3 Get Prison for Frequent Flier Fraud

The owners and an employee of a Woodland Hills travel agency were sentenced to prison Tuesday for defrauding American Airlines of more than $1.3 million through a frequent flier program scheme, a spokesman for the U.S. attorney’s office said.

James Robert Winkleman, 35, of Agoura Hills, owner of the North Ranch Travel Agency, was sentenced to four years and fined $250,000. His partner, Philip Ross Rinker, 35, of Agoura Hills was sentenced to two years and fined $15,000.

Brenton Neil Mullins, 29, of Playa Del Rey, a company employee, was sentenced to 21 months and fined $5,000.

The men were convicted in October on several felony counts of conspiracy, mail fraud, wire fraud and use of fictitious names in a fraud.

The charges stemmed from their use of the travel agency’s computer to manipulate American Airlines flight records and obtain more than 564 tickets through the frequent flier program, Assistant U.S. Atty. Gary Lincenberg said.

Between June, 1986, and January, 1988, the three set up frequent flier accounts in fictitious names, then credited the fake accounts with miles flown by passengers who were not enrolled in the frequent flier program, Lincenberg said. They had access through the airline computer to the records of passengers who had purchased tickets directly from the airline, he said.

Shortly after a selected passenger’s flight was complete, the men changed the passenger’s name in the computer to one of the fictitious names they had chosen and credited the mileage to that account.

“They frequently looked at flights to Tokyo” because of the high mileage, Lincenberg said.

After accumulating enough miles, North Ranch employees applied for free flights under the bogus accounts and sold them, he said. They sold at least 564 tickets or coupons worth more than $1.3 million and “there was evidence that other tickets had been fraudulently obtained,” Lincenberg said, but because American Airlines destroyed the earlier tickets the exact loss to the company was unknown.

In 1988, an FBI investigation was conducted into the agency after an American Airlines employee noticed that the names of passengers on a computerized manifest for a flight that had not yet departed did not match the names of the actual passengers.