Is It Legal To Sell Airline Awards

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Note: I am not an attorney and the following is not legal advice, it is merely my opinion as a travel expert.

I received this question from a reader recently

I just am curious how you know it’s “perfectly legal” to sell awards.I would like to sell some miles but looking for documentation on the legality of it.
Thanks so much.

-Jay

Yes, it is perfectly legal to an airline award. By this, I mean that, to my knowledge, there is no federal, state, or local laws forbidding the sale of an airline award. By doing so, you are not committing a crime, so you can not be arrested, tried, or convicted for doing so. At the very least, I have never heard of such a thing happening.

What you are doing is violating the terms of the frequent flier program, as they all forbid the sale or barter of awards. This is a far cry from breaking the law. Corporations can invent their own rules, but they can’t actually create laws by themselves. If someone is caught by the airlines ing, selling, or bartering awards, that company can take several actions. They can cancel the award ticket and they can suspend the frequent flier accounts of both the er and the seller. What they cannot do is call the police, since, as far as I know, no actual laws have been broken.

When Do Airlines Catch People?

There are reports that airlines have computer systems in place that try to catch those who are ing, selling, or bartering awards. First, they would look at the name of who is traveling versus the name of the account holder who redeemed the awards. Obviously, if it is the same person, it can’t be bought, sold, or bartered. Similarly, if the last names are the same, it is certainly not a potentially fraudulent case. Even if the last names are different, there are many explanations. It is perfectly within the rules of all programs to redeem miles for an award in someone else’s name, so long as it is as a gift. Since it is very common for close family members to have different last names, I am not sure how an airline would begin to distinguish between me giving an award to my father-in-law, and it’s sale to a third party. the same would be true of awards given to friends. Certainly, if you are constantly redeeming awards for people around the world who are traveling to and from various destinations that you have never been to, that might raise some red flags. In those cases, the traveler may be asked a few basic questions at the airport during check in. These questions will be along the lines of: Who gave you this award? What is their relationship to you? How long have you known them? Did you purchase it or trade for it?  If you can’t answer those questions, they would be right to suspect you ing or bartering for an award.

What Should You Do

Despite it being perfectly legal to sell an award, that doesn’t mean you should do it. I do not think it is worth the risk of forfeiting miles and ruining travel plans. Many airlines will now allow you to redeem miles for gift cards or other merchandise. Selling these items is a lot safer.

That said, I am a big fan of giving awards to family and friends. Among us, we pool our miles and utilize them in the best way to save money. We do not keep very close track of who gets what, so it is no more a case of bartering than people who give each other birthday gifts or holiday presents each year. I recently did give an airline award to a family member with a different last name. In order to make sure there is no confusion, I will send them a letter indicating that they are members of my family and that my award is a gift. In the unlikely event that they are confronted by the airline, this should serve as proof that they have not violated the airlines terms of their frequent flier program.

 

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