American Express has abruptly closed a previously exploited loophole in its Delta co-branded cards, now reversing statement credits for cardholders who cancel prepaid hotel or vacation rental bookings made through the Delta portal. The move effectively prevents users from turning these credits into cash.
The Former Loophole and Its Abuse
Delta American Express cards offer statement credits ranging from $100 to $250 for eligible hotel bookings. Until recently, users could exploit the system by booking stays, receiving the credit, then canceling the reservation. Because Amex didn’t immediately reverse the credit upon cancellation, cardholders effectively pocketed the benefit as cash. This workaround allowed users to extract value without actually incurring the hotel expense.
The New Enforcement Mechanism
Starting around January 29, American Express began reversing these credits when cancellations were processed. The change mirrors the behavior of Amex Platinum’s Fine Hotels & Resorts credit, where refunds trigger credit reversals. Amex now tracks eligible spending against issued credits, reducing the amount when a refund posts to ensure the credit aligns with actual spend. This includes factoring in bookings made in prior years that roll over into the current year.
Clawback Examples and Variations
One Delta Business Gold cardholder, for instance, booked a $180 room on January 29, received a $150 credit on February 1, and subsequently had $135 reclaimed after refunding the booking. This reduction of $15 was due to prior year’s leftover spend, demonstrating the system’s granular tracking. Credit reversal timelines also vary, with some reversals happening on the same day as the refund and others taking longer.
Implications for Card Value
The change impacts the economic value of Delta cards for those who previously abused the loophole, potentially making higher-fee cards less justifiable. The Delta Stays perk still offers a broader range of properties than premium hotel booking credits like Fine Hotels & Resorts, though often without loyalty benefits. The move also raises questions about whether Amex will tighten similar clawback logic for other credit perks, such as the Hilton Aspire resort credit.
American Express’s enforcement of the Delta Stays credit policy demonstrates a broader trend of cracking down on loopholes in rewards programs. This aligns with the company’s efforts to minimize unintended benefits and maintain profitability.
The shift is a clear signal that Amex is actively monitoring and adjusting its rewards programs to prevent abuse and ensure credits align with actual spending.
