If you’re in prison, you may not lose your frequent flier miles

Errol Segal of L.A. lost the 346,000 miles he had earned on United Airlines because of account inactivity while he was serving time for fraud. If he’d only contacted the airline earlier, he might still have them.

When it comes to airline miles, the rule is pretty clear: Use ‘em or lose ‘em.

But what if you can’t travel because of circumstances beyond your control?

“What if you’re in the hospital in a coma?” asked Los Angeles resident Errol Segal. “What if you’re a soldier in Iraq? You couldn’t use your miles in those situations.”

Segal, 65, likens his plight to the above examples. But in fact it’s a bit different.

He had been head of an L.A. scrap metal company. In 2006, Segal pleaded guilty to recycling fraud and was sentenced to 41 months in federal prison.

His company paid people to transport bottles and cans from neighboring states and Mexico to storage yards in L.A., according to the 72-count indictment against Segal and eight other defendants.

The company told the state of California that it had purchased the recyclables locally and was awarded $2.5 million in refunds. The state offers refunds for bottles and cans, but only for those from inside the state.

Segal was also charged with falsifying reports and receiving $635,000 in refunds for bottles and cans that never existed.

He told me he didn’t want to get into the whys and wherefores of his case.

“It’s very emotional,” he said. “To go to prison is not a pleasure.”

Be that as it may, Segal said he has paid his debt to society. He served 31 months at the minimum-security Taft Correctional Institution in Kern County, followed by a few months in a halfway house and then a few more under home confinement.

And after becoming a free man once again, he was ready for a little vacation. But lo and behold, the more than 346,000 miles previously accrued on his United Airlines Mileage Plus account were gone.

There’s a good reason for this.

“Miles will expire if you don’t earn or redeem them at least once every 18 months,” said Sarah Massier, a United spokeswoman.

The rules are spelled out clearly in the terms and conditions for the Mileage Plus program: “Any member who fails at any time to engage in account activity for a period of 18 consecutive months is subject to termination of his or her membership and forfeiture of all accrued mileage as of the last day of the 18th month.”

In Segal’s case, that means the miles went bye-bye in June 2008 as he languished in prison. Of course, travel wasn’t much of an option during this time.

“I was between a rock and a hard place,” Segal said. “What could I do?”

The first answer that comes to mind is to not have defrauded California taxpayers with a bogus recycling scheme.

But it turns out that prison isn’t a death sentence for airline miles. Massier said the airline’s policy is to work with anyone who contacts the company within a year of miles being forfeited.

That includes convicted felons.

“We’ll work with anyone on a case-by-case basis,” she said. “You just have to contact us within 12 months of your miles expiring.”

Segal didn’t do that. For that reason, Massier said, his miles are gone.

As for members of the military, she said United routinely places their miles on hold during overseas deployments. And she said she couldn’t think of any examples of people reclaiming miles after being in a coma, but there would probably be some wiggle room there as well.

So the main problem for Segal was that he didn’t use his miles as required under the terms of his contract, and then he didn’t contact United within a year of losing them as required by company policy.

Massier said Segal was notified of this before his miles expired.

“I was in prison,” he responded. “I wasn’t getting any mail from them.”

True, but didn’t Segal’s wife receive the notices?

“She says they never came.”

I sympathize with Segal’s situation, but it seems as if he’s out of luck. United made its rules plain enough and apparently met all its obligations. Segal did not.

But at least now we all know that miles can be reinstated even after the use-’em-or-lose-’em window has closed — and even if your extenuating circumstance happens to be a stretch behind bars.

I can just picture white-collar criminals throughout the country breathing a sigh of relief.

David Lazarus is a columnist with the Los Angeles Times, a Tribune Publishing newspaper.