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Jun 22, 01, 8:10 am
Airlines Attempt to Thwart Sales
Of Frequent-Flier Miles on EBay
By JANE COSTELLO
THE WALL STREET JOURNAL ONLINE
John Robinson won't be selling any more frequent-flier miles online.
Last December, Mr. Robinson decided to use the eBay auction Web site (www.ebay.com) to sell a certificate for 500 American Airlines AAdvantage miles. An engineer from Kansas City, Mo., he had 200,000 miles in his frequent-flier account, and wanted to sell the mileage certificate that he received as a reward from Greenpoints, a virtual version of the legendary S&H Green Stamps program.
Mr. Robinson posted the certificate on eBay and waited for the bids to roll in. Two days later he received an e-mail from American Airlines telling him to stop the sales effort.
"Your attempt to auction this offer on eBay...violates the terms of the offer and the AAdvantage program," reads the note from Lisa Lowe, a member of what tech-savvy airline passengers refer to as American's "eBay police." "Please cease your attempt to sell the certificates and end your auction immediately."
In addition, the note warned Mr. Robinson that those who bid on his certificate would also be held accountable by the airline.
"If you continue with the sale, we will contact the bidders and/or buyer and inform them that the certificate is void," wrote Ms. Lowe. "We will also give this information to eBay."
Mr. Robinson was aware of the fact that selling AAdvantage miles violates program rules, but decided to take the chance. And while he says he understands American's position, he's concerned about the tactics being deployed by the airline to discourage the sale of miles.
"I didn't like the fact they said they would contact my bidders," he says. "It's like they're saying 'I know who you are and I want to stop you.' It makes me wonder what else they're going to say I can't sell on eBay."
More Warnings
Officials at eBay weren't aware that American has been warning its customers about the possible consequences of purchasing AAdvantage miles. As a general rule, the company takes a hands-off approach regarding the interaction between sellers, bidders and third parties.
Kevin Pursglove, an eBay spokesman, says that the airlines are within their rights to contact consumers if they believe they have an obligation to inform them about certain characteristics of an item. But they aren't supposed to try and interfere with a bid.
"That's not kosher," he says.
American spokesman Dale Morris defends the airline's decision to take a proactive approach to people who attempt to sell tickets or miles online. The airline maintains an "About Me" page on eBay that clearly states the policy regarding the sale of miles or tickets, and those who choose to who disregard American's policies are subject to the consequences.
"In our member guide it says you cannot sell, barter or purchase any certificates," Mr. Morris says. "We adhere to that, and are actively looking at people who do that."
Mr. Morris declined to say when American began sending e-mails to auction participants, but eBay aficionados note that the number of AAdvantage mileage certificates up for sale is down significantly in recent months.
"I'd say between 90% and 100% of people have pulled their auctions down within the last year," says Robert Linderman, an eBay customer from Akron, Ohio, who also has more than 400,000 AAdvantage miles in his account. After having seen a copy of the correspondence from American Airlines, he says he has no plans to auction off any miles in the future.
"To get a letter like that would put the fear of God in me," he says.
Other Carriers Follow Suit
American isn't the only airline that takes a stand on the sale of miles online. Representatives from Delta Airlines' Revenue Protection Unit now send similar warnings to eBay participants -- often within hours after an item has been put up for bid. The "Dear eBay User" letter warns violators that "improperly obtained certificate/tickets are VOID and will be confiscated."
A spokeswoman for Delta declined to comment on the activities of the airline's Revenue Protection Unit.
Most other airlines take a less militant approach, even though all frequent-flier programs prohibit the sale and transfer of miles and awards.
United Airlines posts a note on its Web site (www.ual.com) warning users not to auction or purchase miles or tickets through eBay. A spokeswoman for the airline says that United does monitor auction sites, but won't say how aggressive the airline is about taking action.
But unlike American, which has made thousands of mileage certificates available to the general public by giving them away to people who purchase set quantities of cereal, frozen dinners or chocolate pudding, United doesn't have the sheer volume of mileage certificates that could fall into the hands of people more interested in turning a profit than taking a trip.
At the opposite end of the spectrum is Southwest Airlines, which doesn't have a mileage based frequent-flier program. Instead of banking flight mileage, passengers automatically receive a free ticket after completing eight round-trips.
The airline states that its free tickets "have no cash value and are void if sold, purchased, brokered or bartered," but on any given day eBay is teeming with hundreds of Southwest tickets for sale. Some enterprising entrepreneurs attempt to unload the tickets in the guise of drink coupons: There are numerous items up for bid entitled "Southwest Airlines Drink Coupons + R/T Ticket," with bids ranging from $200 to $300.
"If we can identify them, we send them a letter and ask them not to do it," says Southwest spokeswoman Melanie Jones. "But lots of times, we can't identify them, so we don't."
EBay's Mr. Pursglove says that several airlines have attempted to persuade the company to prohibit the sale of frequent-flier certificates, but have been unsuccessful to date.
"They need to give us solid legal reasons why we should remove them, but they haven't so far," he says.
In the meantime, the airlines' officials are banking on the fact that an e-mail from American's "eBay police" will have a chilling effect on the number of miles up for sale.
"Normally, people are pretty cooperative once they get the letter," American's Mr. Morris says.
Of Frequent-Flier Miles on EBay
By JANE COSTELLO
THE WALL STREET JOURNAL ONLINE
John Robinson won't be selling any more frequent-flier miles online.
Last December, Mr. Robinson decided to use the eBay auction Web site (www.ebay.com) to sell a certificate for 500 American Airlines AAdvantage miles. An engineer from Kansas City, Mo., he had 200,000 miles in his frequent-flier account, and wanted to sell the mileage certificate that he received as a reward from Greenpoints, a virtual version of the legendary S&H Green Stamps program.
Mr. Robinson posted the certificate on eBay and waited for the bids to roll in. Two days later he received an e-mail from American Airlines telling him to stop the sales effort.
"Your attempt to auction this offer on eBay...violates the terms of the offer and the AAdvantage program," reads the note from Lisa Lowe, a member of what tech-savvy airline passengers refer to as American's "eBay police." "Please cease your attempt to sell the certificates and end your auction immediately."
In addition, the note warned Mr. Robinson that those who bid on his certificate would also be held accountable by the airline.
"If you continue with the sale, we will contact the bidders and/or buyer and inform them that the certificate is void," wrote Ms. Lowe. "We will also give this information to eBay."
Mr. Robinson was aware of the fact that selling AAdvantage miles violates program rules, but decided to take the chance. And while he says he understands American's position, he's concerned about the tactics being deployed by the airline to discourage the sale of miles.
"I didn't like the fact they said they would contact my bidders," he says. "It's like they're saying 'I know who you are and I want to stop you.' It makes me wonder what else they're going to say I can't sell on eBay."
More Warnings
Officials at eBay weren't aware that American has been warning its customers about the possible consequences of purchasing AAdvantage miles. As a general rule, the company takes a hands-off approach regarding the interaction between sellers, bidders and third parties.
Kevin Pursglove, an eBay spokesman, says that the airlines are within their rights to contact consumers if they believe they have an obligation to inform them about certain characteristics of an item. But they aren't supposed to try and interfere with a bid.
"That's not kosher," he says.
American spokesman Dale Morris defends the airline's decision to take a proactive approach to people who attempt to sell tickets or miles online. The airline maintains an "About Me" page on eBay that clearly states the policy regarding the sale of miles or tickets, and those who choose to who disregard American's policies are subject to the consequences.
"In our member guide it says you cannot sell, barter or purchase any certificates," Mr. Morris says. "We adhere to that, and are actively looking at people who do that."
Mr. Morris declined to say when American began sending e-mails to auction participants, but eBay aficionados note that the number of AAdvantage mileage certificates up for sale is down significantly in recent months.
"I'd say between 90% and 100% of people have pulled their auctions down within the last year," says Robert Linderman, an eBay customer from Akron, Ohio, who also has more than 400,000 AAdvantage miles in his account. After having seen a copy of the correspondence from American Airlines, he says he has no plans to auction off any miles in the future.
"To get a letter like that would put the fear of God in me," he says.
Other Carriers Follow Suit
American isn't the only airline that takes a stand on the sale of miles online. Representatives from Delta Airlines' Revenue Protection Unit now send similar warnings to eBay participants -- often within hours after an item has been put up for bid. The "Dear eBay User" letter warns violators that "improperly obtained certificate/tickets are VOID and will be confiscated."
A spokeswoman for Delta declined to comment on the activities of the airline's Revenue Protection Unit.
Most other airlines take a less militant approach, even though all frequent-flier programs prohibit the sale and transfer of miles and awards.
United Airlines posts a note on its Web site (www.ual.com) warning users not to auction or purchase miles or tickets through eBay. A spokeswoman for the airline says that United does monitor auction sites, but won't say how aggressive the airline is about taking action.
But unlike American, which has made thousands of mileage certificates available to the general public by giving them away to people who purchase set quantities of cereal, frozen dinners or chocolate pudding, United doesn't have the sheer volume of mileage certificates that could fall into the hands of people more interested in turning a profit than taking a trip.
At the opposite end of the spectrum is Southwest Airlines, which doesn't have a mileage based frequent-flier program. Instead of banking flight mileage, passengers automatically receive a free ticket after completing eight round-trips.
The airline states that its free tickets "have no cash value and are void if sold, purchased, brokered or bartered," but on any given day eBay is teeming with hundreds of Southwest tickets for sale. Some enterprising entrepreneurs attempt to unload the tickets in the guise of drink coupons: There are numerous items up for bid entitled "Southwest Airlines Drink Coupons + R/T Ticket," with bids ranging from $200 to $300.
"If we can identify them, we send them a letter and ask them not to do it," says Southwest spokeswoman Melanie Jones. "But lots of times, we can't identify them, so we don't."
EBay's Mr. Pursglove says that several airlines have attempted to persuade the company to prohibit the sale of frequent-flier certificates, but have been unsuccessful to date.
"They need to give us solid legal reasons why we should remove them, but they haven't so far," he says.
In the meantime, the airlines' officials are banking on the fact that an e-mail from American's "eBay police" will have a chilling effect on the number of miles up for sale.
"Normally, people are pretty cooperative once they get the letter," American's Mr. Morris says.