A hotel manager has been indicted for stealing $150,000, and concealing the theft by fraudulently redeeming guests’ hotel points.
- Guest would pay for their stay in cash
- She’d go in and redeem an award night against the stay from the guest’s loyalty account
- And then refund the cash to her own credit card
From March through at least October of 2023, Patterson manipulated the hotel’s reservation system and altered the records of customers who had paid using cash or credit cards, the indictment says. Patterson changed those reservations to falsely show that the customers had used the hotel’s loyalty rewards system “points” to pay for their stay. Patterson then added her own credit or debit card information into the system and had the customers’ payments “refunded” to her.
Patterson fraudulently refunded to herself a total of about $ 153,518 during the course of her scheme, the indictment says. On Oct. 4, 2023, although not on duty, Patterson tried to use the hotel’s desk computer and a coworker’s credentials to fraudulently refund herself an additional $61,998, the indictment says.
Eventually something like this is going to get caught. A guest will notice their balance has been decreased. Maybe one of them uses Award Wallet! Meanwhile she faces up to 20 years in prison and a $250,000 fine on each wire fraud charge.
This is a bit more clever than the Aria Las Vegas manager who made customer service refunds on customer rooms to his credit card. Although there the manager got caught by buying expensive things, unsupportable on his salary, and was turned in by his coworker-slash-boyfriend.
And it’s definitely smarter than the Hilton Garden Inn manager who would add charges to guest bills, and refund the charges to his credit card. There was almost no net expense to the hotel, but even a single guest complaint could call this out.
However, it’s hardly the first time that a hotel has booked fake award nights, as well. In fact, the Parker Meridien in New York (now Thompson Hotel Central Park) allegedly scammed Starwood Preferred Guest for over a million dollars by redeeming points for fake reservations to juke their occupancy stats and generate full average daily room rate reimbursements from the program.
I can’t even imagine how a personal n could get away with this scam for 48 hours? When points are redeemed, nearly every rewards program sends a confirmation email. Further, if you try to alter the email, a notice gets sent to the old and new email address.
This property would have to have very dumb and dazed customers.
Curious what hotel it was/which brand. Richmond Heights, MO is the area around the St Louis Galleria. There’s a Homewood Suites across the street and then a gaggle of various mid-tier Bonvoy brands (Courtyard, TownePlace, Springhill, etc). I doubt it was at a Drury Inn or Mainstay (Choice).
How does something not seem instantly amiss when a credit card charge is refunded to a DIFFERENT credit card? How is the hotel payment system even allowing that to happen?
@David P: On Marriott Bonvoy, I get emails when new reservations are created. I do *NOT* get emails that points were redeemed. I’d have to look at the reservation email to notice that the payment method was points instead of cash.
On top of that, Marriott sends me about 3x as many receipt emails as I need, and seeing the receipt requires downloading and opening a PDF of the folio, and I’m not going to download and open them all.
So if a hotel converted one of my reservations from cash to points, I would likely not notice unless (and I’m not even sure the reservation number would even change) I got lucky enough to notice the reservation number changed, or am in the habit of opening ALL the PDFs attached to the receipt emails and reviewing them, I’d never notice.
Oh, and don’t even get me started on if it’s a business booking where I have 8 rooms going at a time. I have to make make a spreadsheet with each confirmation and room number and audit that the total charges match the bookings and my credit card charges.
@Christopher: Exactly on the number of emails… and sometimes I will stay at 3 different hotels in a week and continue to get receipts days later. But I will say with Hilton I’ve gotten emails when redeeming points and that’s how I caught fraud once. But the idiot had put the room in their own name and home address but neglected to change my email address and phone number. And they did it in a small town on a weeknight where the local police were looking for something to do and were all too excited when I called them up.
You bring up an excellent point about refunding to a card that was not originally the form of payment. In my airline days, we locked down (to comply with payment card privacy) so that agents and supervisors could only see the last 4, type of card, and the expiration date. They could only refund back to a form of payment that was in the reservation, and only up to the amount originally charged to that card (I guess if you used 3 different cards for $50 each and had a $15 refund of a fee it could go to a different card, but still one used on the record). As a manager I could see the full number but still couldn’t refund to something else.. that was primarily so I could investigate things for corp security. Anything outside of a payment method already used on the record had to get queued to corporate refund dept and they’d send a check.
It’s a little alarming that hotels don’t have this locked down as well. And also that there isn’t some sort of flag on amount of refunds coming out of a property. $150k is about 750 nights using an average rate that’s about right for a mid-tier business hotel in suburban St. Louis. You’d think that’d flag something… but maybe in the world of franchises nobody cares beyond the franchisee and this franchisee is asleep at the wheel. I have a friend who “made it big” owning about 4 dozen Pizza Hut and McDonalds locations. He was all over the books for each and if a store refunded $100 in a day he wanted to know why. For a hotel $100 is nothing but $150k over a year? Or up to $60k in one hit?
Yeah I don’t understand the facts
Hotel manager redeemed the guest’s points… and it took $150k of rooms until this was found out?
Remember as a guest: it’s not just noticing that your points are gone. That might take me a while as I am not always on top of whether I have exactly 259,834 points or 229,834 points. But I always check the folio and I would notice I didn’t earn any points because it all of a sudden became an award stay.
As noted earlier, hotels that charge a credit card fee are just asking for trouble. Cash always has a way of disappearing.
Where’s all this AI that would detect something like this!!
Too busy milking customers with extra hotel fees!!
There are many dishonest people. Many business owner has mind set of “Cash is King” and inviting nothing but troubles.
This individual is clever but at end of day thieves… and rat