The US government told United Continental it would not face fines after a 69-year-old man was dragged from a flight in April, a US official said on Wednesday, a decision that was criticised by a passenger rights groups.

The US Transportation Department notified United of its decision in a letter made public on Wednesday by passenger advocacy group Flyers Rights.

A government official confirmed the authenticity of the letter, which said United did not comply with all aspects of the government’s rules on overselling seats.

In April, a video went viral on social media of David Dao being dragged from a United aircraft at Chicago’s O‘Hare International Airport after he refused to give up his seat to make room for a crew member.

United said in a statement on Wednesday “this incident should never have happened and we are implementing all of the improvements we announced in April, which put the customer at the centre of everything we do.”

The incident drew attention to the practice of “bumping” whereby airlines deny passengers access to flights after deliberately over-booking them to ensure all seats are filled.

United said it had an almost 90 per cent reduction of so-called involuntary denied boardings year-over-year since May 1.

Paul Hudson, president of Flyers Rights, said for “the Department of Transportation to conclude that United Airlines’ conduct did not warrant an enforcement action is a dereliction of duty.”

He said the US Transportation Department should have held a public hearing after finding United violated government rules.

The Transportation Department for months repeatedly refused to disclose the status of its investigation into Mr Dao’s dragging.

“No passenger should be treated like that,” US transportation secretary Elaine Chao told a Senate panel in July.

The department did not immediately comment on Wednesday.

Business news: In pictures Show all 13 1 /13 Business news: In pictures Business news: In pictures Flybe collapses Airline Flybe has collapsed. All future flights on the Exeter-based airline have been cancelled – leaving more than 2,300 staff facing an uncertain future, and wrecking the travel plans of hundreds of thousands of passengers. The chief executive, Mark Anderson, said: “Europe’s largest independent regional airline has been unable to overcome significant funding challenges to its business. AFP via Getty Business news: In pictures Future product placement will be 'tailored to individual viewers' Marketing executives say that product placement in films and televison shows on streaming services such as Netflix may be tailored to individuals in future. For instance, if data shows that a viewer is a fan of pepsi, a billboard in the background of a shot would host an advert for pepsi, while for a viewer known to have different tastes it could be for Coca-Cola Paramount Business news: In pictures Corbyn wishes Amazon a happy birthday In a card sent to Amazon CEO Jeff Bezos on the company's 25th birthday, Labour leader Jeremy Corbyn writes: "You owe the British people millions in taxes that pay for the public services that we all rely on. Please pay your fair share" Business news: In pictures No deal, no tariffs The government has announced that it would slash almost all tariffs in the event of a no-deal Brexit. Notable exceptions include cars and meat, which will see tariffs in place to protect British farmers Getty Business news: In pictures Fingerprint payment NatWest is trialling a new bank card that will allow people to touch their hand to the card when paying rather than typing in a PIN number. The card will work by recognising the user's fingerprint NatWest/PA Wire Business news: In pictures Mahabis bust High-end slipper retailer Mahabis has gone into administration. 2 Jan 2019 Mahabis Business news: In pictures Costa Cola Coca-Cola has paid £3.9bn for Costa Coffee. A cafe chain is a new venture for the global soft drinks giant PA Business news: In pictures RIP Payday Loans A funeral procession for payday loans was held in London on September 2. The future of pay day lenders is in doubt after Wonga, Britain's biggest, went into administration on August 30 PA Business news: In pictures Musk irks investors and directors Elon Musk has concluded that Tesla will remain public. Investors and company directors were angry at Musk for tweeting unexpectedly that he was considering taking Tesla private and share prices had taken a tumble in the following weeks Getty Business news: In pictures Jaguar warning Iconic British car maker Jaguar Land Rover warned on July 5, 2018 that a "bad" Brexit deal could jeopardise planned investment of more than $100 billion, upping corporate pressure as the government heads into crucial talks AFP/Getty Business news: In pictures Spotif-IPO Spotify traded publically for the first time on the New York Stock Exchange on Tuesday. However, the company isn't issuing shares, but rather, shares held by Spotify's private investors will be sold AFP/Getty Business news: In pictures French blue passports The deadline to award a contract to make blue British passports after Brexit has been extended by two weeks following a request by bidder De La Rue. The move comes after anger at the announcement British passports would be produced by Franco-Dutch firm Gemalto when De La Rue’s contract ends in July. The British firm said Gemalto was chosen only because it undercut the competition, but the UK company also admitted that it was not the cheapest choice in the tendering process. Business news: In pictures Beast from the east economic impact The Beast from the East wiped £4m off of Flybe’s revenues due to flight cancellations, airport closures and delays, according to the budget airline’s estimates. Flybe said it cancelled 994 flights in the three months to 31 March, compared to 372 in the same period last year.

The government letter said United provided correct compensation for four out of five passengers on the Chicago flight but did not provide required, written oversales notices to Mr Dao or his wife.

United chief executive Oscar Munoz apologised at a congressional hearing in May for the removal of Dao, with whom the airline reached a settlement for an undisclosed sum.

Airlines have said they routinely overbook flights because a small percentage of passengers do not show up.

House and Senate bills under consideration include new passenger protections and would ban the practice of bumping boarded airline passengers.