If nothing has been done incorrectly then a statutory declaration should sort it all out in a couple of weeks. I am thinking Velocity must be looking for people selling off points or status to third parties. Locking up family accounts for longer than 2 weeks would be harsh for travel warriors who fly so much.
Let's say you're arrested. It should be fine if you're innocent, right? In the meantime your life is put on hold, society judges you, your boss has pressure to fire you because you might be a criminal. But don't worry. You're innocent ...
I used to head up a large social network which had virtual currency/points, and we had people trying to defraud the system on a daily basis.
There's folks who straight up try to scam/hack the system, and they're
easy to catch. It's when you're not sure about an account that care needs to be taken. We had some members refer to the T&C, submitted ACMA or ACCC complaints and every so often an empty legal threat would arrive on our doorstep. Fraud is a very real issue for online businesses and if member accounts are displaying signs of unusual activity, steps need to be taken to ensure there's not 100 other accounts all ready to strike (as with Air India a few months ago).
Paypal is an excellent example of how not to restrict account access and make the user feel like they're a criminal, but this is only done because they have KYC and financial service requirements. Velocity does not have such legal requirements to my knowledge.
So, aside from the obvious commercial upside of ditching the whole 'family member' system which would turn the current cost center into a revenue stream for Velocity, the communication email could ask the member to fill in a family tree on their profile and provide FF# for each member. Reward the member with points for completing the task.
Setting the relationship status in stone means Velocity can match this against other accounts, and if any discrepancies then action can be swift and harsh. In fact, Velocity could easily amend their T&C today to allow points to be used on anyone outside your family with a 25% premium on the points cost. There's no shortage of ways this could be handled but one thing is clear - the current system sucks for everyone.
In addition to this, Velocity could require every award redemption pax be a Velocity member. This would strengthen the family relationship structure they're tracking across the entire database, and push more member signups as they're required for award tickets in the process.
Job done. Velocity, which address should I send the invoice to?