WASHINGTON, Sept 5 (Reuters) - The U.S. Transportation

Department (DOT) said on Thursday it is opening an inquiry into

the four largest U.S. air carrier rewards and frequent flyer

programs to ensure consumers do not face unfair, deceptive, or

anticompetitive practices.

Transportation Secretary Pete Buttigieg sent letters to

American Airlines ( AAL ), Delta Air Lines ( DAL ), Southwest

Airlines ( LUV ) and United Airlines, ordering them to

provide records and submit reports answering detailed questions

on their rewards programs.

The department is reviewing how consumers are "impacted by

the devaluation of earned rewards, hidden or dynamic pricing,

extra fees, and reduced competition and choice."

Reuters first reported in December that DOT had begun

scrutinizing the frequent flyer programs of major U.S. airlines

for potential deceptive or unfair practices.

DOT and the Consumer Financial Protection Bureau held a

public hearing in May on airline loyalty programs, while some

lawmakers have also scrutinized the programs.

Buttigieg said the department is seeking "more specific data

to better understand the largest rewards programs and identify

potential competition or consumer protection issues or risks."

U.S. airline frequent flyer programs have tens of millions

of members and along with co-branded credit cards generate

billions in revenue annually.

Delta, which said in 2020 it had more than 100 million

frequent flyer members, added 8.5 million members in 2022.

Southwest Airlines ( LUV ) said its flexible rewards program

benefits has resulted in the carrier doubling the industry

average of seats booked with points, while the other carriers

declined or did not immediately comment.

Trade group Airlines for America said U.S. airlines are

transparent about frequent flyer programs "and policymakers

should ensure that consumers can continue to be offered these

important benefits."