American Airlines Shutdowns
About three weeks ago we covered the news that American Airlines was locking and shutting down some accounts for what they deemed a violation of the AAdvantage program terms. We believe the reason people were targeted for American Airlines shutdowns was the use of mailers which bypassed some of Citi’s anti-churning rules.
No Bonus Restricting Language
Specifically, certain targeted mailers from American Airlines had no language limiting people from getting the bonus over and over again. It was apparently even possible to get these mailers by signing up for new AAdvantage accounts in fake names and waiting a bit for a mailer to show up. Mailers weren’t tied to a specific name so this worked and people even bought/sold codes as well.
The result of this is that a group of people ended up signing up for many many Citi American Airlines credit cards by using legitimate codes that were meant for someone else. While Citi had no issue approving the accounts apparently, at some point American Airlines took notice and decided that using codes meant for someone else was a big no no. Hence the shutdowns and confiscation of miles.
What is an American Airlines AAdvantage Shutdown?
So what exactly does one of these shutdowns entail? Well, that is sort of the issue. American locked the accounts of tons of people they suspected of violating these rules over 3 weeks ago. I’m not here to argue whether they are right or wrong in that, but one thing I want to point out is that it is absolutely wrong for American to leave people in limbo for this long.
When they lock someone’s account they make it so they can’t use any of their miles, but the account is still there. Award tickets remain intact as well, but they will be cancelled if/when American gets around to banning them. But here is the issue. American has locked these people’s account without notice. No email has been sent. No communication. Perhaps that is alright at first, but to make people wait 3+ weeks is ridiculous, especially considering their now intact travel plans will be cancelled.
Two Wrongs Don’t Make A Right
If American wants to ban people who were legitimately approved for credit cards because of the fact they used mailers intended for someone else that is one thing. For them to make those people wait weeks (and time is still ticking) makes American a very bad actor in this scenario in my opinion. Two wrongs don’t make a right if that is indeed their point of view.
Now, I know their account security specialists have to review an account and contact the person, etc. but if you are going to lock accounts by the boat load, then have enough people to process those accounts. If not, then wait until you can communicate with the person about the shutdown before locking them out. In other words, I am in no way defending what people did with the mailers, but I am calling American Airlines out for how they are handling their end. It is incredibly shortsighted.
American Airlines Shutdowns – This Could Happen to You
I personally know a few people right now who have had their accounts in limbo for several weeks without any communication from American Airlines. While I am not surprised by this given my experience with their customer service, we should be talking about it. Remember, American legally feels they have the right to do this and that means it could happen to you.
Even if you didn’t knowingly violate program terms or sign-up for any mailers, maybe you are doing something else that American sees as fine today but will ban you for years from now. The point is they should be swift, transparent and respectful to their customers, even if they feel they broke the rules and deserve account termination.
Maybe you’ll argue that these mailer people are all terrible and they took advantage of a system. I’m not defending the practice, but on the base level let’s remember that these people all opened legitimate credit card accounts in the United States under their own name, social security number and AAdvantage number.
Citi could have stopped this at any time and denied the accounts but they didn’t. American could easily see people getting bonuses again and again, but they didn’t stop it either. Again, I am not arguing against the closure (that is beyond the scope of this post), but simply argue as one time customers and potential future customers (even if they can’t earn miles), they deserve the respect of not being in limbo for 3 weeks, a month or potentially even more.
Bottom Line
Right now I sit here with gifted top tier AAdvantage status that I plan to use and enjoy. At the same time I have routinely found American Airlines to be among the most customer unfriendly airlines every single time I fly. Their flight attendants are hit or miss and their gate agents seem to have made an art form out of being passive aggressive. Of course there are tons of great AA employees, just not the ones who decided it was okay to make people wait a month in limbo. That is not right. Shut them down now and let them move on or let these people use their miles. Two wrongs don’t make a right.
What do you think of these American Airlines shutdowns? Are you one of those people in limbo? Do rule breakers deserve any respect? Share your thoughts in the comments, but keep it clean and respectful.
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Sorry, but it is mail fraud, plain and simple. Read what the statue is.
What statue did you read? Ok, ok, spelling mistake ignored. But mail fraud is the most ridiculous suggestion I’ve heard to-date. What kind of have-not are you? Wow.
It blows my mind how many people think that playing by the rules (using a mailer, using a SSN, getting approved, and getting a bonus) is wrong. Banks make rules and play by the rules. We follow the rules. You think people on Wall Street don’t find every nook and cranny in every regulation? Unethical? For sure, but within the rules, they’ll make their millions and millions, and then take down the whole financial system. Where’s the hate on them? Us churners are not even pennies on the dollar.
I’m locked out and resigned to my eventual fate. However, in this whole mess the biggest issue is the complete lack of communication.
I spent 3 weeks in foreign countries wondering whether my award tickets home were going to be honored. Scrambling to find backup options, etc.
Now some think I deserve it, but those award tickets were not purchased using miles from mailers. In fact, a decent chunk of my AA account is from legit signup bonuses, shopping, spend on credit card, and butt in seat miles (currently AA gold).
What sucks even more is that I’m hub captive and so the company will still get my money and I’ll be crediting miles elsewhere.
We all know what 60,000 AA miles can buy. I have gotten MANY 60,000 mile one way business class tickets to Japan. In real money, if you had to pay for it, that is thousands and thousands of dollars. When you use coupon codes that were not yours to game the system you have cheated AA out of a revenue seat that they could have sold for thousands and thousands of dollars or it may have gone to a legitimate AA points earner that earned the points the hard way but were not unable to get that seat. I have opened and closed credit cards for years with AA, I have used the shopping portal, the dining club and even paid for seats. So, why should someone who gamed the system in this unethical manner (just because they found a way they could) get the seat but I could not? I have been in this hobby for over 25 years and have flown all over the world for free, but this “trick” is just theft to me. Plain and simple. They deserve to have their accounts frozen and lose everything in them and be banned.
There is nothing unethical about using an unrestricted mailer. What are you reading into this that isn’t there? Rhetorical. There is no trick to this. There is no game. Why would you have to open and close credit cards for years? Oh, that’s right, you were after the miles. What a hypocrite.
3 weeks for shutdown is really not that long. Has anyone ever been shutdown by PayPal? How long did you have to wait for your money?
And there were at least one lawsuit that I know of from this…
I do feel sorry for those affected. One possible compromise would be for those affected to seek employment at Walmart, since they already spend so much time there standing in line and buying money orders. Or they could collect cans from trash cans while they are dumpster diving for credit card mailers. Be sure and get a rabies shot in case you get bit by a trash panda.
You sound so sympathetic to those who took advantage of advantage
I’m with AA. I think they’re going easy on these these folks. I would ban them from the Advantage program for life and make them pay for AA tickets if they want to fly AA. Play the game, but do so fairly. If you need a lawyer to tell you the difference between right and wrong, there’s a lot more wrong with your life than a bunch of frequent flyer miles.
Um, that is what they’re doing. Banning them and canceling all award tickets. If that’s going easy, what would you think would be not “going easy”? Can’t ban paid travel as AA is a common carrier and would require a much stronger reason than this per regulations.
Steve,
You jelly, bro?
Steve, does that boot taste real yummy?
This amounts to pennies compared to the billions of dollars that AA has received in tax payer bailouts. They are profitable right now, so they think they can spit on customers and treat them however they want. Let’s also not forget that the miles earned from these bonuses were paid for by Citi and given to people per a contract that was made with Citi. They are going to wipe out their liability on their books for these miles, plus leave on the revenue that they earned from selling them in the first place. I highly doubt they will give them back to Citi as that would open a whole new can of worms due to different banking regulations and deceptive marketing practices. The reality is that it should be chalked up to a cost of doing business and implement safeguards to prevent this in the future on Citi’s side. Citi clearly allowed this and the reason why are many, but all speculative. Why would these mailers be exempt for the 48-month rule in the first place? They are sending them to customers that are new to AAdvantage, and obviously don’t currently have an AA Citi card or they would have already had an AAdvantage account, so why the hell would it need to be exempt in the first place? It wouldn’t matter if the rule was implemented on every single application because these targeted people have never had the card in the first place. Why don’t they just go back to the early 2000’s when there was no time restriction on getting a bonus and people received multiple bonuses? Surely it was a ‘deceptive’ practice back then also per the AAdvantage terms. Why not just strip all the million miler status miles accumulated from credit card spend and bonuses back then? Surely people just got the cards to pad that balance also. Deceptive? Sure, why not?
They are not only taking miles they feel were wrongfully accumulated they are wiping out accounts with miles that were earned from revenue flights, shopping portal, and from way before the mailers. No true explanation… just shut down for whatever they deem inappropriate
Outstanding post and thanks for writing it. There is a much larger issue here aside from the specifics and more people need to be thinking of and talking about it. I’m not impacted by the trAAin but AA’s conduct has tanked any desire on my part to patronize AAdvantage.
Following
If your new credit card went to the wrong address, and that person, knowing it was not theirs, used it anyway, then I think we would all agree that is wrong. Similarly, if one knowingly uses someone else’s code on a mailer, again knowing it was not theirs, then this is essentially the same as the credit card scenario.
This was not a loophole, but dishonest. Akind to smash and grab. They deserve all that AA throws at them. They should man-up and agree and tell AA as much.
The guy, Marty, I believe that spoke at the Chicago Seminars about how he jacked up his United account used a loophole and took advantage of the system. That was honest. And he paid for each of those rental cars. That was honest and smart on his behalf.
You are comparing using a promo/coupon code (that prefills information but lets you change it) to using someone else’s credit card?
This opinion is so damn played out.
It is not dishonest because the person applying is not pretending to be someone they are not. If the mailer was truely intended for only the person they mailed it to, they wouldn’t give you the option of changing but the name and address when you applied. They also did not include the regular bonus restricting language. Citi knew what they were doing.
You clearly don’t understand the whole scope of who has been impacted. Many did nothing analogous to what you wrote. Some didn’t even use any mailers period.
All of which is separate from the point of the post
So Byron, I get targeted junk mail all the time. So if I give somebody the scratch off discount code from my local car dealer, do I get to accuse them of theft too? I’ll bet 99% of the Citi/AA mailers get thrown in the trash. Signing up for a new credit card is a significant financial decision, not unlike buying a car. If I have no need of a new car, why shouldn’t my neighbor get the benefit instead?
“Similarly, if one knowingly uses someone else’s code on a mailer, again knowing it was not theirs, then this is essentially the same as the credit card scenario.”
What if you were given the mailer by the person it was addressed to? The mailers did not have any explicit non-transferable language on them, Citi had other true non-transferable mailers, and the recipient handed it over willingly.
It’s less akin to your analogy and more akin to your friend hearing you’re going to Bed, Bath, and Beyond and handing you a coupon sent to them.
Have you even seen a physical mailer? I didn’t think so.
If you would examine one of these mailers, and read the terms and conditions, as most who receive them would do (right?) there are no terms that make this wrong or dishonest. These mailers have a full page of tiny-print terms and nowhere did it say they have to be used by the person they were mailed to. IN FACT, as was discovered, they could be used up to 5 times by 5 different people! Not 6, so Citi obviously thought that 5 was enough. But also not once, or twice. 5 times.
There were absolutely no restrictions stated as to what the original recipient was allowed to do with the mailer code.
When doing an application from a mailer, people would HAVE TO provide their SS numbers and full identification. And Citi checked credit reports and dinged your credit report with a hard pull. So they knew who was applying and if they had applied before. In fact, they did limit the number of applications over a given amount of time. They were obviously worried about this number. But apparently not any of the others? Dishonest? I think Citi is being dishonest in not fessing up to being the real issue here,
But your slanted, misinformed opinion is noted.
So did the mailers go to real people who actually signed up for their first AA account, or did folks make up names and/or sign up for multiple AA accounts to get the mailers? If the latter, then I think that AA has the winning argument. But if the mailers went to real people signing up for an AA account for the first time, and those real people then transferred the mailers, then I think AA is on the wrong side of this.
In some cases their were fake accounts created just to generate mailers yes.
But in many cases no there were not. AA doesn’t seem to care which it is. There are multiple cases of people only using a mailer sent to either themselves or their spouse at the same address. I couldn’t tell you what the % split is other than to say there are significant numbers of both.
But where is the line? Either they are transferable or they aren’t. Is it OK to use one sent to your spouse? Your roomate? Your cousin? Your coworker? A stranger on the internet? Where’s the line?
Do you think it’s not ok to use a bed bath and beyond coupon if it’s not addressed to you (or some other random coupon for whatever store)? Even if we limit this to credit cards there are plenty of examples of physically mailed codes addressed to one person that are perfectly fine to transfer to someone else. Why would this be any different?
Here’s a few facts for you:
1) Citi has two kinds of mailer codes. One kind that is not transferable (ie you cannot change the name on the application page) and a kind that you can. If they wanted to prevent this all they had to do was only use the non-transferable kind.
2) The kind that you can do not say *anywhere* that you are not allowed to transfer the offer to someone else in the terms either on the physical mailer or in the full terms in the online application page.
3) Noone who signed up misrepresented themselver. They used their real name, address, SSN and FF#. Citi underwriting then approved them for the card and deposited the miles. Are you telling me Citi can’t look at their own data and say “wait this person has 5 of these already and they are still open, maybe we shouldn’t give them another?”.
4) Everyone completed the spend as agreed with Citi, earning Citi swipe fees and possibly other fees including annual fees.
5) I just want to stress this again. Lots of people who have been shutdown never lied to anyone. Never created fake accounts with AA. Their only offense was using a coupon code not directly addressed to them in violation of absolutely zero terms. And now AA is stranding those people in some cases in foreign countries at the last second with no recourse, costing some of these people thousands of dollars unexpectedly just to get home.
Sure if you want to argue those who created fake accounts broke some terms that could be true. But I’d argue even in that case this is a massive, vindictive overreaction. Close the fake accounts, tell the customer to never do it again and maybe assess a fine sure. But what they are doing is insane.
As best as I can recount my own history (I didn’t keep records because why would I need to?). Sometime around 2016 we were considering taking out cat with us on a longer-than-usual trip to Florida. As a joke, and just for fun, he got an AA FF# (I think he had an Airtran #, but they were no more or going to be soon). No fraud or exploitation considered. It was harmless enough.
Mailers started coming hot and heavy and we kept throwing them out. My adult son signed up for an AA# at my address. He started getting mailers too and we threw them out as he was NOT ready to handle a credit card. Sometime in LATE 2018 I became aware of the usefulness of mailers. I read over the terms and conditions carefully. It seemed that these things were not restricted in any way. I ended up using my first mailer then and quit throwing them out. I never sold one and I had plenty as we would get 2-3 A MONTH and a large stack accumulated. As mailers expired, more came in to replace them.
I cannot say which mailers I used or didn’t … again, I didn’t keep records of this. I certainly could have only used mailers that came for my son, as again, there were more than enough. That’s what I’m going with. In the end, a huge stack all expired as they quit coming in the mail.
Citi apparently decided to stop sending these out. A few months later AA has a knee-jerk reaction to how freely Citi was handing out miles. But it’s my evil? I don’t think so.
You are also leaving an important aspect of the locks out: Someone who isn’t redeeming any miles will not know their account is locked unless either 1) They specifically ask AA customer service or 2) They call AA for something else and customer service notices the note on their account. So there are likely many people out there who have no idea and are still crediting miles from paid flights to AA, spending on credit cards (even if past the sign-up bonus spend), shopping using the AA portal, etc.
If AA wants to ban someone, fine, but it seems awfully unethical to not give any sort of notice to someone still earning miles in ways AA deems acceptable that they’ve been locked for weeks and those miles may never be able to be redeemed.
Excellent point!
Nail on the head.