Imagine you were given the privilege of having a lifetime pass to travel anywhere in the world – I’m sure you’d be pretty stoked.
However, one man discovered that those same privileges could be easily taken away if you abuse them.
In 1981, American Airlines was looking for ways to increase business, and one way to do this was to offer anyone who was willing to pay them around $250,000 on the spot a free lifetime first-class ticket with the airline.
(The cost of the ticket would often vary depending on the age of the passenger, and by 1993, an AAirPass would set you back around $1.1 million)
And it was exactly as it sounded – the airline would provide the passenger with unlimited first class flights for life.
Initially, their plan was a success, and the airline managed to sign up a total of 66 people to what they referred to as the AAirpass.
However, what seemed to initially be a good plan turned out to be one of the worst financial mistakes they ever could have made, and it’s all because of one man called Steven Rothstein.
Rothstein purchased the AAirpass six years after it was introduced, at the age of 37, and spent the next two decades traveling first class to a number of destinations and of course, using all the other perks that came with the upgraded seat.
(Rothstein also purchased a $150,000 ‘companion pass’ with his lifetime first-class ticket, allowing him to take one more person with him on any flight.)
Steven Rothstein !
By 2008, Rothstein had traveled 30 million miles across 10,000 flights with American Airlines – for free of course – which started to add up.
And if you’re in any doubt as to how much of an impact it had on the airline, let’s just say the entire AAirpass program became virtually profitless thanks to this one man’s travels.
It clearly took the airline a little while to figure out the numbers but when their so-called ‘revenue integrity team’ eventually did in 2008, they decided to cut Rothstein off immediately.
According to History of Yesterday, all of Rothstein’s flights totalled estimated price of $21,000,000 – around eighty-four times what he had initially paid for the AAirpass.
The avid traveler even became stranded in Bosnia as a result – yikes!
Not only that, but they also decided to take legal action against the broker for fraud, accusing him of lending out his tickets to others and booking flights with no intention of turning up.
The airline managed to settle the dispute with Rothstein outside of court as he admitted to some of his crimes, including giving his ticket to others to use.
“I gave a man in Seattle a ticket to go to his father’s funeral. I gave many people tickets to visit ill family members,” he told Forbes in 2019. “I don’t view that as philanthropy, I view that as good deeds.”
Writing for The Guardian, Rothstein’s daughter – Caroline – said: “Dad does admit he booked seats he wasn’t sure that he, or his companions, would ultimately use. But that’s not an uncommon practice, and he never understood it to be against the rules. His understanding was that fraudulent behavior was limited to giving the AAirpass to someone else – which he never did.”
Rothstein told his daughter: “I never booked my own reservation on a computer. I never knew how to do this. So every single one of the reservations they didn’t like was booked and/or changed by an American employee.”
