Loyalty fraud is the deceptive practice of stealing or misusing loyalty program rewards or points, or airline miles, often by way of account takeovers, the creation of fake accounts, or through loyalty point resale. With account takeovers malicious actors gain access to a user’s loyalty program account and then abuse a member’s rewards. With fake accounts, fraudsters may create multiple accounts to accumulate points fraudulently or use fake identities to exploit promotional offers.
This type of fraud can affect airlines, hotels, retailers, and any other businesses offering loyalty rewards, with losses often amounting to millions.