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US authorities slap fine on Dynamic for cancellations, refunds delays
The US Department of Transportation (DoT) has fined Dynamic International Airways, LLC, US$120,000 (estimate $24M) for delays in flights and processing passengers’ refunds.
Dynamic has been fined US$120,000 for consistently failing to notify passengers of cancellations and in delays of processing refunds.
In a consent order served Thursday, DoT disclosed that it concerns violations by Dynamic in relation to regulations on public charter operations with respect to providing prompt refunds to passengers after flight cancellations and promptly notifying passengers of the cancellations.
The violations also constitute violations of the regulations which prohibit unfair and deceptive practices and unfair methods of competition in air transportation.
The DoT order did not immediately say the complaints it investigated were from Guyana.
Dynamic conducts charter flights between Guyana and New York but had faced complaints about cancellations and delays in the past.
It is locally being handled by Roraima Airways.
Documents seen by Kaieteur News stated that Dynamic’s failure to promptly notify passengers of flight cancellations also violates the cease and desist provision made in March 2016.
“This order also concerns reporting delinquencies by Dynamic that constitute violations of 49 U.S.C. § 41708 and the accounting and reporting requirements specified in 14 CFR Part 241. This order directs Dynamic to cease and desist from future violations of the aforementioned regulations and statutes and Order, and assesses the carrier a compromise civil penalty of $120,000.”
DoT documents explained that Dynamic is a certificated air carrier based in Greensboro, North Carolina. It conducts single entity charter flights and direct sales public charter flights between the United States and points outside of the United States.
“Based on a significant increase of consumer complaints filed with the Department’s Aviation Consumer Protection Division against Dynamic in 2016, the Department’s Office of Aviation Enforcement and Proceedings (Enforcement Office) conducted an investigation of these complaints and found that in many instances, Dynamic failed to provide refunds in a timely manner to passengers affected by cancelled flights, as is required.
“In numerous cases, consumers had to wait for months to receive a refund. The Enforcement Office also found that in several cases, Dynamic also violated section 380.12(b) by failing to provide written notice to passengers after cancellations more than ten days out of their return flights. As a result, some passengers arrived at airports and were forced to purchase separate tickets from other airlines at the last minute.”
As a certificated carrier, Dynamic is required to comply with the Department’s reporting requirements.
“During 2016, Dynamic consistently failed to file in a timely manner applicable monthly and quarterly financial reports with the Department’s Bureau of Transportation Statistics as required by Sections 23-25 of Part 241.”
By way of mitigation and explanation, Dynamic states that it consolidated its flight operations in the summer of 2016 to focus on a few key markets to improve service, and that such consolidation resulted in numerous flight cancellations in a relatively short amount of time, which in turn resulted in an unusually large number of refunds that needed to be processed.
Dynamic stated that it has brought on additional personnel to address the refunds issue. Dynamic asserts that this situation was exacerbated by some passengers making double refund requests, one directly from Dynamic and one via a chargeback through the passenger’s credit card.
Dynamic alleged that this practice resulted in Dynamic, Dynamic’s escrow bank, and Dynamic’s credit card processor undertaking repeated lengthy reconciliations of passenger funds in escrow.
DoT’s Enforcement Office said it carefully considered the information provided by Dynamic and continues to believe that enforcement action is warranted.
“In order to avoid litigation, the Enforcement Office and Dynamic have reached a settlement of this matter, without admitting or denying the violations alleged in this order.
“This compromise assessment is appropriate considering the nature and extent of the violations described herein and serves the public interest. It represents a strong deterrent to future noncompliance with the Department’s requirements pertaining to public charters and reporting of financial data,” DoT explained in its order.
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