Podcast: The Truth About the Market
Host: Jason Zilberbrand, President of VREF
What Really Happens to Your Money When You Buy a Jet Card
Last episode was about escrow.
Why no rational aircraft buyer wires eight figures directly to a seller. Why a neutral third party holds the money. Why structure matters more than trust.
Then Jason asks an uncomfortable question:
Why will many of those same sophisticated buyers wire $250,000, $500,000, even $1 million directly to a jet-card company—with no escrow, no collateral, no financial statements, and no requirement that the money remain untouched?
Because the industry calls it a deposit.
Jason calls it something else:
An unsecured, interest-free loan to a private company.
That distinction is the heart of Episode 58 of The Truth About the Aviation Market.
This is not an argument that jet cards are scams. Jason is explicit about that. For the right traveler, a jet card can solve a real problem and reputable providers deliver exactly what they promise.
The question is:
What happens to your money between the day you wire it and the day you fly?
And how much do you actually know about the company holding it?
In this episode:
- Why Jason argues that a prepaid jet-card balance should be analyzed like a loan, not a bank deposit
- How the jet-card model began with Marquis Jet selling 25-hour access to the NetJets fleet
- The critical difference between reselling access to a well-capitalized fleet and selling fixed-price promises without owning aircraft
- Why NetJets’ decision to stop or restrict jet-card sales during periods of extreme demand matters
- What Jason believes it tells us when a provider with aircraft, pilots, and deep capitalization deliberately refuses to sell more promises than its fleet can support
- Why a broker with no aircraft may never encounter that same physical limit
- What current jet-card pricing looks like across light, midsize, super-mid, large-cabin, and ultra-long-range categories, using the market figures Jason cites in the episode
- Why peak-day restrictions, daily minimums, and callout times have expanded since the pre-pandemic market
- How the economics work when a broker sells you a fixed hourly rate but has to purchase your aircraft in a floating charter market
- Why a profitable spread on an ordinary Tuesday can become a loss during Christmas, spring break, the Super Bowl, or another peak period
- The financial danger Jason sees when new customer deposits become the source of liquidity supporting old customer promises
- Why 100 customers depositing roughly $210,000 each can leave a broker holding more than $20 million of customer cash
- The three very different places that money can sit—and why buyers frequently confuse them
Escrow, segregation, or operating cash?
Jason breaks jet-card balances into three basic structures.
1. True escrow
Your money is held by a third party and cannot simply be spent by the jet-card company whenever it wants.
Jason says this is rare, may cost extra, and often has to be specifically requested.
2. Segregated account
The money is separated from ordinary operating cash.
But the company can still move it.
Jason’s point:
Segregated is not the same thing as escrow.
It is only as strong as the controls and people governing the account.
3. Operating account
Your wire becomes working capital.
Payroll.
Fuel.
Rent.
Aircraft acquisition.
Charter lift.
Whatever the company needs to pay.
And according to Jason, this is where much of the market operates.
That creates the central asymmetry of the episode:
The flight is heavily regulated.
The money funding the flight may not be.
The flight is regulated. The deposit isn’t.
Jason walks through the distinction between FAA/DOT oversight of charter operations and the financial treatment of prepaid customer balances.
The operator flying the aircraft must comply with Part 135.
Pilots are certificated.
Maintenance is regulated.
Brokers operating under Part 295 have disclosure obligations.
But Jason argues that those protections do not create the equivalent of a bank regulator watching your prepaid balance.
There is no universal capital requirement.
No universal escrow requirement.
No universal deposit insurance.
No public balance sheet for most private providers.
And no guarantee that a refund obligation means the cash to satisfy that refund is actually sitting somewhere waiting for you.
The JetSuite warning
Jason uses the 2020 JetSuite bankruptcy as the episode’s most concrete cautionary example.
According to the reporting he cites, roughly 1,000 jet-card members had approximately $50 million in deposits at risk when the company entered Chapter 11 and grounded its fleet.
Jason emphasizes that JetSuite was not some anonymous website.
It was a recognizable aviation company.
It operated aircraft.
It had history.
People trusted the name.
And that is precisely why the lesson matters.
His point is not that JetSuite was necessarily acting fraudulently.
The pandemic devastated aviation companies.
His point is that from the customer’s perspective, fraud and business failure can produce the same result if the money is gone.
The structure determines what happens next.
Trust the structure, not the name.
The hidden-column problem
Jason then asks a basic question:
Where can consumers actually find out which jet-card providers offer escrow protection?
He points to Doug Gollan’s Private Jet Card Comparisons, which Jason describes as the industry’s primary independent consumer comparison source.
The figure Jason cites is striking:
At the time of one analysis, only 19 out of more than 500 programs tracked offered an escrow option—and even then, often only upon request.
Jason’s frustration is not directed at the comparison service.
Quite the opposite.
His criticism is that one of the most financially important pieces of information in the transaction can be buried deep inside a comparison spreadsheet rather than being prominently disclosed by the market itself.
Whether the company can spend your money the moment you wire it should not be a footnote.
Jason believes it should be one of the first questions asked.
The websites all look the same
A major portion of the episode examines aircraft-charter brokers that own no airplanes.
Jason argues that from the outside, many are almost impossible to distinguish from actual aircraft operators.
The same aircraft photography.
The same “our fleet” language.
The same safety logos.
The same promises of guaranteed availability.
The same headline pricing.
The same family walking up the airstairs at sunset.
But an aircraft charter broker and a direct air carrier are not the same thing.
The broker may not:
Own the airplane.
Employ the pilots.
Maintain the aircraft.
Hold the Part 135 certificate.
Or even know exactly which aircraft will operate your trip until the flight is sourced.
Jason highlights the Part 295 requirement that brokers disclose that they are brokers rather than direct carriers.
His question is whether technically placing that disclosure in small footer text provides the transparency customers think they’re getting from the rest of the page.
“Our fleet” — when there is no fleet
Jason zeroes in on one phrase in particular:
“Our fleet.”
If the company is a broker that owns no aircraft, whose fleet are you actually looking at?
The aircraft may belong to multiple independent Part 135 operators whose lift the broker purchases as needed.
The operator can change.
The aircraft can change.
The maintenance history can change.
The company flying you can change.
Yet the website can create the impression of a unified fleet.
Jason’s advice is simple:
Ask who will actually operate your flight before you sign the contract.
Not afterward.
The empty-leg trap
Jason then goes one rung further down the market into empty-leg memberships and prepaid flight-credit programs.
An empty leg is real.
When an operator flies one customer somewhere and needs to reposition the aircraft, it may sell that otherwise-empty repositioning flight at a discount.
The problem is reliability.
The empty leg only exists because another trip created it.
If the original customer’s schedule changes, your opportunity may disappear.
Jason distinguishes between opportunistically buying an actual empty leg and paying membership fees or prepaying credits for access to an inventory the reseller does not own or control.
His description is blunt:
You didn’t charter an airplane. You bought a maybe.
Nine red flags before you wire
Jason gives listeners a practical list of warning signs. No single one necessarily proves there’s a problem, but multiple red flags together should slow the buyer down:
- The advertised rate is materially below the market for that aircraft category.
- “No blackout dates” from a provider with no aircraft.
- An “our fleet” page from a company whose legal disclosure identifies it as a broker.
- The company won’t identify the actual operators before contracting.
- A vague answer to: “Where does my deposit sit?”
- A significant discount for wiring a larger deposit.
- The legal entity on the contract does not match the company consumers think they are dealing with.
- Artificial urgency around wiring money or locking in a rate.
- Membership fees or prepaid credits for empty-leg inventory the company doesn’t control.
His point isn’t that each one proves misconduct.
It’s that you should understand the economics before giving anyone six figures of unsecured cash.
Six things Jason would check before sending $1
Jason then lays out a due-diligence process he says can largely be completed in an afternoon.
1. Check the legal entity
Search the appropriate Secretary of State database.
Confirm:
Formation date.
Current status.
The actual entity named in your agreement.
Then check UCC filings.
Jason’s concern is simple: if another lender has a blanket lien over the company’s assets, where does your unsecured deposit stand if something goes wrong?
2. Verify the operator
Ask for the names and certificate information of the Part 135 operators actually flying customers.
Then verify those operators directly rather than relying solely on badges displayed on the broker’s website.
3. Verify where the money sits
Ask for bank confirmation of the account structure.
Not simply a letter from the broker saying the money is protected.
Ask what is required to move funds out of the account.
4. Search the company and its principals
Jason recommends looking beyond the current LLC.
Who are the people behind it?
Where did they work before?
What happened to their previous companies?
Have disputes with operators or other creditors appeared in the public record?
5. Keep your exposure small
If you still want the card, Jason recommends starting with the smallest block and shortest term that works.
And if the provider accepts credit cards, he views the transaction fee as potentially worthwhile because chargeback rights can provide protection a wire does not.
6. Get the critical answers in writing
Where does my money sit?
Will the bank confirm it?
Do you own the aircraft or broker them?
Who actually operates the flights?
What happens to my balance if your company fails?
What are the peak-day surcharges, minimums, restrictions, and expiration terms?
Good providers, Jason says, should have boring answers.
Why Jason thinks the risk may be increasing
The uncomfortable part of the episode is that Jason believes current market conditions make the structure more—not less—important.
Demand is strong.
Flight activity is elevated.
Aircraft supply is finite.
Pilots are expensive.
Factory deliveries take time.
Wholesale charter pricing can become volatile during peak periods.
At the same time, consumers want fixed-price guaranteed availability.
Those economics can squeeze the intermediary sitting between the customer and the aircraft.
Jason interprets increasing peak-day restrictions, longer callouts, and tighter terms as evidence of the market attempting to ration increasingly expensive capacity.
His warning is about what happens if contract restrictions can no longer absorb the pressure.
The temptation is to let new deposits cover current obligations.
That works until inflows slow.
Then it can stop working very quickly.
What Jason would do instead
Jason’s preferred solution is surprisingly simple:
Go directly to the operator.
Find the Part 135 company at or near your home airport.
Walk into the hangar.
Meet the people.
See the airplanes.
Look up the tail numbers.
Verify the operating certificate.
Talk to the director of operations.
Talk to the chief pilot.
Talk to maintenance.
Many operators will sell blocks of hours directly.
Some may establish preferred pricing for regular charter customers without requiring a large prepaid balance.
The trade-off is less theoretical access to thousands of aircraft.
But in exchange, you know who actually owns or controls the lift.
You know who employs the pilots.
You know who maintains the aircraft.
And you can see the operation with your own eyes.
Jason would rather pay a transparent floating price to a company he can inspect than rely on a fixed-price promise from a balance sheet he cannot.
The bottom line
Jason’s conclusion is not:
Jet cards are bad.
It’s:
Jet cards can be a good product wrapped around a financial structure most consumers would never accept anywhere else.
Guaranteed lift at a known rate has real value.
But if you prepay hundreds of thousands of dollars to a private company and that company can spend your money immediately, you are taking counterparty risk whether the brochure uses the word “loan” or not.
The company that invented the modern jet-card product has repeatedly been willing to stop selling when it believes its fleet cannot support more promises.
Jason wants buyers to think carefully about what it means when a company with no fleet at all never seems to reach that limit.
Before you wire:
Ask where the money is.
Ask who controls it.
Ask who flies you.
Ask what happens if the company disappears.
And get the answers in writing.
Because:
The market doesn’t care what the brochure called it.
It only cares where the money is.
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VREF it before you make the call.
The market doesn’t care what you wired. It only cares what got filed.
Fly safe. Stay smart.
