Asset Protection: Frequent Flyer/Hotel Points

The opening sequence to the film “Wedding Crashers” has a divorce attorney proceeding discussing splitting of frequent flyer miles as an asset. I am not sure if this is realistic, since even though FF have a value, they cannot be resold on the open market due to terms and conditions of most programs. It would be like virtual currency in an online video game. It has value and people do buy/sell them, but they violate the TOS and accounts can be banned for doing so if caught.

With respect to creditors, has there been any cases where a creditor has gone after someone for their FF points? And if so, how does the credit expect to get “paid” if the program doesn’t allow transfers?

I love the asset protection idea of “own nothing, control everything” and I wonder if FF points can be one small piece of that strategy. I know many “road warriors” that travel professionally for years and have saved up 1M+ points. It could be possible to have enough points to do 2 or 3 domestic trips per year, until you die, depending on how much the points values are susceptible to inflationary pressures over time.

If these are an asset that cannot be seized, I find it interesting to have enough FF points for hotels and airlines that would let you do 1 to 2 vacations for free every year until you die.


God, I missed you TripleB


Wouldn’t this require investigation into said accounts? Can rewards accounts be subpoenaed - precedent set on this?

Sure - there is value to a broker, but what about a spouse that does not travel?

Definitely an interesting conversation. I travel for work frequently and have quite a bit in specific programs.

This is a really great topic because it affects so many things.

The short answer is that FF accounts can be split in a divorce. Some programs specifically disallow the transfer pursuant to divorce, others charge fees to move points over, etc. From what I’ve read, the most common way to “split” the points is assigning some value to them and one side just paying cash to keep the whole account (this avoids the fees the programs would charge). Of course, as you pointed out, valuation is problematic. Since I don’t know about divorce law, I’m not sure how you would value them. If I was an attorney for the person who didn’t own the miles, I would try to value them at the price the company sells miles for. If I was the owner, I would try to value them at the price you could turn them into cash for (pursuant to the program’s rules) - such as using them to purchase a gift card, then selling that gift card to a card broker. I would imagine the actual valuation lies somewhere in the middle.

I like the idea of using them for asset protection, and I’m not sure if they’d be protected from seizure in various legal scenarios. The problem, though, is that the points generally decline in value over time, and since it can be hard to use 1M miles within the limited notification period the airline/hotel gives you before devaluation takes effect, there’s a substantial risk you can’t avoid the devaluation on points you currently have.


This reminds me how a few years ago when my father in law passed away, I called the airline to figure out how to transfer his miles to his wife. The clerk very nicely explained that the cost of doing so is so exorbitant compared to his number of miles it is not worth it. He “recommended” that we don’t notify the airline about him being deceased and simply use the as if he were alive.

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I got pulled into this for a friend who was going through a divorce. This is exactly what happened, a push-pull type negotiation of the value as part of the overall splitting of assets/debts. I gave him my personal feeling of their value but don’t know what ended up happening aside from he kept the points.

It seems like a divorce can force splitting of points. How about a non-divorce scenario such as unpaid medical bills or other creditor type scenario where there is a large outstanding judgement against you and limited assets from which to seize?

I did specifically list all miles/points in my will, since they’re a non-trivial asset. I wouldn’t really deliberately stockpile them as an asset protection strategy though, since they depreciate so quickly. It wouldn’t take many years at 5-10% loss to catch up with losing 50% in a divorce.

What would be more interesting is how they’re treated in a bankruptcy. Could you really file BK with 10-20 million miles and 1 MM assets in an ira and still wipeout a ton of unsecured debt?

The questions I have are:

  1. Is it possible for the plaintiff’s attorney to demand airlines hand over their FF point data similar to how they can request information at banks, given appropriate court order.

  2. Is it a question asked at a debtor’s exam?

  3. Has there ever been a historical precedent for a creditor to attempt to seize, or actually seize FF miles.

Given the little I’ve read about asset protection and how effective simply obfuscating your assets can be, I suspect a plaintiff’s attorney would not go through the effort of demanding personal information on me from 10 to 20 of the common FF/Hotel programs in the US. Especially given the low yield if they find anything.

The more interesting case is for transferable point programs like SPG, Chase Ultimate Rewards, Citi ThankYou, Amex MR, etc. If I seriously injured someone in a car crash (beyond my $100,000 insurance limits), should I be MSing into UR points? UR points have a fixed value of a penny a point as cash, but are worth far more in airline or hotel miles.

One of the big travel bloggers, Million Mile Secrets (Daraius and Emily) recently got divorced (Daraius was found on the Ashley Madison email dump list twice). Both had accumulated tons of miles but my feeling was that it was done on a more or less equal basis after the marriage, with many miles consumed during and prior.

[quote=“TripleB, post:10, topic:574, full:true”]

The questions I have are:

  1. Is it possible for the plaintiff’s attorney to demand airlines hand over their FF point data similar to how they can request information at banks, given appropriate court order.

  2. Is it a question asked at a debtor’s exam?

  3. Has there ever been a historical precedent for a creditor to attempt to seize, or actually seize FF miles.[/quote]

For 1) This may depend on the state and possibly even the particular court, but as of about a year ago, frequent flyer information was definitely discoverable in at least two jurisdictions. It’s not public whether this was challenged though, so maybe if you challenged the subpoena, a judge would say it’s not discoverable. If I recall though, these were not bankruptcy cases, so the type of case may matter as well. Sorry for the non-definitive/heavily qualified response, but perhaps someone more knowledgeable about discovery is bold enough to be more concrete.

Not sure what a debtor’s exam is or whether a creditor has attempted to or actually seized FF miles.

Wow. Learn something new every day.

Perhaps they’ll post a spoon feed with circles and arrows on how to do a cheap DIY divorce.


Yeah, didn’t know about the AM list.

During divorce proceedings, you will be required to disclose all of your assets voluntarily, meaning anything of value. In California, if you fail to disclose a community property asset that is later discovered, you forfeit 100% of the concealed asset. See CA Family Code Sec. 2556. I could research further, but I am all but certain that there are cases right on point that say that miles have a tangible value.


The AM thing is so confusing since the evidence says the site was scamming men by creating fake bot women to strung men along. Being on this list doesnt equate to saying anyone cheated.

On the other hand it used his real birth date and location he was living in, from my understanding. I’m sure the fact that he was on Ashley Madison was used in addition to other evidence, and not by itself. Remember towards the end he also went by himself to some ranch to get solitude in a last ditch effort to save the marriage.

that’s why you keep things offshore and under your parents’ names.

bottom line, if they can take oj simpson’s heisman trophy, they can take your miles too

But what if your parents get sued?