Originally Posted by platbrownguy

So I looked up the case on PACER and found the "criminal information" (selected pages attached) that explains the scheme. Evidently Schwarze bought gift cards with real credit cards, then he would use those gift cards to buy AA tickets, and then he went to the AA refunds site... but by entering the Gift Card "MSR" (Miscellaneous Sales Receipt) number rather than a ticket number, he was able to exploit a weakness in AA's refund-system technology to cause AA to refund the gift card while retaining the validity of the tickets bought using the gift card.

So at the end of the day, Schwarze's credit cards were not charged anything (at least, net of refunds), but he was able to enjoy the value of AA tickets bought with gift cards that had been refunded (and presumably in some/many cases, he was able to send others flying in exchange for cash that he kept).

I think this goes in the category of "fool me once, shame on me; fool me twice, you're a federal felon."