DOT Summary

This afternoon, the Department of Transportation offered the following guidance about travelers stuck in limbo or wondering about refunds:

Direct Air was authorized by the Department to operate public charter flights between numerous cities and Myrtle Beach, S.C., and points in Florida. Under Department regulations, Direct Air was required to have in place an escrow account into which all charter participant funds were to be deposited until payment was made to the airline that was to perform their charter flights. The Department is investigating the handling of that escrow account. In addition, as required by Department rules, Direct Air has in place a surety bond in the amount of $200,000 protecting charter participant payments.

The company has announced that it intends to restart operations as of May 15, 2012; however, the company currently does not have authority to do so and that announcement does not affect consumers who currently are in mid-trip or who had paid for but had not yet begun travel under the current program that has been canceled.

At this time, it is unclear whether consumers who have completed the outbound portion of their trip and need to return home will be provided return transportation by Direct Air but we have been advised that the company is working with the airlines involved with its charter program to provide return flights. Direct Air has established a toll-free number that should be operational at the time of publication of this fact sheet or shortly thereafter to provide consumers more information about this matter. That number is 1-855-888-8090.

Obtaining a Refund

Consumers affected by Direct Air's cessation of service who are due a refund need to be able to prove to the escrow bank and surety bond company that they purchased charter air transportation or an air charter tour package from Direct Air. Documents that may accomplish that might include a Direct Air receipt or invoice, or possibly the consumer's credit card purchase record.

Under Department rules, consumers may request a refund from Direct Air by writing to the company at 1600 Oak Street, Suite B, Myrtle Beach, SC 29577, with copies sent to the company's escrow depository bank, Valley National Bank, 1455 Valley Road, Wayne, NJ 07470, and to the holder of its surety bond, Platte River Insurance Company, Alejandro Navarro, Attorney-in-Fact, 700 A Lake Street, Ramsey, NJ 07446. Claims made under the surety bond must be made within 60 days of the date of the originally-scheduled return air transportation. Claims are limited to the amount paid by the consumer for the charter air transportation or air charter tour package.

Credit and Debit Card Refunds


Customers who paid Direct Air by credit card may be entitled to a credit from their credit card company under the Fair Credit Billing Act. Write to your credit card issuer, being sure to state your account number. Enclose a photocopy of your credit card statement, if you have received one, and a photocopy of your ticket, itinerary or receipt if possible, or indicate the price of the transportation and the date it was purchased. State that Direct Air has ceased operations, that you will not receive the product that you charged to your account (i.e., the comprehensive tour), and that you are requesting a credit pursuant to the Fair Credit Billing Act.

The credit card issuer must receive this notice no later than 60 days after the date that you received the first monthly statement that listed the Direct Air charge, although credit card companies sometimes waive this deadline for future transportation. If you have a paper ticket or other evidence of your transportation, some credit card issuers may ask for the original unused ticket or other documentation. If this is requested, keep a photocopy and send the original by certified mail. Do not send the original documentation unless it is requested. However, it would be a good idea to enclose a copy of any confirmation or itinerary sheet that you may have received.

There are no federal protections for debit card purchases of the type described above for credit cards. However, some debit card issuers voluntarily provide some or all of those protections. If you paid by debit card, check with your debit card issuer regarding your refund rights.