The miles & points game can be incredibly lucrative, and allows us to enjoy luxury travel at steep discounts. I’d assume that most OMAAT readers play by the rules, and use legitimate methods to acquire points — this can include signing up for lucrative credit cards and spending money on them, and it can also include buying points directly from programs when there are sales.
What many people don’t realize is just how prevalent frequent flyer program fraud is, and how it can cause airlines to change the approach they take to letting members redeem points. For example, I just wrote about how Japan Airlines stopped releasing last minute first class awards, and theorized that if this is permanent, it’s probably due to the actions of mileage brokers.
I wanted to expand on that topic a bit more in this post, because it’s a major concern for airlines.
In this post:
The basics of what mileage brokers do
I’ve written in the past about mileage brokers, who essentially make a living buying and selling miles. In most countries, buying or selling miles isn’t illegal, but rather it just violates the terms & conditions of loyalty programs.
Essentially mileage brokers use their expertise to help people get a deal on premium airfare:
- In some cases they might just sell you miles at a discount, which you can use however you’d like
- More often than not, they’re basically pretending to sell you a discounted first or business class ticket (claiming they have access to special fares), when in reality they’re buying miles inexpensively, and then selling you a ticket booked with those miles at a profit
What many people aren’t aware of is the size of this industry. This isn’t just a few people buying and selling miles, but rather this is a huge industry that easily generates tens of millions of dollars per year (if not more). It’s also not just in the United States. Quite to the contrary, the fraud situation is currently much worse in some other countries (based on what I’ve heard, it’s the worst in China and India at the moment).
The lengths mileage brokers go to make money
Another thing that many people don’t realize is the lengths mileage brokers go to stay in business.
When it comes to mileage brokers acquiring miles, they do so in a variety of ways:
- Sometimes they’ll just buy miles directly from programs when there are promotions
- They also often buy miles from consumers who are looking to sell their mileage balance; just go online and search “sell airline miles,” and you’ll see how many of these businesses are looking to buy miles
- More scandalous, they’ll sometimes pay people for access to their SSN/EIN, in order to be able to apply for credit cards on their behalf, so that they can acquire miles through sign-up bonuses, which they in turn sell
- Most scandalous of all, they’ll often buy compromised frequent flyer accounts, and redeem those rewards for last minute tickets
Of course once they acquire miles, they’re typically looking to use those miles for first and business class tickets that they can sell to people, since that’s where the most money is. When they can, they’ll just outright redeem miles for the tickets that people want.
That’s bad enough, though unfortunately that’s not where the methods of some mileage brokers end. These are largely pretty savvy people who will analyze trends with how airlines release award availability. Some airlines are pretty consistent with how they release awards, and that becomes an issue.
Some mileage brokers will quite literally book refundable tickets in first and business class on a flight to “hold” the space, only to then later cancel the tickets shortly before departure, knowing that award space will open up. Then they can sell those tickets to customers. Suffice it to say that the revenue impact on airlines here is huge. As they say, “this is why we can’t have nice things.”
The way that mileage brokers go about marketing these tickets varies greatly:
- In some cases mileage brokers advertise discounted premium cabin tickets online, have people contact them, and then they do their best to find award availability to be able to sell them tickets
- In some cases mileage brokers consistently work with the same groups, so they know exactly which flights customers will want to book
- In some cases there are forums and chat apps where people will advertise a “deal” on a particular flight, where in reality they’re just selling miles to be able to book that ticket
This fraud puts airlines in a tough spot
Airlines have rules against bartering miles & points, and they also have the right to shut down your account for any reason. However, they of course want to be as fair as possible. Some airlines will only let members redeem points for family members, which is a way to mitigate this kind of risk. However, for the programs that let you redeem rewards for anyone, it can be much tougher to tackle fraud.
It’s bad enough when people are essentially trying to sell premium airline tickets at a discount, but it’s much, much worse, when people are engaging in other practices that prevent seats from being sold, like booking refundable tickets on a flight, in order to ensure award seats become available.
So I think people often underestimate how intentional some decisions are by airlines. Let me give a couple of examples.
For example, sometimes you might notice that airlines suddenly stop showing award availability online for travel out of a particular market, on a particular airline, etc. Often that’s not a glitch, but rather is an intentional move that reflects where the program is seeing the most fraud. Award ticket fraud is much more common online than by phone, so by taking those awards offline, it minimizes this issue (though is obviously inconvenient for everyone).
Along similar lines, sometimes changes in award availability patterns are also measures to counteract fraud, rather than anything else. My hope is that the lack of Japan Airlines first class award availability is a temporary glitch, but if not, my guess is that it’s intentional for this very reason.
Japan Airlines probably doesn’t mind releasing some first class award seats last minute to some people with credit card points that wouldn’t otherwise pay for first class. Japan Airlines probably does mind releasing first class award seats to someone who booked several refundable first class tickets, canceled them last minute, and then rebooked them as an award for a customer, all to generate a profit.
Bottom line
I think many people underestimate the size of the underground mileage broker world, and just how much it keeps airlines on their toes. There are people out there who make a living by buying points and then redeeming them to book first and business class tickets for others at a discount.
While that violates program rules, what’s even worse is everything that happens beyond that. From stolen miles being used, to people opening up credit cards on other peoples’ behalf, to people booking refundable tickets to make sure there’s award space, these brokers use a lot of methods to make money.
Airlines do what they can to stop this, though ultimately there’s only so much that can be done, given that it can be hard to figure out whether points are being redeemed for a friend or a customer.
This is just something to always be aware of, as I think many people don’t realize that many policies, award availability trends, and even how award availability is displayed, are related to this.
What’s your take on this whole world of mileage brokers?
I think the compromise should be make it illegal BUT remove transfer fees and require last minute award availability. Don't fly empty and not let people redeem
This really bugs me since I used to LOVE last minute award tickets. I'd be a bit flexible but based on trends would find my way home. Airlines didn't mind because they were last minute tickets and last minute award tickets were not for the faint of heart. It seems that the airline response is to just let the seats go out empty...what a shame!
There are so many KOLs on youtube teaching people to purchase miles from brokers publicly for years and the airlines are doing nothing. I will assume this is allowed somehow, otherwise it is a punishment to those save their miles hardly by legitimate way.
Big claims with no evidence - I would like to seem some numbers to support the million dollar industry claim and some sources.
I have no problem whatsoever buying a J or F ticket from a broker if it suits my travel requirements. It's just a shame that I can't add my own FFP number to them !
Only once was it queried at check in and then because my surname had two digits transposed !
Very easy solution, blockchain, it provides ownership from inception through redemption. Problem solved.
Interesting read. This is presumably how a certain “CEO of a new global a380 airline” is travelling. Always in a premium cabin but often very strange routings. Far from direct/efficient connecting route
I think there is a fine line and people need to determine what is acceptable and what is not. Many of these brokers are travel agents of sorts. If they use points but give you a great cash deal then this may be okay. They exchange points for cash in the form of purchasing your ticket, as long as you get all of the confirmation codes so the ticket is really booked. However, if it...
I think there is a fine line and people need to determine what is acceptable and what is not. Many of these brokers are travel agents of sorts. If they use points but give you a great cash deal then this may be okay. They exchange points for cash in the form of purchasing your ticket, as long as you get all of the confirmation codes so the ticket is really booked. However, if it is as far as using people's identity or other tactics to "work the system" then of course this is not okay. However, this being said, you could discuss something similar with the blogs. Perhaps this would be a good discussion too. For example, I have not been invited to many of the Amex promotions or other promotions recently and I do think it is about the blogs promoting it. Blogs like this provide tips and advice for working the system legally or for what you should do with your points and miles however airlines are adjusting accordingly.
Broker? lol - Ben, you underestimated it.
I literally heard someone telling me he "just bought thirty-ish elite qualifying nights" from some hotel chain like a week ago. Zero consequence.
Sometimes people believe it's just broker, but the "broker" can actually be some hotel GMs, airline insider, even property owners since their base salary is too low and the potential penalty is nearly zero - that is why some Murican hotel chains can...
Broker? lol - Ben, you underestimated it.
I literally heard someone telling me he "just bought thirty-ish elite qualifying nights" from some hotel chain like a week ago. Zero consequence.
Sometimes people believe it's just broker, but the "broker" can actually be some hotel GMs, airline insider, even property owners since their base salary is too low and the potential penalty is nearly zero - that is why some Murican hotel chains can reach some tier 3 cities in China - grey area business is *the* reason they still make profit (while losing money on regular hotel stuff like room and dining) given the industry is generally underpaid and it has to deal with customers who dont care to have a 2-hour long conversation just to get a suite upgrade.
Or bloggers
You meant Aloft Zhengzhou Shangjie? That hotel only serve the purpose of nights.
Ben, would you mind revealing what kind of sources you are basing your assertions on? In particular, you are saying that this is a multi-million dollar industry. Do you have any evidence for this? It sounds plausible, but is this article based on anything more than speculation? Where does your insight ("I hear that... ") come from?
Gustavo, it's true. back in the day of the late 80s, to mid-90s, the business was already nearing $10 million dollars a year. no hearsay. facts. i befriended many of the brokers back then and ever rode around with one that had just bought a new Rolls Phantom. in those days there were many lawsuits as airlines were playing whack-a-mole. some of those lawsuits revealed the financials of some of the brokers, most did not...
Gustavo, it's true. back in the day of the late 80s, to mid-90s, the business was already nearing $10 million dollars a year. no hearsay. facts. i befriended many of the brokers back then and ever rode around with one that had just bought a new Rolls Phantom. in those days there were many lawsuits as airlines were playing whack-a-mole. some of those lawsuits revealed the financials of some of the brokers, most did not but one broker alone had over 100 various websites offering to buy/sell miles and first/biz class tickets. corporation and businesses around the world were some of their largest customers. one broker who was successfully sued to close their doors used the millions they had already earned to go on and fund several hotel booking websites, one of which was later sold for $1.1B. it is not speculation and i might even offer that the business has at times exceeded $50M a year globally. want a measure? here's one broker who has bought sold over 7 million awards: https://skift.com/2021/08/27/brazils-miles-based-flight-seller-maxmilhas-buys-a-hotel-discounter/
Airlines could force an account owner to register companions and award tickets can only be purchased for companions. Maybe allow one change per year. Account owner can register his direct family as well as brothers and sisters, parents and grand parents.
Have heard some stories on mileage brokers in China - the scale of mileage brokers were so huge that even travel agents join the game and sell award tickets online just like any other ticket.(They won't tell their clients how they get the ticket - of course) They would just redeem whatever their clients need regardless of travel class, which makes these brokers harder to be realised by normal passengers. Only when airlines cancel those...
Have heard some stories on mileage brokers in China - the scale of mileage brokers were so huge that even travel agents join the game and sell award tickets online just like any other ticket.(They won't tell their clients how they get the ticket - of course) They would just redeem whatever their clients need regardless of travel class, which makes these brokers harder to be realised by normal passengers. Only when airlines cancel those tickets and reject the ticket holders from boarding the flight would the ticket holders realised that they are scammed by the brokers. I remember seeing these incidents been aired on TV to warn viewers way before Covid exist.
It's true, they are buying tons of ads on Chinese Social media.
That is a simple and clear solution and I think BA has that registration system.. I also wonder why other airlines have not done it more . I imagine the ailrines also game their own system and sell last minute bargains through brokers to fill empty seats. . So I do not think there any victims here.
Are you sure this is happening? It would require tying up the full price of an F/J ticket for weeks or months in the hopes of selling it later at a discount. To run this at scale would require a large amount of operating cash, and I’m almost certain better, more legitimate investment opportunities exist, and this is probably not the easiest way to laundervdirty money.
El-Al used to restrict award tickets redemptions only when flying the account owner himself and any person accompanying him for at least one leg of the itinerary.
Just 10 days ago I was on a transatlantic LH flight in business class. The lady next to me said they, probably their family / friends , always buy cheap tickets from „a guy in New York“. And they always get their tickets only 2 or 3 days before departure. I told her the the guy was selling them award tickets, she had no clue what I was talking about. I’d be curious to know...
Just 10 days ago I was on a transatlantic LH flight in business class. The lady next to me said they, probably their family / friends , always buy cheap tickets from „a guy in New York“. And they always get their tickets only 2 or 3 days before departure. I told her the the guy was selling them award tickets, she had no clue what I was talking about. I’d be curious to know to what extent broker transactions have really dried up transatlantic award space. It’s as dry as I have never seen in 20 years.
You should run another article titled ‘How Tier Point Runners Ruin the Climate for Everyone’.
An easier solution for airlines would be enforcing some cancellation fees when the cancelling is happening close to the departure date. Or simply blacklist the award redemption for passenger who has just cancelled the same flight.
@ KAI -- Keep in mind that a lot of "legitimate" business travelers pay big bucks for tickets precisely for the flexibility of being able to cancel last minute, in the event that their plans change. Also keep in mind that a refundable ticket that's booked probably isn't held in the name of the person who will fly the award. Rather, some other name is typically used.
Look at QR for a highly restrictive policy on purchasing J... at least on their app it seems there is no such thing as a fully refundable ticket, even for the highest cost ticket. You get a voucher with a 10% bonus, not cash. Nobody can play games there!
"based on what I’ve heard, it’s the worst in China and India at the moment"
Even if it is true, how does it affect the award availability between North America and Europe?
Look at this website: https://www.buymiles.com/ based in Madison, NJ 07940
13,000,000,000
Miles Traded
75K
Customers
120K
Transactions
@ Colin -- Well it's also a big issue in the United States. Furthermore, keep in mind that a lot of traffic from India and China routes through Europe to get to the United States.
So does that mean it’s affecting the likes of Emirates more than actual Indian or Chinese airlines?Last I checked, Indian carriers have the most convoluted redemptions and processes in general. On a lighter note,If these brokers are able to game them,then more power to them for the sheer patience and doggedness.
Do you still make money off points pros?
Credit cards have ruined the game, not brokers.
And bloggers like Ben
@ Brent the second -- I'm curious, what do you consider to be "the game," then? With so many frequent flyer programs being revenue based, surely it's not mileage running?
Airlines that massively devalue without notice are no better morally than the ticket brokers. In fact they are worse.
Very true!
Another observation from Expert flyer inventory. JL is overselling J, with empty F. Maybe they figured rather than give away F seats at 2 weeks out, hold back and oversell J. Then bump up their top tier.
@ Randy -- Sometimes business class being oversold leads to first class availability being held back. However, in some cases these are flights that are "J9C9D9," and have wide open seatmates, so I don't think that's consistently to blame here.
I am tracking new term JL flights - that would normally only have 1 or 2 F seats left after the 2 week snap up.
In these cases - flight is showing like F3, J3. Looking at seat maps - all J seats are occupied and F has many empties which would normally be gone.
Holding back - JL can sell J seats and put top tier in those F at check in.
...I am tracking new term JL flights - that would normally only have 1 or 2 F seats left after the 2 week snap up.
In these cases - flight is showing like F3, J3. Looking at seat maps - all J seats are occupied and F has many empties which would normally be gone.
Holding back - JL can sell J seats and put top tier in those F at check in.
I am seeing only next day flights with F consumed - but up to next day - F is wide open now. So not clear when JL is releasing those F seats one day out??
Different view here. Airlines have a global customer base. 96% of that customer base has to earn miles through 'ass in seat' with an occasional mile earned here and there on spending via a very limited number of credit cards.
US credit card companies have deals with a couple of airlines to give millions of miles away via signup bonuses and offer lucrative miles multiples earned on spending. These credit cards are available to...
Different view here. Airlines have a global customer base. 96% of that customer base has to earn miles through 'ass in seat' with an occasional mile earned here and there on spending via a very limited number of credit cards.
US credit card companies have deals with a couple of airlines to give millions of miles away via signup bonuses and offer lucrative miles multiples earned on spending. These credit cards are available to less than 4% of global population.
Unfortunately, due to the 3 global alliances, the US miles inflation triggered by US CC issuers spreads to non-US airlines.
What these miles brokers do is simply arbitrage which enables people who buy those miles to buy once in while a discounted BC or FC seat.
As these seats were anyway allocated as reward seats I can't really see what the issue is here. Airlines have provided those miles and thus must have been budgeting award availability accordingly. And thus do brokers not place airlines at any disadvantage.
@ Ron -- You're absolutely right that those of is in the United States have it good when it comes to miles & points. But that's also because the programs are the most lucrative for airlines here, and it's where there's the most money to be made.
You're right that some award availability is allocated no matter what, but the issue with mileage brokers is that they're often breaking rules beyond just selling miles. As...
@ Ron -- You're absolutely right that those of is in the United States have it good when it comes to miles & points. But that's also because the programs are the most lucrative for airlines here, and it's where there's the most money to be made.
You're right that some award availability is allocated no matter what, but the issue with mileage brokers is that they're often breaking rules beyond just selling miles. As I explained, they'll sometimes book refundable tickets in order to make sure award seats are released later, which could be very costly to airlines.
Don't you agree that this is problematic for airlines?
@Ben
No I don't think so. Airlines are selling perishable capacity; once the plane takes off any empty seat can't be sold later.
So airlines surely run models to figure out the best mix of ticket types and prices to get the planes loaded up. For that they will be running huge analytics software and decide how the 'ticket menu' will look like.
Those brokers simply make use of what is offered on...
@Ben
No I don't think so. Airlines are selling perishable capacity; once the plane takes off any empty seat can't be sold later.
So airlines surely run models to figure out the best mix of ticket types and prices to get the planes loaded up. For that they will be running huge analytics software and decide how the 'ticket menu' will look like.
Those brokers simply make use of what is offered on that menu. If airlines feel this is an issue they surely can find ways to address or prevent it.
I have worked in an industry where we were selling perishable capacity. There is always that battle between what you want customers to do and what they actually do. The moment you feel customers are getting the upper hand you need to make changes to your offering structure.
All airlines have fraud teams to some extent and are free to cancel/suspend suspect accounts arbitrarily (under terms of their T&Cs).
Whether or not they do depends on how seriously they consider the fraud detected.
It is important to them to retain their members (customers) goodwill by managing their FF program to mutual benefit (primarily their own).
The miles brokers upset this balance and IMO should be crushed like a bug.
OK - I had been tracking JL F inventory for a few months and the pattern when F seats were released 2 weeks out. Big focus on JL as it is the sweet spot in OW reward booking.
I really don't think the fraudsters are the big reason for JL stopping to release F seats at 2 weeks out.
I have observe that as soon as JL released F - which could be as...
OK - I had been tracking JL F inventory for a few months and the pattern when F seats were released 2 weeks out. Big focus on JL as it is the sweet spot in OW reward booking.
I really don't think the fraudsters are the big reason for JL stopping to release F seats at 2 weeks out.
I have observe that as soon as JL released F - which could be as many as 10 seats out of JFK - that within a couple of minutes all seats are taken. So unless you know the release time - and act within seconds, you have no chance.
I suspect JL changed this to give their FF and others a chance for these seats. Maybe they are no upgrading their top tier?
JL reads the blogs and has observed this pattern as well. JL hosted us at a MegaDo in SEA once - so they know all about this community.
I have heard rumors that Mileage Brokers run bots to book the awards, I think what you described just reinforces that possibility.
@ Randy -- Figuring out when they release space isn't hard. It's even written explicitly in one FlyerTalk thread. I suspect that's *exactly* what mileage brokers are largely doing, snagging those seats within seconds of them becoming available.
Instead of pushing Aeroplan cards and Aeroplan itself, its time for a post how Aeroplan lost Oman, Etihad and Thai as partners.
But gaining SQ back is a huge win though
Yea... can you still book Etihad over the phone? I saw it wasn't coming up on the site.
Trying to call them is a nightmare of either holding the phone for hours or being disconnected as they are busy. They will only give you the same information that you see on their website. Sorely regret buying Aeroplan miles
I reached out to Lucky and a few other travel bloggers a couple months ago asking about the lack of Oman Air availability via Aeroplan and never got a reply. The exception was LoyaltyLobby who posted that this was temporary according to Aeroplan, which I believe is untrue.
Ever since then, the list has started to increase and now includes Thai, Etihad, and others...Aeroplan made their profit by utilizing these blogs to fool us to buy miles with bonuses etc and now does not care if we have to struggle to search for flights. The bloggers will not respond at all as they are part of this mess
Honestly this is really disheartening especially for the ones of us who don't necessarily have ways to generate huge amounts of miles in short periods of time, and save for a while. I really hope that the lack of award availability this year is temporary and not due to those brokers. Out of curiosity, which airlines or programs have changed their rules specifically because of that issue ?
Hopefully airlines those who are mileage brokers or dishonestly use mileage brokers from flying with them permanently. Then they can move to those loud and incessant YouTube and TikTok people.
Ben, while I agree completely with your assessment here. I do think that Reward Booking companies - like yours and points.me - also make it unfair to normal people who are trying to book rewards. While not the same as the fraudsters, your team knows when JAL and others release rewards and, I assume, use airline release patterns to book tickets for your clients.
The difference here is that we were all points newbies at one point and became educated over time. So all current newbies who cares can also learn to play. Everyone has the same threshold of learning the craft. Whereas the other path would require us all to join the fraudster path which is really not the way to go.
@ Randy -- I respect your take, but that's honestly not how I see it. Someone using their knowledge and expertise to help people book award travel is no different than how some people have tax advisors, lawyers, etc.
It's one thing if an award business were proactively holding award space when it opened, and then "selling" it to the highest bidder, or something. But that's not what's happening.
I suppose one could make the...
@ Randy -- I respect your take, but that's honestly not how I see it. Someone using their knowledge and expertise to help people book award travel is no different than how some people have tax advisors, lawyers, etc.
It's one thing if an award business were proactively holding award space when it opened, and then "selling" it to the highest bidder, or something. But that's not what's happening.
I suppose one could make the same argument about bloggers, that they ruin everything by sharing tips for how to efficiently redeeming miles.
To me there's a difference between seeking out expertise to help with something, and committing fraud.
I think Chinese Scalpers is the reason why JAL took all F away.
https://mp-weixin-qq-com.translate.goog/s?__biz=Mzg3MzY2MDM0OA%3D%3D&mid=2247518435&idx=1&sn=53df3e0e0fe7e91eb7eaca43b3222c42&chksm=cede6230f9a9eb263fdfb6fcd92d6c5a0d5bbf2a9e3f6f4f198dd06b34746f344c3294ee2952&scene=1&subscene=10000&sessionid=1686876139&clicktime=1686876176&enterid=1686876176&ascene=3&fasttmpl_type=0&fasttmpl_fullversion=6725708-en_US-zip&fasttmpl_flag=0&realreporttime=1686876176700&_x_tr_sl=auto&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=wapp#wechat_redirect
https://mp-weixin-qq-com.translate.goog/s?__biz=Mzg3MzY2MDM0OA%3D%3D&mid=2247516808&idx=1&sn=28366962b641bebe1aa46dce97a0f3a7&chksm=cede685bf9a9e14d89bf2f8c6880e8c9960455437f113e61b6af81506b5d1743e9e937c4a781&scene=1&subscene=10000&sessionid=1686876139&clicktime=1686876311&enterid=1686876311&ascene=3&fasttmpl_type=0&fasttmpl_fullversion=6725708-en_US-zip&fasttmpl_flag=0&realreporttime=1686876311721&_x_tr_sl=auto&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=wapp#wechat_redirect
I think Chinese Scalpers is the reason why JAL took all F away.
https://mp-weixin-qq-com.translate.goog/s?__biz=Mzg3MzY2MDM0OA%3D%3D&mid=2247518435&idx=1&sn=53df3e0e0fe7e91eb7eaca43b3222c42&chksm=cede6230f9a9eb263fdfb6fcd92d6c5a0d5bbf2a9e3f6f4f198dd06b34746f344c3294ee2952&scene=1&subscene=10000&sessionid=1686876139&clicktime=1686876176&enterid=1686876176&ascene=3&fasttmpl_type=0&fasttmpl_fullversion=6725708-en_US-zip&fasttmpl_flag=0&realreporttime=1686876176700&_x_tr_sl=auto&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=wapp#wechat_redirect
https://mp-weixin-qq-com.translate.goog/s?__biz=Mzg3MzY2MDM0OA%3D%3D&mid=2247516808&idx=1&sn=28366962b641bebe1aa46dce97a0f3a7&chksm=cede685bf9a9e14d89bf2f8c6880e8c9960455437f113e61b6af81506b5d1743e9e937c4a781&scene=1&subscene=10000&sessionid=1686876139&clicktime=1686876311&enterid=1686876311&ascene=3&fasttmpl_type=0&fasttmpl_fullversion=6725708-en_US-zip&fasttmpl_flag=0&realreporttime=1686876311721&_x_tr_sl=auto&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=wapp#wechat_redirect
Ben - Can you also write an article how travel bloggers have also ruined redemptions for the average traveler?
Shawn...I want to congratulate you... Unfortunately, Ben will never respond to this and will smartly ignore anything related to his blogs which have literally damaged award flights
Yep. Ben will eventually have to pay EK first for his champagne fix
Right? Like when there was that AA donation “promotion” a year or two back and Ben used it to buy literally millions of miles? Kind of hard to see how airlines CAN’T devalue their programs when single individuals are buying millions of miles for $10-20k. Sure the money went to a “good cause” but still. Millions of cheap miles flooded the market.
Best comment here! Ben is so mad at the mess he helped create.
@ Shawn -- Bloggers have ruined this by... showing other people how they can efficiently redeem their miles? Or...? By that logic, I suppose anyone who shares any tips with anyone "ruins" something for people.
This is of course a little bit like entertainment ticket resale. It’s a problem of supply and demand. If nobody purchased tickets from the mileage brokers, they wouldn’t exist. If nobody would pay $3,000 for a resale Taylor Swift ticket nobody would buy them to resell. It’s an unfortunate dichotomy of unregulated market capitalism. If a government regulates such activities it at least reduces the problem. You have to watch out for downsides of regulation...
This is of course a little bit like entertainment ticket resale. It’s a problem of supply and demand. If nobody purchased tickets from the mileage brokers, they wouldn’t exist. If nobody would pay $3,000 for a resale Taylor Swift ticket nobody would buy them to resell. It’s an unfortunate dichotomy of unregulated market capitalism. If a government regulates such activities it at least reduces the problem. You have to watch out for downsides of regulation though. In Europe there’s now limited options to buy resale entertainment tickets period. At least in the US anybody can go to any event if they have the money. Get rid of mileage brokers and less J and F tickets might “sell” and airlines could end up downsizing cabins. Then we all lose.
Waiting for @Tim Dunn to tell us Delta have lead the way in solving this problem.
When SkyMiles charges 800k for a single transatlantic ticket, no broker could be profitable.
Years ago, when living in DFW, I was flying 1st class all over the US. Sold miles like crazy, .... until AA found out. They threatened to take all my miles and close me out if I ever did that again. I sold well over a million AA miles, but never again after getting that letter. They also did not give me credit as lifetime miles for those I sold. Looking back that was just dumb on my part.
You're just one petty seller, nothing compared to the organized mileage broker syndicate.
You're just trying profit from your foolish decisions. They're running a business.
This is a great post Ben, really interesting and insightful. Would enjoy reading more of these and less of the "lady goes crazy during boarding because someone looked at her funny guess which airline ;/" posts we see on other blogs.
It's also so not fair of some airlines to just shut down account's for no reason. I just had this month with Lifemiles where I was helping my friend with a trip, I opened him an account on his name and transferred his points and used his credit card, and they canceled the booking and lock his account. I emailed them and they never got back to me on till I told them that I...
It's also so not fair of some airlines to just shut down account's for no reason. I just had this month with Lifemiles where I was helping my friend with a trip, I opened him an account on his name and transferred his points and used his credit card, and they canceled the booking and lock his account. I emailed them and they never got back to me on till I told them that I would file a claim with the FAA and they replied within a few hours that the account was back open.
These brokers must have massive capital reserves if, as you say, they are buying plane loads of refundable first class tickets and holding on to each of them for many months.
Cancellation of Mike’s tickets is simple you just get the miles back. So they have no extra cash out.
Cancelling tickets is not free on all airlines, especially with miles, as you suggest.
they are canceling paid tickets, and then booking miles tickets. no cancelation of miles tickets.
@ Tim -- They're typically not holding onto tickets for month. For example, think of them maybe buying a few Lufthansa first class seats 20 days before departure, and then canceling them a few days before departure, and then suddenly award seats open up. The purchase and refund typically all happens within the same credit card cycle.
China Southern kills out brokers with their delayed nominee+heavy refund penalties.
You need to wait 30 days(15 for the first time adding) after nomination to make this person valid for redemption, platnums though get 3 instant valid annually though. Refund penalties are at 50 percent, unlike little to none with American or Alaska. This might be a solution though.
It's not a solution if it's so heavy-handed that it drives your best customers to other airlines because they don't like the award ticket inflexibility.
My experience dealing with mileage brokers while working at an airline is that they have a billion shell OTA-like websites that advertise business class tickets. They tend to use miles from one airline to book flights on a second airline to stay below the radar.
They ruined a lot of liberties we enjoy as points and miles enthusiasts by booking a cheap multi-leg journey (for O&D priced programs) and finding an agent that will drop...
My experience dealing with mileage brokers while working at an airline is that they have a billion shell OTA-like websites that advertise business class tickets. They tend to use miles from one airline to book flights on a second airline to stay below the radar.
They ruined a lot of liberties we enjoy as points and miles enthusiasts by booking a cheap multi-leg journey (for O&D priced programs) and finding an agent that will drop the segments you don’t want. This works on the cash side too where they’d book cheap South America to India flights for somebody looking to go from USA to India and getting the first leg dropped while keeping the rest intact at the same, cheap price.
How can you drop a segment though? I know Aeroplan consider a flight length the length between the flight origin and its destination. Hence, LHR-BAH-SIN will cost 110K while LHR-BAH-BKK(The same flight with a technical stop in SIN) only cost 80K due to BAH-BKK's shorter distance.
Used to be a lot easier via HUCA, but now there are some that will use schedule changes to do it if far enough in advance and there is a high likelihood of change. Most of these brokers are not in the US and can leverage some lowly paid city ticket office employees to help when in a pinch.
Interesting, i'm sure a huge amount of this is happening in Brazil. Some time ago the mileage broker market was so huge there that hey nearly bled LATAM to death . I saw some super weirdly cheap tickets from Venezuela to Argentina sold on shady 'Instagram travel agencies', for a fraction of what Copa charged for that route.
A friend of mine bough (and was able to fly luckily) one of these, I asked...
Interesting, i'm sure a huge amount of this is happening in Brazil. Some time ago the mileage broker market was so huge there that hey nearly bled LATAM to death . I saw some super weirdly cheap tickets from Venezuela to Argentina sold on shady 'Instagram travel agencies', for a fraction of what Copa charged for that route.
A friend of mine bough (and was able to fly luckily) one of these, I asked for the ticket and I never saw so many connections for that route in my life.
Ben, one of the best posts you've written in a long time. Especially for us that are seasoned OMAAT readers
@ LeonR -- That's sweet, thanks!
Yes, some travel agents hold seats in GDS in order to speculatively resell them. It may be unethical and may be a problem for the industry. But only a tiny fraction of these cases has ANYTHING to do with reselling award tickets. You've connected two unrelated issues, and it is unprofessional of you.
And you know what else is unprofessional? Your claim that brokers resell award tickets to unsuspecting clients, claiming they have access to...
Yes, some travel agents hold seats in GDS in order to speculatively resell them. It may be unethical and may be a problem for the industry. But only a tiny fraction of these cases has ANYTHING to do with reselling award tickets. You've connected two unrelated issues, and it is unprofessional of you.
And you know what else is unprofessional? Your claim that brokers resell award tickets to unsuspecting clients, claiming they have access to special fares. They wouldn't last in this business, as their clients would realize right away that they are not earning miles for such flights! Rather, typically clients buy award flights knowingly, with full disclosure and aware of risk involved. Shame on you for writing such a biased and simply misleading article.
Sounds like the award broker is upset
Lmaoo shut up you piece of human garbage. Go sell your illegal miles like a loser
I am always surprised how *little* friends and family, even those doing a couple of trips a year (including long and mid haul), know about the practicalities of the air travel and hotel businesses.
Don't assume all, or even most, of those clients know!
@ EugeneV -- Are you really prepared to support that claim? For example, if I Google "cheap business class flight broker" and click on one of the sponsored links that advertises business class for 70-80% off, nowhere on the websites does it mention that they're breaking the rules, and/or that people won't earn miles.
You're suggesting they would proactively volunteer this information? At one point during the transaction does that typically happen?
I don't know at what point it happens. I also don't know what sponsored links in Google search results would show, or how it would be indicative of anything actually taking place. But yes, I am prepared to support my claim, and I can go and ask some of the most established mileage brokers about their practices. Then again, so could you.
@EugeneV - wondering how many trips you've booked through brokers. I have never earned miles on a broker ticket. As an aside, the fellow I've dealt with is very professional and hardworking, and is very transparent about the fact that he is trying to find award space and resell it to us.
Greg, that's my point exactly. I am not the greatest expert on this industry, but neither does Ben appear to be one, unless he is intentionally distorting the truth. And the truth is, brokers' clients are even more loyal to them than your average travel agent's repeat customers. Do you imagine such people returning to their preferred brokers over and over, had the brokers not disclosed to them up front that they book award tickets?
Maybe I'm missing something, but how does booking refundable tickets "make sure" there will be award space close to departure. I would think the opposite would be true--the less seats actually sold would increase the chances of some being released as awards.
Mileage brokers would buy refundable tickets to "reserve" a seat, then cancel them a few days before departure, of which then the airline will release those seats for awards. Mileage broker will then redeem an award for their client.
Aeroplan only charges less than 20K more for full refundable, they could occupy these spaces as soon as they release (You can easily sell tickets like SQ SIN-LHR/SIN-SYD in Business any time of the year) and when there's customer need, they will cancel the ticket which positive space are available again and book in their client's name.
They should only allow family member booking. Seems straight forward. Why don't they all do that?
@ Family guy -- Keep in mind that's also complicated. How do you prove you're a family member? What if you have a different last name? What about a boyfriend or girlfriend?
Yes, limiting award user to family member does not solve the broker problem.
JAL mileage bank (sorry to stick Japanese FFP) theoretically limits its user to family member, but they require no proof when a JMB member adds family user. I added my wife’s parents with different family name and have no issue to allow her to issue award ticket.
This is especially tricky in Asia, family names themselves are huge, yet married couples often don't share the same last name. Hence in a situation with an account owner and parents from both sides, you are often looking at 4 different yet large last name families, as an Asian, it's very hard to not have a few friends starting with last names such as Li, Zhang, Nguyen, Kim, Wang etc.
ANA program only allows family bookings but ANA is also redeemable on other airline currencies like Virgin/star alliance, etc. which doesn't have that family requirement.
Define "family". That's why not.
And that's why no Euro or North American carrier engages in this discriminatory practice. Cathay's "Nominee" scheme might come close to satisfying you, without the quagmire.
"Nominee" makes sense. Then the airline can limit how many nominees you have. The problem is that a broker can just open a bunch of FF accounts and select different nominees for each. So then the airline would have to ask you to prove your identity by sending in a copy of your ID before your first redemption - which might reduce fraud (while annoying honest customers) but not eliminate it, as it's easy to...
"Nominee" makes sense. Then the airline can limit how many nominees you have. The problem is that a broker can just open a bunch of FF accounts and select different nominees for each. So then the airline would have to ask you to prove your identity by sending in a copy of your ID before your first redemption - which might reduce fraud (while annoying honest customers) but not eliminate it, as it's easy to cook up fake IDs.
Ben is right that there really is no easy way to solve this.
I have been recently traveling with a friend, I booked their ticket NY - Mexico with AA miles and my friend booked the return flight, Mexico - NY with their JetBlue points. I have plenty of AA miles but jno JetBlue points while my friend has no AA miles.
JAL Mileage Bank limits who can use awards - taken from their website.
Awards can be used by the JMB member, the JMB member's spouse(including domestic partner), the JMB member's relatives within the second degree of kinship, and the spouses of the JMB member's brothers/sisters-in-law.
Thus, it is odd to restrict JMB award space to their own members to counter mileage brokers.
Demand to visit Japan is quite high for various reason (removal of...
JAL Mileage Bank limits who can use awards - taken from their website.
Awards can be used by the JMB member, the JMB member's spouse(including domestic partner), the JMB member's relatives within the second degree of kinship, and the spouses of the JMB member's brothers/sisters-in-law.
Thus, it is odd to restrict JMB award space to their own members to counter mileage brokers.
Demand to visit Japan is quite high for various reason (removal of vaccine requirement, weak JPY, etc) so that might explain limited premium award space. In this summer, even for economy class, JAL charges the price which was enough for business class in pre-pandemic era.
@ A Japanese -- Correct me if I'm wrong, but I believe historically JAL has made the same award space available to its own members as it has to members of partner programs. It's possible that JAL just doesn't have the technology in place right now to better segment that.
Of course it's possible that this JAL situation is just a glitch (that's what I'm hopeful of), but there are definitely some other examples where...
@ A Japanese -- Correct me if I'm wrong, but I believe historically JAL has made the same award space available to its own members as it has to members of partner programs. It's possible that JAL just doesn't have the technology in place right now to better segment that.
Of course it's possible that this JAL situation is just a glitch (that's what I'm hopeful of), but there are definitely some other examples where this fraud impacted how programs acted (and that I know for a fact).
I believe that is the case that they used to provide the same award space to partners as their own members. IIRC Alaska is the only one that would often see 1 seat less than what was visible on JMB, or say, AA. Seems like I lucked out getting myself, my brother, and my mom all on the same flight in J with miles for our Japan trip last fall.
Could this be the reason, or one of reasons, for the very on/off business award availability across entire Ethiopian network in the last couple of years?
@ Tom -- It's my understanding that Ethiopian Airlines award issues were due to an actual problem with partners booking the space, where it showed as confirming, but then later "unticketed." Space was sometimes taken offline by partners because of the number of issues with those tickets. I don't believe that's specifically related to this fraud.
Fascinating reading — thanks, Ben!
Can you do a post on which airlines release last minute premium space on a regular basis like JAL used to do? I'm specifically thinking of the gulf airlines, but the question is broader.
@ Nate nate -- Yep, let me work on that!
I think what Singapore Airlines does makes sense - allow redemptions only for family. Maybe combatting fraud of this sort is also one reason why they generally don't release premium cabin award seats to partners. They have no control over their partners' policies and don't want to be faced with a situation where their pricing for revenue tickets is undercut by these brokers. By keeping all such redemptions in-house and preventing this sort of fraud,...
I think what Singapore Airlines does makes sense - allow redemptions only for family. Maybe combatting fraud of this sort is also one reason why they generally don't release premium cabin award seats to partners. They have no control over their partners' policies and don't want to be faced with a situation where their pricing for revenue tickets is undercut by these brokers. By keeping all such redemptions in-house and preventing this sort of fraud, they can make a reasonable amount of award space available to their own loyal customers and still benefit from banks paying them to accept credit card points transfers while they're at it.
It would be nice if the industry could come up with a consistent way to combat this sort of fraud. It might make partners more willing release award ticket space to each other, if they could trust each other to adequately police the market.
Just saying now SQ releases tons of awards to Aeroplan already and Aeroplan allow redemption for anyone on top of having a huge mile sell seasonly.
My chosen "family" are not related to me by blood or "marriage". Limiting redemptions to "family" would be a quagmire.
I don't think it's fair to just blame brokers (one could substitute the word broker for blogger and it would have the same impact). The fact of the matter is, it makes no sense to release every last one of your first class seats to award at a very predictable time. They almost certainly cost themselves significant revenue from regular paying customers. Within 14 days it was almost impossible to find F even at full...
I don't think it's fair to just blame brokers (one could substitute the word broker for blogger and it would have the same impact). The fact of the matter is, it makes no sense to release every last one of your first class seats to award at a very predictable time. They almost certainly cost themselves significant revenue from regular paying customers. Within 14 days it was almost impossible to find F even at full price for the last few months and that's usually when those type of customers buy those tickets.
The other factor at play here is the cost to their partners for these redemptions. We saw Alaska devalue due to the high cost and it became difficult at times to redeem with AA miles (lots of errors and phantom availability). The program only works when the most expensive redemptions are only available occasionally.
@ Omar -- All totally fair points, I agree that consistently and predictably releasing award space probably isn't a great business practice. I do think there's a difference though between people who try to show people how to use miles & points within the rules of the programs, and those who make a living violating the rules of the programs. Admittedly the widespread popularity of social media and TikTok has brought a lot more people into miles & points.
Yeah the reopening of Japan this year is doing odd things for premium cabin demand