares as they are truly fully refundable. And often are not much more expensive then the regular fares.

  2. American Scamlines.They suck no two ways about it.
    They regularly cancel flights and rebook them from other cities without even contacting me as an Exec Plat.I’m done with them! Sad excuse of an airline and a corrupt Ceo that has ruined the airline likely forever

  3. Of course it is fraud, it is a transaction involving a US airline. To bad the vast majority of Americans don’t have spines to stand up to them.

  4. Unbelievable. Someone must be looking at a class action lawsuit (I hope). This is sleazy on any level.

  5. Lawsuit wouldn’t work here since it’s preempted by federal law. Only the DOT can get them to knock it off. DOT complaints might help.

  6. Could this be the reason AA tried to remove the full disclosure/T&C sometime back in Sept 2020 but was forced to reinstate it? You reported on it back then.

  7. Buyer beware. If you aren’t smart enough to read and understand the fare rules that is a “you” problem. BTW AA isn’t the only company w often confusing rules are changes, refunds, exchanges etc.

    That is why I always read the fine print and understand it. The American public has gotten lazy and many don’t have the initiative or IQ to understand things. Again that is their issue. As long as a business disclosures the rules in whatever form or fashion they are required to do so that is good enough.

    We really shouldn’t have to dumb down things for the lowest common denominator!

  8. Lufthansa refused to refund several thousand dollars in two tickets for a flight they cancelled – telling the card issuer upon dispute that we purchased non-refudable tickets. We showed, Lufthansa didn’t. How’s that for lying and scamming?

  9. But they are refundable, just not fully refundable.
    There is a clear difference in airline terms.
    Refundable = can be fully refundable, but don’t have to be, can be refundable against a fee.
    In GDS: refundability (RF)

    Fully refundable= as the name says, NPE, no penalty in GDS

    unrestricted fare (NR) in GDS

    Flexible is exactly what it says, it’s flexible, meaning changes and cancellations are possible, it says nothing about how much a change / cancellations would cost

    If a customer is not confident enough to make a purchase without knowing the exact wording, then book via a travel agent, that’s what they are here for 🙂

  10. Glad you’re calling AA out, Gary.

    Too bad American Airlines and Marriott aren’t linked airline-hotel partners (instead of AA-Hyatt and United-Marriott), which would be a more consistent pairing in terms of their dismal Bonvoy-ness levels. Wish Hyatt-United would pair up instead.

  11. I wouldn’t make too many large purchases into the future on AA. This and so many other customer service issues, poor service standards, terrible planes, staff and equipment shortages points to a questionable future. Don’t think they would survive another BK.

  12. Surprised some State Attorney General has not pursued this under the Deceptive Trade Practices Act (DTPA). Seems to clearly meet the standard.

  13. @Mike, sadly in capitalist America, sh***y customer service means a company is more favorable to investors, not less, because it means the company is prudent with spending money. The majority of customers’ revealed preference (to borrow a term Gary loves to use to sound smart, even though no economist is smart) is that they would rather the Purser greet passengers at the boarding door with “Hurry up and get your a** seated so we can D0” instead of “Welcome aboard, it’s a pleasure to have you fly with us” if it means saving $0.01

  14. Nom it is not fraud. It is sleazy, sharp practice, very customer unfriendly, disgusting etc. etc. but not fraud. Why, simple. The refund charge fee is fully disclosed. Fraud is where you do something deliberately intended to deceive others. If you disclose the refund fee you are not trying to deceive, you are just being sleazy and disgusting.

  15. Not legal advice or expertise. Just common sense. “Refundable” is self explanatory and the onus is on the speaker to qualify it because in vernacular it is well established to mean a full refund. AA could have advertised partially refundable and avoided this mess. Charging $500 is not a “refund fee.” Instead it is a nonrefundable $500 deposit despite advertising the fare as refundable.

  16. TAP does this with their business class tickets with the added twist the refund fee applies per leg. So if you have four flights on your roundtrip ticket that is 4x the refund fee. Of course in Covid times they wouldn’t refund you anything but my CC had my back.

  17. Yeah. The fares are fully refundable, but the fee you’ll have to pay isn’t. And as long as the US government will keep bailing out these scumbag airlines, they’ll keep doing it. COVID in 2020 was a missed opportunity to let one of these horrible companies fail to put the fear in the rest.

  18. @Austinite: what does that say about someone who comes and reads and comments on a blog written by an economist who by your definition “isn’t smart”?

    @AC: first you say “The American public has gotten lazy and many don’t have the initiative or IQ to understand things” (which I am in agreement) but then you say “We really shouldn’t have to dumb down things for the lowest common denominator!” (which is exactly what must be done since the US loves to sue over every issue that they didn’t understand)

  19. When the airlines withhold your money but cancels your flight, does the money paid count for spend on the airline for status?

  20. Companies for years create naming conventions for their goods and services that legally mean nothing.

    Ford offers ecoboost. What the heck does that even mean? Try and take that to court and say I didn’t get ecoboost. They’ll laugh at you.

    Refundable and Fully Refundable have always been two very different things.

  21. @AC Gary is being generous to AA in how this is “disclosed.” If that was the way it was disclosed, it’s a whole different story. This is only a small portion of the page.

    This is how it is disclosed. Do you read these on any of the tickets you buy?

    Many of the rules don’t even apply to this itinerary.

    PENALTIES *SPECIAL EMERGENCY RULES *SUBJECT TO CHANGE AT ANYTIME – ORIGINATING AREA 1 – FOR TICKETING ON/BEFORE 31MAR21/FOR TRAVEL ON/AFTER 01MAR20 AND ON/BEFORE 31MAR21 IF TRAVEL ON THIS FARE COMPONENT MUST COMMENCE BY MIDNIGHT ON 31MAR22. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. TICKETS ISSUED ON/AFTER 01OCT20 ARE VALID FOR1 YEAR FROM DATE OF ISSUE. ‘ CHANGES ANY TIME CHANGES PERMITTED FOR REISSUE/REVALIDATION. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. THE ORIGINAL NON REFUNDABLE AMOUNT REMAINS NON REFUNDABLE. CHANGES PERMITTED PRIOR TO TICKETED DEPARTURE TIME OF EACH FLIGHT. —- TICKETS AT THESE FARES MAY NOT BE REVALIDATED. TICKETS MUST BE REISSUED. FARE DIFFERENCE AND CHANGE FEE MUST BE PAID AND TICKETS MUST BE REISSUED WHEN ITINERARY IS REBOOKED. —- A CHANGE IS A ROUTING / OR DATE / OR FLIGHT MODIFICATION. CHANGE IS PERMITTED WITHIN TICKET VALIDITY AS FOLLOWS. 1/WHOLLY UNUSED TICKETS ARE VALID PROVIDED TRAVEL COMMENCES WITHIN 18MONTHS FROM THE ORIGINAL TICKET ISSUE DATE AND ALL TRAVEL COMPLETED BY 31DEC21 OR 2/ PARTIALLY USED TICKETS ARE VALID PROVIDED TRAVEL IS COMPLETED WITHIN 18MONTHS OR BY 31DEC21 WHICHEVER COMES FIRST FROM THE OUTBOUND TRAVEL DATE ON THE ORIGINAL TICKET. ———————————————– WHERE THIS FARE IS COMBINED WITH ANOTHER FARE AND ONLY ONE FARE COMPONENT IS CHANGED THE PENALTY CONDITIONS OF THE CHANGED FARE COMPONENT WILL APPLY. WHEN MORE THAN ONE FARE COMPONENT IS BEING CHANGED THE HIGHEST PENALTY OF ALL CHANGED FARE COMPONENTS WILL APPLY. ———————————————– WHEN THE NEW ITINERARY RESULTS IN A HIGHER FARE THE DIFFERENCE WILL BE ADD COLLECTED AND THE CHANGE FEE WILL APPLY. —- WHEN THE NEW ITINERARY RESULTS IN A LOWER FARE THE DIFFERENCE WILL BE REFUNDED TO THE ORIGINAL FORM OF PAYMENT. ————————————————- CALCULATION FOR REISSUES //CHANGES BEFORE OUTBOUND DEPARTURE// THE ITINERARY MUST BE REPRICED USING CURRENT FARES IN EFFECT ON THE DATE THE TICKET IS REISSUED. OR REPRICE THE ITINERARY USING THE SAME FARE BASIS CODES AND RULES AS THOSE IN EFFECT ON THE DATE OF ORIGINAL TICKET ISSUANCE FOR UNCHANGED OUTBOUND FARE COMPONENTS AND USING FARES IN EFFECT ON THE DATE OF NEW TICKET ISSUANCE FOR ALL CHANGED FARE COMPONENTS. ————————————————– //CHANGES AFTER DEPARTURE// THE ITINERARY MUST BE REPRICED USING HISTORICAL FARES IN EFFECT ON THE PREVIOUS TICKETING DATE. ————————————————– THE NEW ITINERARY MUST MEET ALL RULE PROVISIONS OF THE NEWLY TICKETED FARE – I.E. ADVANCE RESERVATIONS/TICKETING DEADLINE/MINIMUM/MAXIMUM STAY/BOOKING CLASS/SEASONALITY ETC. ———————————————— WHEN COMBINING FARES THAT HAVE CANCELLATION FEES THE HIGHEST CANCELLATION FEE OF EACH CANCELLED PRICING UNIT APPLIES ORIGINATING AUSTRALIA – FOR TICKETING ON/BEFORE 31MAR21/FOR TRAVEL ON/AFTER 01MAR20 AND ON/BEFORE 31MAR21 IF TRAVEL ON THIS FARE COMPONENT MUST COMMENCE BY MIDNIGHT ON 31MAR22. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. TICKETS ISSUED ON/AFTER 01OCT20 ARE VALID FOR 1 YEAR FROM DATE OF ISSUE. CHANGES ANY TIME CHANGES PERMITTED FOR REISSUE/REVALIDATION. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. THE ORIGINAL NON REFUNDABLE AMOUNT REMAINS NON REFUNDABLE. CHANGES PERMITTED PRIOR TO TICKETED DEPARTURE TIME OF EACH FLIGHT. —- TICKETS AT THESE FARES MAY NOT BE REVALIDATED. TICKETS MUST BE REISSUED. FARE DIFFERENCE AND CHANGE FEE MUST BE PAID AND TICKETS MUST BE REISSUED WHEN ITINERARY IS REBOOKED. —- A CHANGE IS A ROUTING / OR DATE / OR FLIGHT MODIFICATION. CHANGE IS PERMITTED WITHIN TICKET VALIDITY AS FOLLOWS. 1/WHOLLY UNUSED TICKETS ARE VALID PROVIDED TRAVEL COMMENCES WITHIN 18MONTHS FROM THE ORIGINAL TICKET ISSUE DATE AND ALL TRAVEL COMPLETED BY 31MAR22 OR 2/ PARTIALLY USED TICKETS ARE VALID PROVIDED TRAVEL IS COMPLETED WITHIN 18MONTHS OR BY 31MAR22 WHICHEVER COMES FIRST FROM THE OUTBOUND TRAVEL DATE ON THE ORIGINAL TICKET. ———————————————– WHERE THIS FARE IS COMBINED WITH ANOTHER FARE AND ONLY ONE FARE COMPONENT IS CHANGED THE PENALTY CONDITIONS OF THE CHANGED FARE COMPONENT WILL APPLY. WHEN MORE THAN ONE FARE COMPONENT IS BEING CHANGED THE HIGHEST PENALTY OF ALL CHANGED FARE COMPONENTS WILL APPLY. ———————————————– WHEN THE NEW ITINERARY RESULTS IN A HIGHER FARE THE DIFFERENCE WILL BE ADD COLLECTED AND THE CHANGE FEE WILL APPLY. —- WHEN THE NEW ITINERARY RESULTS IN A LOWER FARE THE DIFFERENCE WILL BE REFUNDED TO A TRAVEL VOUCHER FOR TRAVEL ON AA ONLY. ————————————————- CALCULATION FOR REISSUES //CHANGES BEFORE OUTBOUND DEPARTURE// THE ITINERARY MUST BE REPRICED USING CURRENT FARES IN EFFECT ON THE DATE THE TICKET IS REISSUED. OR REPRICE THE ITINERARY USING THE SAME FARE BASIS CODES AND RULES AS THOSE IN EFFECT ON THE DATE OF ORIGINAL TICKET ISSUANCE FOR UNCHANGED OUTBOUND FARE COMPONENTS AND USING FARES IN EFFECT ON THE DATE OF NEW TICKET ISSUANCE FOR ALL CHANGED FARE COMPONENTS. ————————————————– //CHANGES AFTER DEPARTURE// THE ITINERARY MUST BE REPRICED USING HISTORICAL FARES IN EFFECT ON THE PREVIOUS TICKETING DATE. ————————————— ———– THE NEW ITINERARY MUST MEET ALL RULE PROVISIONS OF THE NEWLY TICKETED FARE – I.E. ADVANCE RESERVATIONS/TICKETING DEADLINE/MINIMUM/MAXIMUM STAY/BOOKING CLASS/SEASONALITY ETC. ———————————————— WHEN COMBINING FARES THAT HAVE CANCELLATION FEES THE HIGHEST CANCELLATION FEE OF EACH CANCELLED PRICING UNIT APPLIES FARE RULE CANCELLATIONS ANY TIME CHARGE USD 500.00/CAD 500.00 FOR CANCEL/REFUND. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. IN THE CASE OF THE DEATH OF THE PASSENGER/ OR A TRAVELING COMPANION/THE SERVICE CHARGE MAY BE WAIVED OR THE TICKET REFUNDED. VISIT AA.COM FOR DETAILS. ———————————————— FOR TRAVEL AGENCY BOOKINGS MADE IN MEXICO / THE CARIBBEAN / CENTRAL AND SOUTH AMERICA – AA WILL ASSESS A USD 50.00 FEE ON ANY UNTICKETED RESERVATION NOT CANCELLED BEFORE DEPARTURE. ———————————————— WHEN COMBINING FARES THAT HAVE CANCELLATION FEES THE HIGHEST CANCELLATION FEE OF EACH CANCELLED PRICING UNIT APPLIES -WITH THE FOLLOWING EXCEPTION- WHEN COMBINING A REFUNDABLE FARE WITH A NON- REFUNDABLE FARE THE ENTIRE PRICING UNIT WILL BE NON-REFUNDABLE. ———————————————— THE ORIGINAL NON-REFUNDABLE FEE AMOUNT REMAINS NON-REFUNDABLE. REFUND PERMITTED WITHIN TICKET VALIDTY. ———————————————— INFANT DISCOUNTS APPLY. CHILD DISCOUNTS DO NOT APPLY. ANY TIME CHARGE USD 800.00/CAD 800.00 FOR NO-SHOW/REFUND. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. IN THE CASE OF THE DEATH OF THE PASSENGER/ OR A TRAVELING COMPANION/THE SERVICE CHARGE MAY BE WAIVED OR THE TICKET REFUNDED. VISIT AA.COM FOR DETAILS. ———————————————— FOR TRAVEL AGENCY BOOKINGS MADE IN MEXICO / THE CARIBBEAN / CENTRAL AND SOUTH AMERICA – AA WILL ASSESS A USD 50.00 FEE ON ANY UNTICKETED RESERVATION NOT CANCELLED BEFORE DEPARTURE. ———————————————— WHEN COMBINING FARES THAT HAVE CANCELLATION FEES THE HIGHEST CANCELLATION FEE OF EACH CANCELLED PRICING UNIT APPLIES – WITH THE FOLLOWING EXCEPTION- WHEN COMBINING A REFUNDABLE FARE WITH A NON- REFUNDABLE FARE THE ENTIRE PRICING UNIT WILL BE NON-REFUNDABLE. ———————————————— THE ORIGINAL NON-REFUNDABLE FEE AMOUNT REMAINS NON-REFUNDABLE. REFUND PERMITTED WITHIN TICKET VALIDTY. ———————————————— INFANT DISCOUNTS APPLY. CHILD DISCOUNTS DO NOT APPLY. CHANGES ANY TIME CHANGES PERMITTED. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. A CHANGE IS A ROUTING / OR DATE / OR FLIGHT MODIFICATION. CHANGE IS PERMITTED WITHIN TICKET VALIDITY OF ORIGINAL TICKET. TICKETS MUST BE REISSUED FOR ALL VOLUNTARY CHANGES. ————————————————– WHERE THIS FARE IS COMBINED WITH ANOTHER FARE THE PENALTY CONDITIONS OF THE CHANGED FARE COMPONENT WILL APPLY. ————————————————– CALCULATION OF REISSUES //CHANGES BEFORE OUTBOUND DEPARTURE// WHEN THE FIRST FARE COMPONENT IS CHANGED THE ITINERARY MUST BE REPRICED USING CURRENT FARES IN EFFECT ON THE DATE THE TICKET IS REISSUED. —– WHEN THERE ARE NO CHANGES TO THE FIRST FARE COMPONENT BUT OTHER FARE COMPONENTS ARE CHANGED THE ITINERARY MUST BE REPRICED USING HISTORICAL FARES IN EFFECT ON THE PREVIOUS TICKETING DATE OR CURRENT FARES IN EFFECT ON THE DATE OF TICKET REISSUE WHICHEVER IS LOWER. ————————————————– //CHANGES AFTER DEPARTURE// THE ITINERARY MUST BE REPRICED USING HISTORICAL FARES IN EFFECT ON THE PREVIOUS TICKETING DATE. —– WHEN THE NEW ITINERARY RESULTS IN A HIGHER FARE THE DIFFERENCE WILL BE COLLECTED. —– WHEN THE NEW ITINERARY RESULTS IN A LOWER FARE A REFUND OF THE RESIDUAL AMOUNT LESS THE APPLICABLE PENALTY WILL BE MADE. —– REISSUES/EXCHANGES NOT ALLOWED TO EOU/ERU FARE TYPES. INVOLUNTARY CHANGES ANY TIME INVOLUNTARY CHANGES PERMITTED FOR REISSUE/ REVALIDATION. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. NO FEES APPLY IN CERTAIN CIRCUMSTANCES UNDER THE AUSTRALIAN CONSUMER LAW – APPLICABLE LOCAL LAW – OR CONDITIONS OF CARRIAGE ANY TIME INVOLUNTARY CHANGES PERMITTED FOR CANCEL/REFUND. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. ‘ NO FEES APPLY IN CERTAIN CIRCUMSTANCES UNDER THE AUSTRALIAN CONSUMER LAW – APPLICABLE LOCAL LAW – OR CONDITIONS OF CARRIAGE ANY TIME INVOLUNTARY CHANGES PERMITTED FOR NO-SHOW/REFUND. NOTE – TEXT BELOW NOT VALIDATED FOR AUTOPRICING. NO FEES APPLY IN CERTAIN CIRCUMSTANCES UNDER THE AUSTRALIAN CONSUMER LAW – APPLICABLE LOCAL LAW – OR CONDITIONS OF

  22. It’s a restocking fee, just like at Best Buy, not fraud.

    Not!

    I recommend sharing it with all 3 of your members of Congress. It could not be more fraudulent.

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