Q. When that check is drawn to Eastern Airlines, that amount would be deducted from the amount of your billing?

A. That is right.

Mr. O'CONNOR. May I have the Northwest vouchers, please?

By Mr. O'CONNOR:

Q. I show you an exhibit which is identified in the record as "Givens No. 2," which is Northeast Air Lines ticket 11/110/850/991 issued in the name of S. Givens on August 20, Miami to Washington.

Can you tell us whether that ticket was purchased by travel credit card or whether it was paid for in cash or otherwise?

A. It appears it was purchased against an air travel card.

Q. How do you determine that?

A. In the "Form of payment" box it has "ATP.”

Q. What does that stand for?

A. Air travel plan.

Q. So from your examination of that receipt there, it would indicate that the travel Miami to Washington was acquired through an air travel card?

A. Yes, sir.

Q. Can you tell from that ticket, what we have there, the particular air travel card that was involved?

A. No, sir.

Q. Now, from your records, can you tell whether Northeast has billed your account for this travel?

A. If they have, we can tell you.

Q. Do you have that record with you? Could we show you the committee record?

Mr. O'CONNOR. Are your records adequate for him to determine? Mr. GRAY. No, I think we will have to go to his record.

By Mr. O'CONNOR:

Q. I will ask you to examine your records and submit a memorandum to us as to the billing on this particular ticket. Any details on it you can obtain from Mr. Gray here.

A. Very well.

Q. On American Airlines ticket 1/321/416/220, which is a part of Givens exhibit 2, there appears the note "ATP refund." Can you tell us what that item is?

A. This coupon is apparently submitted for refund credit to the account by American Airlines. American Airlines came into possession of this coupon from the ticketholder, apparently, with a request to refund the ticket. The ticket was refunded by credit to the air travel account.

Q. would that refund be the face amount of that ticket or the portion that was not used?

A. Just the portion that was not used.

Q. Do you happen to know the value of the portion, Miami to New York?

A. Yes, sir; this is the correct amount.

Q. What is the amount?

A. $75.50, including tax.

Q. $75.50 is the amount refunded?

A. Yes.

Mr. O'CONNOR. I have no further questions of this witness.

Mr. HAYS. Mr. Grayson, is it or is it not possible for somebody to turn in a ticket or a portion of a ticket which was bought on a credit card and receive cash from the airlines?

The WITNESS. Under certain conditions, yes, sir. Mr. HAYS. That was an unexpected answer. could do that. Will you tell us the conditions?

I didn't know you

The WITNESS. Under conditions over which the passenger has no control. The carriers are permitted to give them cash for the tickets so they can continue their journey by other means of transportation. For example, if the flight is canceled and there are no airlines operating so that he can't use his air travel card, for example, to buy a ticket, and he needs to buy a railroad ticket or bus or what-haveyou, then we will refund in cash.

Mr. HAYS. And that would be noted on your records?

The WITNESS. This is known as an involuntary refund.

Mr. HAYS. You wouldn't make those except if there were no airline flights available and you had to go over to some other means of transportation?

The WITNESS. Yes.

Mr. HAYS. If a man walked into an airline ticket counter, yours or anybody else's, just walked in off of the street and said, "I have a ticket here I would like to get a refund on," and it was bought on an ATP card, you wouldn't refund it?

The WITNESS. No, sir.

Mr. HAYS. It is against your rules and the rules of all other arilines? The WITNESS. Yes, sir.

Mr. HAYS. So, only in the case of exceptional circumstances-I will repeat this to make sure we have it clear in the record-only in exceptional circumstances where the passenger is grounded and no other airline transportation is available and it would be a hardship, you then give him cash to purchase other transportation? The WITNESS. That is right.

By Mr. O'CONNOR:

Q. Are there exceptions to that sometimes and maybe the local offices slip up on it?

A. That has been known to happen.

Q. Particularly if a prominent individual insisted upon receiving the cash?

A. It could happen; yes, sir.

Q. In other words, it has occurred in the past?

A. Yes.

Q. Outside of the exception you gave?

A. Yes.

Mr. HAYS. But your records would show that, that it was either refunded for cash or credit?

The WITNESS. Yes.

Mr. DICKINSON. We have had a number of tickets that have been purchased by the committee and either half of them used or maybe they weren't used at all and there is just no record of them ever being used. Is this unusual as far as your records are concerned? Are there many tickets lost by you or is it possible that they could have been used and your records would not show this?

72-404 0-67 -16

The WITNESS. It is possible, yes, sir.

Mr. DICKINSON. Does it happen every once in a while that this comes up? For instance, we just had a witness this morning who said that he was given a ticket, he flew to San Juan and back and he said he didn't have enough money to go and that was the reason the ticket was furnished to him, and he assumed that he used the same ticket he was furnished for his return. We have the ticket down but we don't have the ticket back. So far as we know, it was never used. But he thinks he used it. Is this very unusual with your company, that he did use the ticket and we can't find a record of it?

The WITNESS. The records we were required to investigate are extensive and the time element that we were given to investigate these records was rather short. Now we did the best job we could. We put 8 or 10 people on this for 2 days, worked them overtime to try to get as much of this investigation completed as we could. In the time limits we had, we submitted the records as we had them at that time.

Mr. DICKINSON. We meant no criticism of you or the record furnished. We really just want to know if this is likely or possible. Do we have a bunch of tickets out that people have just lost? I think there is some $4,000 unaccounted for, is that right?

Mr. O'CONNOR. Close to it.

Mr. DICKINSON. They have just disappeared.

Is there any way these could have been converted into money? The WITNESS. The tickets are often issued over one carrier in the box indicated on the ticket "via" a carrier; Eastern, for example. This could be used by Pan American, Trans-Caribbean, to be used by any other carrier.

Mr. DICKINSON. We suspect that was the case this morning with this particular witness. He felt this might be so.

The WITNESS. We attempted to look at the billings of these coupons honored by other carriers to us, billings to us. Some carriers give us easily referenced records; some do not.

In the investigation it is purely manual when we don't have a complete numbered ticket system furnished by the carrier. So the investigation is quite detailed and thorough. It is possible that further investigation might develop more additional records.

Mr. HAYS. Mr. Grayson, this question is in no way critical, but do you have any significant number of tickets which people buy and use a half and just either lose the other half or forget about it or don't turn it in? Do you have a significant windfall that way?

The WITNESS. Percentagewise it is a very small number.

Mr. HAYS. But it does happen?

The WITNESS. Oh, yes.

Mr. HAYS. This is just for the record. If you would buy a ticket and find that a year or 2 years later a half of it has been unused, you can always turn it in for credit against the account for which it was bought?

The WITNESS. Yes, sir. The tickets are normally valid for 1 year. Mr. HAYS. Suppose you have a ticket that wasn't used in the 1 year, you could turn in the half for a refund?

The WITNESS. We would make it; yes, sir.
Mr. HAYS. Or issue another ticket?

The WITNESS. Yes.

By Mr. O'CONNOR:

Q. The fact that in your examination of your records and the examination which the committee made of the records which you furnished, that there be unused portions of tickets unaccounted for, we could not make a definite statement that these are lost or misused or unused because actually you don't know whether they have been used or not, isn't that right?

A. Yes, sir.

Q. We would have to be cautious in any statement the committee makes concerning these unused portions?

A. Yes.

Q. I wonder how we could be more specific in connection with a statement like this? I am just asking for information because if we made a statement that x number of dollars worth of unused tickets are hanging around some place, and yet it was an error in the billings to you, or the like, we are not on too strong ground.

Mr. NEDZI. We could only repeat what Mr. Grayson has testified to, that there just hasn't been ample opportunity to examine these records in sufficient detail.

Mr. O'CONNOR. There is something of real concern in making a report on this. I know the committee wouldn't want to make a statement like

Mr. HAYS. Off the record.

(Discussion off the record.)

Mr. DICKINSON. One other question, Mr. Grayson: Do you have much trouble with other companies and businesses, such as you do with the Federal Government and its buying of tickets, as far as missing tickets and incomplete records are concerned? Is this unique with us?

The WITNESS. We seldom get inquiries of this type, sir.

Mr. DICKINSON. I suppose that means that you would have gotten similar inquiries if others had the trouble we apparently had?

The WITNESS. Yes.

Mr. DICKINSON. I think probably growing out of the investigation of this committee, we would like to come up with some sort of recommendation for our own regulation within the Government as to how we can best avoid any duplication of past experiences in the future. Do you have anything you would like to volunteer on this as to what method we had better go to?

The WITNESS. I believe it would be best from an understanding of the entire operating procedure of the air travel plan that it not be done in committees such as this. It takes a lot of detail and a lot of time.

Mr. DICKINSON. I have in mind particularly a person would be delegated to go down and buy 20 tickets in a block and arbitrarily assign various names to them. Put them all on one credit card. One signature for the entire lot, as far as we know. Then we never know actually who takes those trips and you don't either because you have no way of verifying who gets on the plane. This is a fact that we have found. Is this more or less what you say is true too?

The WITNESS. Yes.

Mr. DICKINSON. Within your system can you think of any reasonable checks and balances or regulations that could be imposed on the use of these tickets or the purchase of these tickets?

The WITNESS. There is no practical method of identifying the passenger and the ticket at the time of usage. From a sales standpoint, there is a form called a one-trip air travel order which, when a person who has a "Q" card, for example, wants to buy a ticket for someone other than himself, he can issue a one-trip air travel order which requires this individual to sign his name as having received that ticket. The ticket is issued to him and he signs for it for his transportation.

Mr. DICKINSON. It is a technical matter. Where would he sign this? Would he go to the ticket office himself and pick it up and sign for it right there?

The WITNESS. Yes. This could not prevent that person from giving the ticket to somebody else to use. The identification is still a problem.

Mr. HAYS. Mr. Grayson, you said you seldom had inquiries of this type. Obviously you wouldn't have had this inquiry unless somebody brought this to our attention. They have made quite a thing of it and I don't criticize the person who did this. Would it be possible for the president of a small corporation having a "Q" card to buy a ticket for his wife and himself and put some other name on his wife's ticket and maybe some other name on his own and use it and as long as the corporation didn't inquire about it, you would have no reason to inquire, would you?

The WITNESS. That is right.

Mr. HAYS. It could happen?
The WITNESS. Yes.

Mr. HAYS. And unless it was brought to the attention of the person against whom the offense was committed, and they inquired of you, there would be no inquiry?

Mr. DICKINSON. If I have a ticket and it is for Eastern Airlines, and for some reason I missed the plane or decided to go at a different time and I wanted to go on American Airlines, I could take your ticket to the American counter. What do they do? They change that ticket, or do they issue a new ticket?

The WITNESS. It depends on the circumstances. Normally they will try to honor the ticket without changing it. If it is a rerouting, they will probably have to reissue it.

Mr. DICKINSON. What will they do with the original ticket of Eastern's?

The WITNESS. That would be used to support the sale transaction of the new ticket and then they would bill us.

Mr. DICKINSON. Would they send that ticket to you?

The WITNESS. Yes, sir. Not as an ATP transaction, but an interline ticket transaction.

Mr. DICKINSON. Would this be true for Trans-Caribbean and all the major lines?

The WITNESS. Standard procedure.

Mr. DICKINSON. I am still trying to find somebody's missing tickets and I was wondering if this might be what happened to them?

The WITNESS. The problem of missing tickets is probably a great deal related to what you are referring to. The records we get from these other carriers when they bill us for these tickets, some of them are in numerical listings which are easily accessible. Some are just