There are the obvious risks of trying to game the credit card rewards system. You could mess up your calculations for earning signup bonuses and end up in debt. Your credit score could take a hit. Your points could be devalued or the card’s partners could get switched up.
But those are mistakes. There’s another risk that’s not as innocent: rewards abuse.
Customers have reported that American Airlines and Citigroup have been locking accounts and canceling flights of customers who have violated AAdvantage program policies.
Here’s an example of such behavior, from a Bloomberg report:
One issue is a practice that’s long been prohibited: opening numerous accounts with American’s loyalty program, AAdvantage, using a fake name and email address, then accepting a subsequent offer from Citigroup to apply for the airline’s credit card. Those online promotions often come with generous rewards of as many as 70,000 miles.
A post at The Points Guy indicated a recent promotional mailer may have been a factor. The mailer didn’t have the usual signup restriction that blocks current Citi cardholders from getting a signup bonus if they’ve opened a card in the past four years. And since signup bonuses are honestly the most attractive thing about most rewards credit cards, people opened a new card for the points. The offer also apparently lacked redemption restrictions, allowing users to share their promotional offer with others.
American and Citigroup both told Bloomberg they haven’t changed their policies and are always on the lookout for violations.
If you have one or two rewards credit cards, it’s highly unlikely you’ll be suspected of violating your credit card or airline’s rewards program. But the more you try to, shall we say, hack the system, the greater your risk becomes. Gary Guthrie at ConsumerAffairs writes that futzing with targeted links to get the same offer, using an offer that was intended for someone else, and trying to open a lot of cards in a short period of time are big red flags for card issuers. Opening a fake business? Yeah, that could come back to bite you.
If you’re thinking of getting a(nother) rewards card, consider your options carefully for your needs, time your application for a period when you’ll be able to spend enough to hit the minimum for getting your signup bonus, and by all means, follow the rules. You may not be flying first class any time soon with your pile of points, but at least you won’t risk getting them all taken away.
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December 24, 2019 at 02:30AM
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Are You Committing 'Rewards Abuse' With Your Airline Credit Card? - Lifehacker Australia
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