3 On Your Side: Selling Frequent Flyer Miles Is Risky
By Jim Donovan
PHILADELPHIA (CBS) -- Do you have frequent flyer miles or credit card points you're wondering what to do with? Well some people are now selling their miles and points and making hundreds, even thousands of dollars! But 3 On Your Side Consumer Reporter Jim Donovan warns, before you cash-in you need to know the risks.
With a busy travel schedule and a points-earning credit card, Carlyn racked up thousands of airline miles with no immediate plans to redeem them. Enticed by online ads from mileage brokerage companies, which offer money for miles or points, she decided to give it a try and sold more than 57,000 miles for $460 dollars. She says, "I didn't see a value in holding onto them hoping that I would find a flight I could use."
Though Carlyn made a nice profit experts say each time you sell your airline miles or points you're taking a gamble. Brian Kelly is a frequent flyer expert known as The Points Guy. He says, "Lately it's become very popular and it's becoming a big business but there are a lot of risks involved."
If you check the fine print of many reward programs you'll find selling your miles or points is not allowed. If you get caught, you could have your account cancelled and be banned from the program. According to Kelly, "The airlines are pretty clear and they play hardball with people who sell their miles and points."
When people sell miles or points, brokers redeem them for an airline ticket they sell to someone else. The industry is watching for transfers and tickets that seem unlikely. Kelly says, "The airlines and credit card companies are looking for transferring of points to people in different states, different last names in different geographical regions."
In some cases it is permitted to transfer points or miles to family or friends, each airline's terms and conditions vary, so before you move any miles around be sure to check. By the way, because selling miles and points is against the terms and conditions of many frequent flyer programs, that's why the traveler in our story only wanted to use her first name.
American Airlines- AAdvantage Program Conditions
http://www.aa.com/i18n/AAdvantage/programInformation/termsConditions.jsp
United Airlines- MileagePlus Rules
http://www.united.com/web/en-US/content/mileageplus/rules/default.aspx
Delta Airlines- SkyMiles Program Rules & Guidelines
http://www.delta.com/content/www/en_US/skymiles/about-skymiles/program-rules-conditions.html
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