The U.S. Department of Transportation is seeking a $25.5 million US penalty against Air Canada for “failing to provide consumers prompt refunds” after cancelling their flights amid the COVID-19 pandemic.
In a “notice of enforcement proceeding” issued by the department on Tuesday, the Office of Aviation Consumer Protection says Air Canada “unlawfully failed to provide timely refunds” for flights between the United States and Canada that were cancelled or significantly changed.
The agency says it received more than 6,000 refund complaints since March 1, 2020, and has notified Air Canada multiple times over the past year of its view that the airline’s stance “lacks merit.”
“OACP asserts that Air Canada has committed a minimum of 5,110 violations and passengers waited anywhere from five months to 13 months to receive refunds,” the department said in a release.
It says Air Canada has argued it is not required to provide reimbursement, citing the unique circumstances of the pandemic.
Air Canada agreed in April to refund passengers whose flights were cancelled as part of a federal aid package worth up to $5.9 billion.
Multiple airlines refused for months to reimburse customers who paid for services that were never rendered, as travel advisories and border closures cratered the airline industry.