American Express Lobby Capture
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To put it lightly, people are obsessed with points. Thanks to arbitrage opportunities where the purchase of points can save money on the same flights versus paying cash, there’s good reason for that too. Unfortunately, that also brings problems, notably in the form of illegal points sales which go against loyalty program rules, and all sorts of grey and black market shadow accounts to facilitate these bold moves. In an interesting turn of events, Amex is taking major steps to counter this action, which has resounding consequences…

Lufthansa First Class Wine And ChampagneThe Black Market Of Points

There’s an opaque world within travel where mileage brokers break loyalty program rules by finding ways around them. Basically, they earn lots of miles via a variety of dubious ways, and then they sell those miles, or tickets using said miles onto others who pay a premium for the privilege. In theory, the person paying is still saving what the ticket may have cost them using cash.

We’ve never advocated for anyone to use services outside loyalty program boundaries for the simple reason that there’s always inherent risk involved, including having an account shut down without notice. No one wants to lose all their points, or miss out on a trip. Right?

The Problems This Brings

Above all else, the rules are the rules. You can’t sell your miles to other people, nor can you sell them “airline tickets” which you then book with miles to pocket the savings. All other ethics aside, it’s just simply not allowed in airline loyalty program terms and conditions, and that’s – that.

The problem here is that people get caught out, showing up at the airport only to be quizzed by airline employees who suspect that rules have been broken, and find themselves completely out of luck from time to time. In addition, these mileage brokers flood the market, which can then mean less availability for actual normal customers who want to find dates using their points.

American Express Lobby CaptureWhat Amex Is Doing

Banks have progressively cracked down on turning their transferrable points into grey/black market businesses. At one point, you could convert Amex Points into airline miles regardless of the name on the loyalty program account. Then, it became only people named on the account, but an easy work around was simply to add someone as an authorized user and just never send them an actual card.

Now, American Express, per One Mile At A Time, will not allow points transfers to any authorized users who have not been on an account for at least 90 days. In other words, if you try to usurp the rules by constantly adding and deleting authorized users, so that you can sell points to them and transfer said points to them, that’s no longer going to fly. An authorized user account must be active for 90 days before any points can be transferred from Amex to another program.

Friendly Fire And Helpful Tips

It’s worth noting that there are plenty of innocent points enthusiasts who may temporarily get caught up in the fracas here, who are simply trying to move points between partners or family. If you do have plans to transfer points to a person of legitimate interest to you, be sure to add them as an authorized user ASAP, so that the 90 day waiting period will pass.

As always, these people are technically able to make charges on your account if you give them a card, so never make anyone an authorized user who you wouldn’t trust to be responsible. That, and just maybe don’t actually hand them a card.

Gilbert Ott

Gilbert Ott is an ever curious traveler and one of the world's leading travel experts. His adventures take him all over the globe, often spanning over 200,000 miles a year and his travel exploits are regularly...

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  1. Personally I think it’s a great idea. The incessant drive by hackers and non hackers drives the cost higher and value lower for us that do not partake. As a long time flyer I much preferred it when there was not a “loyalty” program other than the airlines took great care of you when you actually paid and flew those miles. Lounges were invitation only, first class fare were lower no discounting.

    If you took all the points programs away one would find fares lower. I know many will come back and say they caused it and your correct it’s gotten out of hand thats one reason the bar is being raised for redemptions. So spare me that argument.

    As an old famous E.F. Hutton ad once said ” you have to earn loyalty the old fashion way”

  2. I think I agree that this AMEX CC system sure has gotten out of hand after I was wrongly overcharged from Healthworks For Women in Coolidge CNR rather than directly thru my Bank account.
    I think our smart adults could use some more education on the problems of CC spending to prevent anyone from making the same above type of mistakes that I made last Spring just to get our minds off what’s bothering us (i.e My BHCC’s print-only Mooodle program for my ACC 201 01 class minus any digital technology).

  3. Except the only people in this equation that have a problem with what’s happening is AmEx.

    Most major airline rewards programs let you buy/sell/trade reward points/miles within their rewards program with other members. So this doesn’t really change anything. Just have the card holder transfer points to their own airline rewards account, and then “gift” them to the person your selling them to. No 90-day waiting period for a new “authorized card holder”.

    Or even better. In some instances you can buy points/miles to gift to a rewards member without being a part of the program yourself. So just buy the points with your AmEx (which should count as airline spend) and get bonus points for yourself.

  4. Its ILLEGAL? I sold some points a few weeks ago. Am i going to be arrested? Seems like going against TOS and being illegal are 2 very different things.

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