Can you get in trouble for buying to many giftcards?

[unfunkable]

Hi
Have you or do you know anyone who has got into trouble with AMEX for buying too many prepaid Visa cards?
Like 30k+ a month?
cheers

 

[Dr Ralph]

Nope.

But why would you do that?

 

[andye]

If anyone knows, shanye knows

 

[unfunkable]

Won't get in trouble for 'Manufactured spend" or anything? After my last run in with AMEX, don't want to do anything wrong...lol
What did this shayne person do? PM if you want

 

[andye]

I don't think I ever worked out exactly what he did but it was always to excess

 

[unfunkable]

Did he get in trouble? Cards cancelled?
I've heard stories of the 1 million MR points loophole, was that him?

 

[puppysparkes]

Hi
Have you or do you know anyone who has got into trouble with AMEX for buying too many prepaid Visa cards?
Like 30k+ a month?
cheers

At the last AFF catch-up in BNE I was told there are guys making 250K annually in LOTFAP. Apparently they're pushing the limits of the law. But for 30K my guess is you're good to go. Read the t&c's carefully would be the wise thing to do.

 

[moa999]

People churn 30 cards annually in LOFTAP

 

[prozerran]

mind my ignorance but what does LOFTAP stand for, and how do people make $250K

 

[moa999]

LOTFAP = USA = Land Of The Free And Paranoid

 

[mannej]

mind my ignorance but what does LOFTAP stand for, and how do people make $250K

Land of the free and paranoid - I.e the good old US of A

 

[unfunkable]

i know you can get busted for manufacturer spend ,but buying 30k +worth of cards to use at places that don't take Amex is ok right? Don't see anything in the terms and conditions about it.

 

[puppysparkes]

i know you can get busted for manufacturer spend ,but buying 30k +worth of cards to use at places that don't take Amex is ok right? Don't see anything in the terms and conditions about it.

What card are you thinking of using? Pm me if necessary

 

[lovetravellingoz]

Hi
Have you or do you know anyone who has got into trouble with AMEX for buying too many prepaid Visa cards?
Like 30k+ a month?
cheers

You might get flagged.

I know someone that was making millions of points from through buying the Westfield Cards on Amex. They contacted him and then closed the loophole. Westfield was actually supplying him with the cards at reduced wholesale rates and were none to happy to discover that the cards being bought were being use for manufactured spend rather than client giveaways.

The weight of people buying vpay at HN saw the way you can use it tightened and people on this forum were asked to verify their spend.


Amex and other CC providers are concerned about money laundering through cards etc.


Having said that as long as you can justify it all is cool. ie You see some large companies issuing cashbacks via say $200 VISA Cards. However if you are looking to use it for manufactured spend then you may eventually have to justify it.

The other day I bought $3000 of GC from Coles. After the first two $1000 lots the card was blocked and I was email and SMS=ed about possible fraudulent use. So yes Amex does monitor such purchases with software.

 

[Haplo]

If the gift card bought was eventually used for actual purchase (i.e. if you paid it with a credit card instead it would be treated as purchase) then I see nothing wrong with it. For example if you are purchasing the prepaid visa card and then use these visa card to purchase at shops that does not accept amex, then I can't see how that is breaching the prepaid visa terms and conditions.

Manufacture spend is definitely an area you don't want to get to as it is more or less fraudulent.

 

[Mal]

Depending on the type of card, Amex can cause issues. For Charge cards, they can flag you for a Financial Audit - which is a paperwork based assessment of income vs expenses, for normal cards, they can question your usage.

In the UK, I know of people who have been told that Amex no longer wants their business, and also flagged for audit.

In summary, they don't like you cashing out your credit limit into cash like items, as it puts them at risk if you default. However, in small amounts (even 30k a month is small), I doub't you'd see any issues.

 

[Isochronous]

The answer is yes. Amex has very sophisticated data monitoring software and the fraud team normally uses this to monitor potentially fraudulent spend. Not only that, but in my legal career I once represented a hedge fund guy who was running an MS scheme so successful that AUSTRAC and the AFP got involved, and he spent 6-9 months being investigated for money-laundering. It took them a while to eventually believe that it was being run solely for points and no other ulterior purpose.

The upside was that I made a lot of money in legal fees. And no I didn't accept payment in points - cash only.

 

[unfunkable]

It would be used for legitimate purchases - proveable by payment reciepts. Used at places that don't take Amex .
How about bank issued Amex - are they monitored as strictly ?

 

[Jezza8888]

isochronous, if he afforded your legal fees he must have been in some serious strife! how much was he turning over?

 

[moa999]

I once represented a hedge fund guy who was running an MS scheme so successful that AUSTRAC and the AFP got involved, and he spent 6-9 months being investigated for money-laundering..

Wonder how much of his, or his employers time, was being used on said pursuits