Australia’s Qantas Airways duped nearly 1 million passengers in fake flights scandal

Qantas Airways Ltd.’s ghost-flight scandal misled almost one million customers booked on tens of thousands of non-existent services, according to court documents that reveal the scale of the misconduct and the airline’s awareness of the problem.

Qantas settled the lawsuit in May, agreeing to pay A$120 million (US$82 million) in fines and compensation for selling tickets on flights it had already decided to cancel. The Australian carrier also admitted misleading ticket holders by not telling them promptly they were actually booked on phantom services.

The bombshell allegations led to the premature departure of Chief Executive Officer Alan Joyce last year, but it wasn’t clear at the time how much Qantas knew about its own ticketing deficiencies. The case was brought by the Australian Competition & Consumer Commission, which had sought a record penalty of more than A$250 million.

Thursday’s statement of agreed facts and admissions, posted on the Federal Court of Australia’s website, said “senior managers” at Qantas collectively knew of all the impacts on passengers, but no single person was privy to the whole picture.

“Qantas was aware of the way in which its system operated,” the filing said. “Consumers suffered harm as a result of Qantas’s contravening conduct.”