A GOVERNMENT crackdown on a credit card con fleecing millions each month from plane passengers is set to fail because corporate cops have absolutely no idea what they can do about it.

Earlier this month Small Business Minister Bruce Billson - responsible for consumer affairs in the Coalition - asked the Australian Securities and Investments Commission to get involved after realising the public was fed up with excessive surcharges "particularly in the airline industry", he said.

The secret to avoiding flight surcharges

Reserve Bank of Australia rules that came into effect in March were meant to ban airlines, hotels, ticketing agencies and others from slugging customers who pay with Visa, Mastercard or American Express more than the "reasonable cost of acceptance".

This should have brought down the plastic payment charge for booking a flight from as much as $17 to as little as $2. Visa and co want fees to fall because the extra cash goes to merchants, not them. Super-sized fees are also a barrier to use of their products. So initially they welcomed ASIC's involvement.

However, News Corp Australia understands ASIC is now privately expressing concerns that it can't act against rorting merchants. When this was put to ASIC it was not denied.

"If we are going to see any real reduction in the level of surcharging, there needs to be public enforcement," Visa Australia boss Vipin Kalra.

News Corp can reveal Visa has tested 12 large merchants' surcharging levels and found several were about 33 per cent more than the "reasonable cost". Those charging too much are aware they are flouting the RBA rules but have not brought down their fees. The RBA has no power to enforce its rules. Nor have Visa and its rivals had success.

Mr Billson involved ASIC after a Government-commissioned report suggested amendments to the Australian Consumer Law to put the Australian Competition and Consumer Commission in a position to get tough.

Mr Billson rejected this advice, saying "existing ASIC and ACCC powers appear adequate".

However, Monash University Professor Steve Worthington said the RBA rules were currently "unpoliceable".

"You are going to need to get someone to act as the enforcer, otherwise (merchants) will know there is no policing involved," Professor Worthington said.

ASIC was given repeated chances to refute this story but did not. Instead a spokesman said it was "very actively considering the issues raised and liaising with the ACCC to ensure coordination of our efforts".

Research by East & Partners, which has done work for the RBA in this area, reveals not only that a greater proportion of larger merchants impose surcharges but that the average size of their surcharges is larger, at 2.3 per cent.