Ethics of the Prestige 4th night free

Old Jul 9, 15, 10:56 am
  #46  
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Originally Posted by cbn42 View Post
In your contractor analogy, you are agreeing on a price in advance. You are not reimbursing the contractor's actual expenses. In order to make your analogy work, your corporation would have to give you a fixed amount of money rather than paying the actual hotel and flight expenses. If they are giving you a per diem for food and lodging, then there's certainly no problem with you using a personal card and keeping the points/miles. If they are reimbursing your actual costs, that would be like the contractor getting a kickback from the lumberyard and billing you the cost.
Well in my case... I submit a general "report" of expected expenses, and then it gets approved, and then I book.. as long as the expense isn't unreasonably higher than reported, it's OK, which is why I used the "price in advance" analogy.

I guess the ethics here just depends on how you report these things and how they get approved by your company/client.
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Old Jul 9, 15, 11:21 am
  #47  
 
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Originally Posted by beachfan View Post
Also, I don't hear anyone who keeps the rebate saying they pay taxes on the income produced by an expense reimbursement larger than true expenses (after deduction of float interest of course!).
We're required to book all travel through Concur, so I'm not able to take advantage of this for business stays, but I would agree the income is taxable.
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Old Jul 9, 15, 2:15 pm
  #48  
 
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Originally Posted by djtsukasa View Post
Just wanted to extend the discussion over at VFtW regarding the ethics of taking a travel reimbursement and keeping the 4th night free rebate for yourself over here to flyertalk. Thoughts on this?

http://viewfromthewing.boardingarea....-for-yourself/
I do not think this is unethical but I would not do it. I wouldn't want the slightest risk, no matter how slight, to have the smallest negative effect, no matter how small, on my job.
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Old Jul 12, 15, 5:15 am
  #49  
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Originally Posted by djtsukasa View Post
Well in my case... I submit a general "report" of expected expenses, and then it gets approved, and then I book.. as long as the expense isn't unreasonably higher than reported, it's OK, which is why I used the "price in advance" analogy.
I don't see how the approval process matters. In the end, you are still being reimbursed for actual expenses, not a negotiated rate.

Originally Posted by djtsukasa View Post
I guess the ethics here just depends on how you report these things and how they get approved by your company/client.
I have to disagree with that. The reporting and approval process are irrelevant. What matters is the type of reimbursement. If you are being reimbursed a fixed rate, you can take all the incentives you want, because you are receiving an incentive from a company that is trying to get your money. If you are being reimbursed for actual expenses (even if they have to be pre-approved) and you accept miles or points, then you are receiving an incentive from a company in return for directing someone else's money to them, which makes it a kickback.
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Old Jul 13, 15, 12:21 pm
  #50  
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Originally Posted by cbn42 View Post
I don't see how the approval process matters. In the end, you are still being reimbursed for actual expenses, not a negotiated rate.



I have to disagree with that. The reporting and approval process are irrelevant. What matters is the type of reimbursement. If you are being reimbursed a fixed rate, you can take all the incentives you want, because you are receiving an incentive from a company that is trying to get your money. If you are being reimbursed for actual expenses (even if they have to be pre-approved) and you accept miles or points, then you are receiving an incentive from a company in return for directing someone else's money to them, which makes it a kickback.
By that logic, any miles/points received from CCs OR actually flying is a kickback from a company that wants your money. Even more so now for example with United/Delta's earning structure. You get miles based on how much you spend with them. Is that ethical...?

I do think the approval process matters, because you are being upfront about how much money you are going to cost the company, and they approve. IF they approve one amount and you charge them another thats a different story in my opinion, but.. if you say you are going to spend X amount of money and then charge them the same X amount of money, not sure where any other rebates you might receive are considered unethical?
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Old Jul 13, 15, 12:41 pm
  #51  
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Originally Posted by djtsukasa View Post
By that logic, any miles/points received from CCs OR actually flying is a kickback from a company that wants your money. Even more so now for example with United/Delta's earning structure. You get miles based on how much you spend with them. Is that ethical...?
You know what is really unethical? Waiting to buy a ticket 13 days prior to departure instead of 14 days so that one not just earn more miles on UA/DL but also book into a higher booking code for airlines that prioritize upgrades by booking code as well. This will hit the client more in the pocket more than the 4th night free credit from Citi Prestige as the client would have paid the same hotel costs regardless of form of payment (assuming lowest hotel rate is a publicly available rate instead of a corporate negotiated rate).
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Old Jul 13, 15, 3:10 pm
  #52  
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Originally Posted by seawolf View Post
You know what is really unethical? Waiting to buy a ticket 13 days prior to departure instead of 14 days so that one not just earn more miles on UA/DL but also book into a higher booking code for airlines that prioritize upgrades by booking code as well. This will hit the client more in the pocket more than the 4th night free credit from Citi Prestige as the client would have paid the same hotel costs regardless of form of payment (assuming lowest hotel rate is a publicly available rate instead of a corporate negotiated rate).
Indeed.. which goes along with my argument of "approval" being that the client/company approves 1 cost, and that cost doesn't change.
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Old Jul 21, 15, 9:16 pm
  #53  
 
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Interesting thread - I assumed this would be here and it was!

How about another scenario (or two):
The $250 airline credit - seeing as how this is automatically deducted - should I only bill a customer the net cost of a flight? I think that the $250 is mine, and I would happily apply it to a personal flight if I had the choice, but I don't. I don't feel guilty or unethical about this one at all.

Another similar scenario - I have a Ritz card with a $300 travel credit. I was recently forced to change a flight (customer requested - "as long as the change fee is ridiculous... $500+ in their words). Supposedly change fees are allowed with the Ritz card, but not sure if this is considered one of the triggers for automatic reimbursement.

But if they have agreed to the change, and I'm paying my AF on that card for this type of benefit - I don't think I have an issue with this either. This will not cover the cost of my AF or even burn through the $300. If I had a choice to save this for a personal flight, I don't think I would because I wouldn't be in a situation (typically) to need to change the flight like I would for business flights. I admit, I'm a little more un-easy about this one, but don't think I'll lose any sleep at night.
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Old Jul 23, 15, 9:03 am
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Originally Posted by Ftbgtx View Post
Interesting thread - I assumed this would be here and it was!

How about another scenario (or two):
The $250 airline credit - seeing as how this is automatically deducted - should I only bill a customer the net cost of a flight? I think that the $250 is mine, and I would happily apply it to a personal flight if I had the choice, but I don't. I don't feel guilty or unethical about this one at all.

Another similar scenario - I have a Ritz card with a $300 travel credit. I was recently forced to change a flight (customer requested - "as long as the change fee is ridiculous... $500+ in their words). Supposedly change fees are allowed with the Ritz card, but not sure if this is considered one of the triggers for automatic reimbursement.

But if they have agreed to the change, and I'm paying my AF on that card for this type of benefit - I don't think I have an issue with this either. This will not cover the cost of my AF or even burn through the $300. If I had a choice to save this for a personal flight, I don't think I would because I wouldn't be in a situation (typically) to need to change the flight like I would for business flights. I admit, I'm a little more un-easy about this one, but don't think I'll lose any sleep at night.
IMO, these examples are less questionable, as the card benefits are fungible across different flights or hotel stays, whereas the rebate from the 4th night free promo is directly tied to each specific booking.
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Old Jul 23, 15, 9:21 am
  #55  
 
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Goes along the same lines as business travelers earning miles for their personal travels; using personal card to get miles/points for business trips; using cashback/points reward portals to do reimbursable expenses.

So its no different than the above, just an unheard of amount compared to what we're used to seeing. Credit card companies / loyalty programs have been rewarding business travelers for many years.

What WOULD be unethical/breaking rules would be.... booking full fare economy for more miles; stretching your business trip to 4 days so you can get the 4th night benefit.

If companies really wanted to crack down on this (or to cut cost by getting rebate direclty to themselves) they would need to upgrade their purchasing department to a centralizing purchase system to get the cashback/rebates and make sure they're getting the best fares. Many companies are moving in this direction already.
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Old Jul 26, 15, 11:53 pm
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Until I found this thread, the thought never even crossed my mind to use the fourth-night benefit for work travel. Part of the reason is that even though I love the benefit and have used it twice for personal travel, the whole process is really nebulous and sketchy. They send you a PDF file that should completely clarify the transaction, often with a total cost slightly under what I see on kayak. But the PDF is missing all kinds of crucial detail like the amount of the fourth-night discount, the number of people staying in the room, even the room type you have reserved. So basically you have to take their word for it on the phone about how much your net cost is going to be.

Well, now maybe I understand why Citi is doing this. They are probably trying to encourage people to pocket the fourth night on work travel, and therefore want to make it seem as much as possible like a benefit that is decoupled from the actual transaction. This seems kind of sketchy on on Citi's part, actually.

My employer gives us a choice of either getting actual expenses or taking a per diem (and we can make the choice separately for food or food+lodging). This is nice, because sometimes I travel to cities where I have friends, stay with my friends, and thank them by taking them out to a nice dinner. I then request reimbursement for the dinner, which is way cheaper than multiple nights of hotel, so everybody wins. This is all completely above board and legal, with per diem rates even set by the IRS and state department. Technically I don't even have to present a receipt to receive reimbursement up to the per-diem.

So theoretically what I could do when traveling to a city with a high per-diem rate is stay in the cheapest fleabag hotel I can find, request the maximum per-diem reimbursement, and then pocket the difference. Is that ethical and legal? I think so. But it's also pretty sketchy. I don't know anybody who does that. It's like exclusively showering at work to save money on your water bill, or having work hire you an uber just so you can can eat the driver's free snacks. What kind of person are you if you do this?

Now I could see maybe using the prestige fourth-night benefit in conjunction with a per diem, particularly if the fourth night is a personal day you tacked onto a work trip. Request reimbursement for 3/4 of your hotel stay, and then get the fourth night reimbursed by this benefit. That's kind of like taking three work flights and using the resulting air miles to book yourself an award ticket for personal travel. But if you get all four nights reimbursed claiming actual expenses instead of per-diem, well, that starts to feel pretty shady--more like taking three work flights, using the resulting air miles to book your fourth work flight, and then requesting reimbursement for the fourth flight as if you'd bought a revenue ticket.

The only thing that makes pocketing the money a plausible scenario is how Citi chooses to provide you the hotel quote. With the previous iteration of this card, Chairman, there was a two-for-one airline benefit, and a 15% air fare reduction benefit, but both were far more transparent transactions. When I brought a companion on a work trip, I would divide the total cost of both tickets by two and ask for that reimbursement, along with documentation showing this was significantly cheaper than a single ticket. I often used the 15% reduction, as it was marginally better than my employer's meager negotiated discount, but I would never have pocketed the 15%, nor would anyone else. In both cases, this is because the receipts made it plainly clear what was going on. By contrast, the fourth-night benefit seems intentionally designed to create this sketchy gray area.

The bottom line is that sometimes there are things that could in theory save your employer some money, but the paper trail or lack thereof makes it impossible to account for expenses properly. That's actually the whole point of per-diems. But if you aren't taking a per diem, then sometimes you just have to do something more expensive that leaves a better paper trail. (E.g., in foreign countries, I often use ground transportation that lets me pay with a credit card, because then I know I can be reimbursed for my actual USD cost. That's even though if I weren't getting reimbursed, I'd find a cheaper driver who'd take cash and not provide any kind of receipt.)
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Old Jul 30, 15, 11:24 am
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Apparently, you can book the hotel with Prestige, then pay with a different credit card, then get the statement credit on your Prestige statement anyway, as reported here:

http://frequentmiler.boardingarea.co...th-night-free/

So the argument that if employers cared they could prevent this by requiring use of a corporate credit card doesn't work.

I really wonder how Citi is breaking even with this benefit. Do they get a massive referral fee from the hotel? If the process were super easy to book, I could see them trying to lull people into always using their travel agent, even for shorter hotel stays. But as it is the whole process is such a pain that people will only use it for the 4th-night benefit.
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Old Jul 30, 15, 12:15 pm
  #58  
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Originally Posted by ftweb View Post
... wonder how Citi is breaking even with this benefit.
Citi does not provide this, it's offered by MasterCard. Citi recently agreed to use MasterCard as their primary network worldwide. I speculate that this benefit is one of the concessions that Citi obtained from MasterCard in the negotiation.

I think it's a pilot program, which will be changed (or eliminated) in a year or two.

Citi has tried before to offer a product to compete with American Express Platinum. The American Express Fine Hotels and Resorts program often offers 3rd or 4th night free promotions on top of various other benefits, but only at their contracted rates. I think this is an attempt to lure consumers away from American Express Platinum, by offering a uniform fourth night free without any others perqs. If it meets their objectives, CWT can go back to hotels, show them how much business CWT has brought to them, negotiate a formal program, and MasterCard can relaunch the benefit with a network of participating hotels.
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Old Aug 5, 15, 10:02 pm
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Booking full fare economy (Y) is not unethical. Sometimes, it is the only fare left. Sometimes the client asks you to book a refundable ticket because they may want to change your dates on site with them.
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Old Aug 13, 15, 5:13 pm
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Just because I found this discussion fairly interesting, I'll add my 2c to the mix (albeit a little late).

There is nothing at all wrong with keeping the fourth night benefit for yourself, so long as you do not unnecessarily extend the trip and you continue looking for the best rate available. I'm not sure why the size of the rebate bothers some so much but it's literally no different than earning points on any other work related flight or hotel stay.

To put this in context, my firm has gives employees a choice between using a corporate card or their personal CC's for work related travel. The corporate card is expressly marketed in our personnel manual as a way to minimize the inconvenience of travel by reducing expense paperwork. But in the same manual section it states that for those that are comfortable floating work expenses for two to three weeks, using a personal card is allowed to capture miles or points for future personal use. And when you talk to our department leaders, they expressly try to steer new staff who will have frequent travel into using their own cards to capture miles! This is all very transparent and above board here - you produce a receipt showing what the hotel cost and whatever rewards you get back you keep. Not sure why other companies are so different or would have a problem with this. As was said up thread, if they want to capture my rewards then they need to be prepared to pay my annual fee.
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