If this is your first visit, be sure to check out the FAQ by clicking the link above. You may have to register before you can post: click the register link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. |
|
|
Thread Tools | Display Modes |
#1
|
|||
|
|||
Earning frequent flyer miles - is this cheating???
I have a Visa debit card with my bank in partnership with a major US
airline. I get one FF mile for every one dollar I spend using the card. I was thinking I could earn a ton of miles by doing this... I deposit $5,000 (or any dollar amount) into my checking account that the debit card is attached to. I own my own business and have a credit card machine/merchant account. I then slide my debit card in the terminal at my office, enter my PIN #, and charge the debit card $5,000. The merchant bank charges me a flat $0.50 fee for the transaction. The $5,000 is deducted from my personal checking account the card is attached to and is transferred into my business bank account. So I'm essentially running money in circles. BUT, I will get 5,000 frequent flyer miles with the airline for the transaction. Would this be considered fraud? You could rack up a ton of miles doing this and it costs basically nothing. |
#2
|
|||
|
|||
Earning frequent flyer miles - is this cheating???
In message . com
" wrote: I have a Visa debit card with my bank in partnership with a major US airline. I get one FF mile for every one dollar I spend using the card. I was thinking I could earn a ton of miles by doing this... I deposit $5,000 (or any dollar amount) into my checking account that the debit card is attached to. I own my own business and have a credit card machine/merchant account. I then slide my debit card in the terminal at my office, enter my PIN #, and charge the debit card $5,000. The merchant bank charges me a flat $0.50 fee for the transaction. The $5,000 is deducted from my personal checking account the card is attached to and is transferred into my business bank account. So I'm essentially running money in circles. BUT, I will get 5,000 frequent flyer miles with the airline for the transaction. Would this be considered fraud? You could rack up a ton of miles doing this and it costs basically nothing. Read your merchant agreements, and also contact your accountant to see what sort of tax you'll end up paying as a result of the additional income. -- You can get more with a kind word and a 2x4 than just a kind word. |
#3
|
|||
|
|||
Earning frequent flyer miles - is this cheating???
I then slide my debit card in the terminal at my office, enter my
PIN #, and charge the debit card $5,000. I think you'll find that you only get miles for signature transactions, not PIN transactions. If you want to pay your bank 2.5% or whatever your credit card discount is for miles, that would be fine with them. Some years ago, the AAA let members buy traveler's checks at par (that is, no fee) and charge them to your credit card. A bright fellow in Colorado got five frequent flyer credit cards and every month went to his AAA office and bought $100,000 in TC's. Then at the end of the month, he'd pay off each bill and repeat. The credit card companies finally changed the rules to treat TC's as cash advances, but not until he'd racked up several million FF miles. As I recall, he put the money in the bank between the time he bought the TCs and paid off the cards, so he made a few hundred bucks in interest, too. But that doesn't work any more. |
#4
|
|||
|
|||
Earning frequent flyer miles - is this cheating???
In article , John L wrote:
Some years ago, the AAA let members buy traveler's checks at par (that is, no fee) and charge them to your credit card. A bright fellow in Colorado got five frequent flyer credit cards and every month went to his AAA office and bought $100,000 in TC's. Then at the end of the month, he'd pay off each bill and repeat. The credit card companies finally changed the rules to treat TC's as cash advances, but not until he'd racked up several million FF miles. AAA was the one losing on the deal; they were paying the merchant fee. In my area, AAA changed its rules first: they stopped allowing free travellers' checks to be charged to credit cards in general, but continued to allow it for their own house-branded credit card. That blocked the FF mile collectors. It wasn't exactly as easy as your post makes it sound. AAA didn't have high-denomination TChecks, so it took around 30-45 minutes to do the paperwork on the transaction when buying them, including the initial signatures, and another 15-30 minutes to deposit them to a bank account, including the matching signatures. There were also federal currency reporting rules that had to be followed precisely, or a US frequent flyer might find himself in a Federal penitentiary on charges of structuring transactions and/or money laundering. (Those same laws were why AAA limited customers to $10,000 of TChecks per day). -- Randy Hudson |
#5
|
|||
|
|||
Earning frequent flyer miles - is this cheating???
|
#6
|
|||
|
|||
Earning frequent flyer miles - is this cheating???
|
Thread Tools | |
Display Modes | |
|
|
Similar Threads | ||||
Thread | Thread Starter | Forum | Replies | Last Post |
Frequent flyer miles | KpuTu4eH | Europe | 6 | May 10th, 2006 07:22 PM |
Frequent Flyer Miles Question | TomCAt | Air travel | 36 | January 11th, 2005 12:49 PM |
Frequent Flyer Miles Question | TomCAt | Travel - anything else not covered | 0 | January 8th, 2005 06:20 PM |
use of frequent flyer miles | Liz D. | Air travel | 2 | October 27th, 2004 09:11 AM |
1st experience using frequent flyer miles (UA) | NoNameAtAll | Europe | 5 | June 27th, 2004 05:05 PM |