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Qantas’ phantom flights – what’s the scam?

by Kim Wingerei | Aug 31, 2023 | What's the scam?

The ACCC has launched Federal Court action against Qantas, alleging the airline continued selling tickets on flights already cancelled. It begs the question of who knew, when did they know, and why didn’t they tell?

The ACCC alleges that Qantas has:

engaged in false, misleading or deceptive conduct, by advertising tickets for more than 8,000 flights that it had already cancelled but not removed from sale.

“The ACCC has conducted a detailed investigation into Qantas’ flight cancellation practices. As a result, we have commenced these proceedings alleging that Qantas continued selling tickets for thousands of cancelled flights, likely affecting the travel plans of tens of thousands of people,” ACCC Chair Gina Cass-Gottlieb said in the statement to the ASX.

ACCC launches legal action against Qantas over tickets

Meanwhile, Alan Joyce has been spruiking the record results of $2.47b profits, while incoming CEO Vanessa Hudson is on record insisting “Qantas had got the balance right between shareholders and customers”. This was just last week, and they were both dismissive of the avalanche of criticism coming their way regarding poor service, baggage (mis)handling, refund delays, and price gouging. And apparently ignorant of an imminent Federal Court case alleging serious misconduct.

The ACCC does not operate in a vacuum or in secrecy. Nor is court action the first tool they go for when discovering illegal conduct. Quite the contrary, the ACCC will use “,,,enforcement action, consumer and business education, industry engagement, research and advocacy.” To wit, according to the ACCC press release, “The ACCC’s investigation included engagement with impacted consumers,

and the serving of compulsory information notices on Qantas.

In other words, Qantas knew.

The ACCC has most likely spent months extracting detailed information from Qantas. Flight cancellations are not a matter of public record per se, but only become public information when customers are informed and/or flights are removed from sale.

A Federal Court action of this nature is a serious issue for any business. And especially for an ASX listed company which is subject to continuous disclosure rules – meaning it has to release material – “market sensitive” – information immediately. Given the publicity shitstorm Qantas is in, for Joyce et al. to think a Federal Court action is not market sensitive beggars belief.

Penalties for the alleged breaches are a minimum of $10m (each) and could be as much as “10% of the corporation’s turnover” (sales). That’s not immaterial even for Alan Joyce.

Finally, did the board know, and if not, why not? And if they did, why did they not disclose it?

Joyce, Hudson, Chairman Goyder and the rest of the Qantas board are all complicit in what is just the last of a long string of scandals surrounding the company they are the custodians of. Another day, another scam. Where will it end?

And why did they do it? To get their ‘yield’ up, eek out a bigger profit by disadvantaging customers again? “Probably didn’t have the aircraft or the crew,” a Qantas insider told MWM.

The most telling line in the ACCC release was that one of the reasons was “network optimisation” which seems to be jargon for optimising profit from the network by cancelling flights for commercial reasons – therefore profiteering again at the expense of customers, and making profits on false grounds. There’s a word for that.

Alan Joyce to depart. Is it time for Qantas to retire Jetstar too?

Kim Wingerei is a businessman turned writer and commentator. He is passionate about free speech, human rights, democracy and the politics of change. Originally from Norway, Kim has lived in Australia for 30 years. Author of ‘Why Democracy is Broken – A Blueprint for Change’.

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