Passenger’s three-year $22,113 battle with Virgin Australia

A Queensland man who booked a dream holiday to the US with his family just before the pandemic has been told he’s not getting any of his money back.

A Queensland man who booked a dream holiday to the US with his family just before Covid has been told he’s not getting any of his $22,113 back.

Drew Koshemakin, 48, had spent seven years saving for the trip of a lifetime after promising his nephew, then 14 years old, that when he turned 21 he would take him to Las Vegas.

The day had finally come and on February 11, 2020, Drew booked three return business class flights (for himself, wife and nephew) from Brisbane to LA through Flight Centre.

He also booked a domestic flight with Virgin's then affiliate Delta, from LA to Las Vegas and accommodation for the duration of their two-week stay.

The trio were due to fly out on October 31, 2020, but when the pandemic hit, flights were grounded.

Drew Koshemakin, 48, booked a trip to Vegas to celebrate his nephew’s 21st birthday on October 31, 2020.

As a result Flight Centre refunded him just shy of $4000 for his domestic flights and the hotels — but Virgin could not do the same.

The airline entered into voluntary administration in April 2020 and as a result Drew was issued Future Flight credits of the same value to use by January this year — it was later extended to December 31.

A Virgin Australia spokesperson said because it does not hold any of the funds, it was not possible to give refunds to customers who booked flights or holidays before the company went into voluntary administration on April 20.

“Unlike our competitors, the new Virgin Australia business does not hold any of the funds customers paid for these bookings,” a Virgin spokesperson told news.com.au.

“These (Future Flight) credits expire on December 31, 2023, over three years since they were issued.”

He saved seven years to purchase $22,113 worth of return business class flights for himself, wife and nephew, but when the pandemic hit, flights were cancelled.

The spokesperson said as part of the administration process, the new owners of Virgin Australia sought approval from the Federal Court to issue Future Flight Credits to give impacted customers a way to recapture the full value of their bookings and credits, “rather than receiving a very small cash return as an unsecured creditor”.

Drew, who lives in Kallangur, north of Brisbane, said at the time there were still travel restrictions in place and there also wasn’t anything he could really book.

He hoped the airline would fly to the US again so he could fulfil his original trip, but it hasn’t happened.

It does, however, fly to six other international destinations including Bali — and as of June this year from Cairns to Tokyo — but Drew said it was a little too late.

“It is a lot of money just to go to Bali and I also don’t have the time to get off work,” he told news.com.au.

Virgin issued him with Flight Credits, instead of a refund, and he has since been trying to get his money back. Picture: Brendan Radke

“I have got a mortgage, bills and inflation has crept right up.

“I have had to tighten the belt on a few things and that money is just sitting there in limbo.

“I just want a fair go.”

He looked at using his credits with Virgin’s partners, like United Airlines, but he was told that wasn’t a possibility.

“Since they teamed up with United Airlines, I asked if I could use the flight credits with them – but they said no.”

On the Virgin website, it states that Future Flight credit can only be used on Virgin Australia operated flights, including any future services Virgin Australia operates.

The airline said Flight Credits relate to bookings made prior to Virgin Australia entering administration in April 2020 – and new Virgin business doesn’t hold any of the funds customers paid for these bookings.

“You’re unable to use your Future Flight credit with our codeshare and interline partners, with the exception of selected flights operated by Alliance Airlines for Virgin Australia to and from Brisbane airport. Your Future Flight credit can only be used on Virgin Australia operated flights, including any future services Virgin Australia operates,” it reads.

Meanwhile, those who have Covid Credits (bookings made from April 21, 2020 through July 31, 2022) can use it on the airline’s partners such as ANA, Singapore Airlines and United Airlines.

Adam Glezer, from Consumer Champion, who has been advocating on behalf of Drew, said it was not fair that those who booked prior to the pandemic were not being acknowledged in the same way as those who booked after.

“Those who have Covid Credits cannot only fly until 2025, but they can also use their credits to travel to a multitude of international destinations with Virgin’s partners,” he told news.com.au.

Adam Glezer, from Consumer Champion, said ‘at the very least’ Virgin should allow Flight Credit customers to use credits with its partner airlines – which it doesn’t do. Picture: Wayne Taylor

“I feel angry for those in Drew’s situation – and there’s many.”

Mr Glezer said at the very least Virgin should allow passengers who have Flight Credits to book their dream trip with its partner airlines.

“It’s not their fault their flights were cancelled due to Covid, and it seems as if Virgin don’t care that it’s going to cost families up to tens of thousands of dollars.

“It’s great that Virgin have the ACCC’s approval, but it’s a matter of right from wrong. It’s morally disgraceful.”

Drew said he was still keen to go to Las Vegas with his wife and nephew, but said once the credits expire at the end of the year, he’ll never be able to afford it.

The airline, however, has made it clear it won’t be extending the expiry date of its Flight Credits, adding it, together with its Covid Credits “have been extended multiple times” in recognition of the challenges Covid posed to travel.

“The Australian Competition and Consumer Commission (ACCC) has acknowledged Virgin Australia’s Future Flight Credits are different to ‘Covid Credits’ and has publicly confirmed that its position on extending credit expiry dates relates only to Virgin Australia’s ‘Covid Credits’, which have now been extended,” the spokesperson said.

Since January 2022, 2.4 million seats have been made available to be used with Future Flight Credits, with approximately 830,000 of those seats being used by Virgin customers.

The value of outstanding Future Flight Credits currently stands at $290 million.

This week the airline announced it has returned a profit for the first time in more than a decade, doubling its 2022 revenue with a reported $5 billion.