Travel agent cheated his way to 42M Delta frequent flyer points, feds say – Fox Business

Travel agent cheated his way to 42M Delta frequent flyer points, feds say - Fox Business
Man stole 42 million Delta frequent-flyer miles, prosecutors say
Morning Business Outlook: United Airlines is getting rid of the expiration date for its MileagePlus program.

A man was indicted this week after federal prosecutors say he earned more than 42 million Delta frequent-flyer miles by committing fraud.

Deltas SkyBonus program allows businesses to collect points when their employees travel with the airline that can be spent on flights and other airline perks. But theres an important caveat: The traveler must actually be an employee of the company to be eligible. Prosecutors say that Podolsky set up a SkyBonus account through a fertility center owned by a family member of Vega International Travels president, then booked tickets for his clients using that account and fraudulently passed them off as employees of the fertility company.

“His Methods Are Trade Secret”: Travel Agent Gamed Delta Of $1.75 Million

Gennady Podolsky is a managing partner of a Chicago-based  travel agency, Vega International Travel Services. According to prosecutors, he earned the miles through Deltas SkyBonus program, which allows businesses to earn frequent flyer “SkyMiles” when their employees travel.

According to the indictment, Podolsky created a SkyBonus account for a fertility center that was owned by a relative of Vegas president. When Podolskys customers flew Delta, booked through Vega Travel, he would enter the fertility centers SkyBonus information, even though the travelers were not employees of the fertility center, nor had any connection to it.

“Podolsky used his knowledge of the travel industry to take advantage of his travel agency clients,” U.S. Attorney Byung Pak said in a statement. “Through his access, he allegedly took advantage of Delta Airlines corporate frequent flyer program, illegally reaping millions of SkyBonus points worth more than $1.75 million dollars.”

Prosecutors say that Podolsky earned and redeemed more than 42 million SkyMiles this way, which the airline valued at $1.75 million.

Podolskys conduct “was not fraudulent,” they said. “Indeed, while the government says Delta is a victim, the evidence at trial will show Delta actually netted millions of dollars of profits from its relationship with Mr. Podolsky. The suggestion that Mr. Podolskys conduct somehow disadvantaged his clients is equally unfounded.”

Podolsky, a dual Ukrainian and American citizen, has been relatively prolific in his role as a travel agent and advisor. In a 2016 profile in Wired, Podolsky said that he preferred to think of himself as a “creative manager.”

On Thursday, the 43-year-old owner of Chicago-based Vega International Travel Services was arraigned in Atlanta on charges of wire fraud after being indicted by a grand jury. He pleaded not guilty and will be permitted to await trial at his residence in Chicago, assistant U.S. attorney John Ghose said.

Podolsky could not be reached for comment on Friday, and Delta did not immediately return a request for comment.

One of those creative methods, federal prosecutors allege, was fraudulently gaming the Delta SkyBonus miles program to reap millions of points and book tickets on behalf of his firms clients, who prosecutors say are primarily individuals of Russian and Eastern European descent who were living abroad.