There are countless “claim agencies” that specialise in claiming EC261/2004 (EU261) compensation from airlines for flight delays, cancellations and overbooking in the European Union. Their promise is simple: They’ll chase up airlines for money legally owed under European laws, on behalf of airline passengers who lack the time or expertise to do it themselves.
Most work on a “no win, no fee” model. If they are successful, the agency will keep a portion of the payout. If they are unsuccessful, there is no fee to the client. But as it turns out, these services may not be entirely without risk!
In Episode 66 of the AFF on AIR podcast, you’ll hear from two Australian Frequent Flyer members – nicnet and SandyS – who ended up personally owing thousands of dollars to Finnair after trying to claim “EU261” compensation for flights that were significantly delayed due to aircraft mechanical problems.
These Finnair customers had engaged the services of a third-party claims agency, IfDelayed, to fight for compensation from the airline on their behalf. In doing so, they were told by the EU261 claim agency that “under no circumstances will you be liable to pay any costs or other penalties if we do not win your case”.
IfDelayed unfortunately lost the subsequent court case in Finland and was ordered to pay Finnair’s legal costs. Coincidentally, IfDelayed went bankrupt just a few months later. With IfDelayed’s new owner not liable to pay any of the old company’s debts, and its clients becoming unsecured creditors without their knowledge, Finnair then pursued the individual clients directly for the legal costs owed. And it seems they were legally entitled to do so.
This podcast explains in detail the unfortunate series of events that led to nicnet having to pay around €7,000 (AUD11,000) to Finnair, and SandyS owing almost AUD13,000, out of their own pockets and through no fault of their own.
You can read more about the developments in this story in SandyS’s thread on the Australian Frequent Flyer forum and in the article Finn-UNFair: Thousands Lost in Compensation Nightmare.
Also in this podcast episode, Matt explains how to maximise the value in Virgin Australia’s latest “double status credits” promotion.
Listen now to AFF on AIR Episode 66: “EU261 Claims Cost Finnair Passengers Thousands”
You can also view the episode notes. If you’d like to discuss this episode, ask Matt a question or suggest a topic for a future episode, you can join the discussion on the AFF on Air Discussion thread.
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