Amex fires another shot in their war on gaming

Yesterday Miles Per Day and Doctor of Credit reported a new development in the Amex War on Gaming.  The Amex Rewards Abuse Team (RAT team) has been sending emails to some people who recently earned signup bonuses via means that may be against the signup bonus terms (e.g. buying gift cards or buying and returning items).  According to Miles Per Day, one such email included the following:

We are writing to let you know that, unfortunately, you are not eligible to receive the Welcome Bonus for the Platinum Delta SkyMiles® Credit Card from American Express.

Activity on your account indicates an effort to reach the Welcome Bonus spend requirement in a manner that is not consistent with the terms of your Cardmember Agreement.

At this point it is unclear if Amex will really claw back the miles that were already awarded.  I’m sure they would do so if this happens with their own Membership Rewards cards, but it is less clear what they’ll do when miles or hotel points have already been deposited into a partner loyalty program such as Delta, Hilton, or SPG.

As a reminder, Amex signup offers now include terms like these (the exact wording may vary from card to card):

If we in our sole discretion determine that you have engaged in abuse, misuse, or gaming in connection with the welcome bonus offer in any way or that you intend to do so (for example, if you applied for one or more cards to obtain a welcome bonus offer(s) that we did not intend for you; if you cancel or downgrade your account within 12 months after acquiring it; or if you cancel or return purchases you made to meet the Threshold Amount), we may not credit the welcome bonus to, we may freeze the welcome bonus credited to, or we may take away the welcome bonus from your account. We may also cancel this Card account and other Card accounts you may have with us.

Further, the terms of each signup bonus specifically list the following purchases as types of spend that do not count towards the minimum spend requirements for the signup offer (bolding is mine): “cash advances, purchases of traveler’s checks, purchases or reloading of prepaid cards, purchases of gift cards, person-to-person payments, or purchases of any cash equivalents.”

What to avoid?

Last year’s post “How to Avoid Amex Clawbacks” is just as relevant today as it was then.  In that post, I offered the following advice:

  • Don’t buy gift cards or other cash equivalents until after receiving your signup bonus.  It is clear now that this includes gift card purchases at retail stores such as supermarkets.  I’d avoid buying gift cards altogether.
  • Don’t buy anything that you are likely to return until after receiving your signup bonus
  • Keep your new card for a year before closing (or product changing) the account

And I’ll add a new one:

  • Don’t use person-to-person payments with your Amex card while working on meeting minimum spend.  Examples of person-to-person payments include payments to friends using an Amex credit card via Venmo, Paypal, Apple Pay, etc.

How to meet minimum spend?

Here are suggested methods that should not run afoul of Amex’s rules:

  • Everyday Spend: This is obvious, but needs to be said for completeness.  Use the card for all day to day spend.
  • Timeshift Spend: With some utilities and other ongoing expenses it should be possible to pre-pay for charges that you know you’ll incur in the future.
  • Pay Bills: Obviously if a biller allows credit card payments, that’s a good way to go.  If not, consider using a service like Plastiq to pay bills (including things like rent, mortgage, day care, etc.).  You will have to pay a fee, but it can be well worth it to meet spend requirements quickly and easily.  Note that for Recipients in the United States, the use of American Express cards is permitted only for the following industries: Government (e.g. tax payments), Utilities, Education, Residential Rent and Club Fees and Memberships.
  • Pay Federal Taxes: Fees start at 1.89% for credit cards. Over-payments, if any, will be refunded after you file your year end taxes. For full details, please see: Complete guide to paying taxes via credit card, debit card, or gift card.
  • Fund Kiva Loans: Do good and hopefully get your money back. See: Manufacture Spend (and do good) with Kiva and Kivalens.
  • Buy/Sell merchandise (but not gift cards): For an overview, see: Increasing Spend through Reselling.

About Greg The Frequent Miler

Greg is the owner, founder, and primary author of the Frequent Miler. He earns millions of points and miles each year, mostly without flying, and dedicates this blog to teaching others how to do the same.

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Comments

  1. Interested in your thoughts…got a Morgan Stanley platinum last January. Will call for retention offer, but unless I receive a generous one, not interested in the $550. With my current travel I just don’t use many of the benefits. Probably did the bonus spending on vgc last January. Guess I’m still taking a bit of a risk by closing?
    Also, for a card into the second year, would you personally feel comfortable buying the occasional vgc from grocery store? Thanks!

  2. Like the war on drugs, this a crazy dog chasing its own tail. The bonuses are once per lifetime already, so they’re really going after the 0.5% here of first time churners. Is that really going to improve their bottom line? They can’t do anything about high spenders who are also gamers, and imagine how many legitimate business consumers who buy GC for marketing purposes get a rude awakening later.

  3. If Amex feels this strongly about gaming then they should also organize the RATS to email all related bloggers and stop advertising and promoting their cards on said “gamers” blogs and sites altogether including FT.

  4. The “What to Avoid” section in this article is so disingenuous it makes me shake my head. The author is simply saving face by telling people to comply with the terms and conditions, but this entire site is built on playing near the fringes of the terms and conditions. Frequent Miler used to be a source to educate people on how to operate within those fringes, but now it’s become so mainstream it’s almost not worth the time…

    • I wouldn’t blame the author for his advice; the playing field has changed over the years and what used to be undefined gray areas of T&C (what you call “fringes”) is now much more clearly defined, so this heads-up is welcomed in my book. Unfortunately, the “fringes” are a moving target, so the blog has to adapt to that. I would, however, advise Greg to prune his blog of older posts that are no longer accurate in today’s environment (if you’re already actively doing that, kudos).

  5. Unfortunately, Plastiq has become extremely restrictive in its use of AMEX cards. Have tried to use for legitimate business expenses such as accounting or insurance, and it was disallowed.

  6. I don’t think it’s that bad, just use prepaid items like cable bill, etc on Amex for legit spend, do the gaming on other cards. Hasn’t caused an issue for me – also can prepay Amazon balance, etc. Just keep the card a full year. I am still getting second and third lifetime offers from Amex every year.

  7. This is so stupid. I get the buying and returning items argument, but if I can legally use my card to make a purchase Amex need not worry what it’s for and shut the h*ll up on the matter. They are getting their swipe fees regardless.

    • exactly. bottom line here is that they’re clearly saying that they don’t want to pay the bonus out to *anybody* if at all possible. it’s a bait and switch, or carrot hanging from a stick tactic. f*ck amex.

      • You guys don’t get it. AmEx is not going to put up with unethical behaviour on the part of their cardholders. Obtaining a credit card just for the bonus and cancelling it before the annual fee is due is unethical. Don’t get a credit card unless you want to USE IT. There are plenty of opportunities to earn bonus miles and points without cheating.

        • @huey, are you thick??? That’s my exact argument!! Let me use the card and don’t penalize me when I legally do! I get the returning items and canceling before the first year arguments and frankly I agree. But Amex need not concern themselves with the content of my purchase history.

        • There are plenty of people who get the card for the bonus and do it via organic means. Not everyone who is a gamer needs MS, and also many non-gamers have legitimate use for Gift Cards….for business use. Amex are idiots.

  8. I received a 60,000 points bonus for upgrading my PRG card to platinum card this November. Do you think it’s safe to downgrading it back to PRG in Jan.? It’s of course less than a year, but AMEX’s new term did not mention about upgrading offers.

    • All of the targeted upgrade offers I have received in the last 2+ months have included the “if you cancel or downgrade your account within 12 months after acquiring it” language. This includes a 60k PRG->Platinum offer I received in November.

  9. In the comment section of DoC write up, there are more than one posters said their bonuses are declined because they use Plastiq to pay mortgage.

    You may want to look at the actual comments and modify your article which you continue to say mortgage payment fhru Plastiq still works though difficult.

    Plastiq seems one of the factors that would trigger a manual review on the account activities from the DPs posted.

    • Hey FLL – thanks for commenting. I count 1 person who said they were denied a bonus for Plastiq spend. There are a number of other people talking about Plastiq, but someone called AmexVictim is the only person I saw who said that they had a bonus denied because of Plastiq. I don’t think I saw any DPs at all connecting Plastiq and manual review. I’m not saying that’s impossible, I just didn’t see it in the comments on yesterday’s DoC post. Did you see more DPs than that?

      Also note that Greg said this:

      “Note that for Recipients in the United States, the use of American Express cards is permitted only for the following industries: Government (e.g. tax payments), Utilities, Education, Residential Rent and Club Fees and Memberships.”

      Also see that our Complete Guide to Plastiq for more on Plastiq payments and payment methods:

      http://frequentmiler.boardingarea.com/complete-guide-to-plastiq-credit-card-payments/

  10. Paying taxes is safe?

    Having problems too with those add authorized users to get bonus SPG and MR promos. No gift card spend yet some bonuses still not posted.

  11. It’s Christmas… people buy gift cards, even normal people! I’ll be pissed (and cancel my Amex cards) if they gripe about it. Gift cards aren’t the majority of spend on my newly-minted Delta Amex card, but it shouldn’t matter. A sale is made. What we choose to buy shouldn’t matter as long as we’re not doing anything illegal.

    /Go ahead Amex…give me another reason to drop you…like mucking up the Costco deal.

  12. does amex initiate the notice to customers via email / letter that the sign-up bonus was not given, or after customers contacted making inquiry about pts not posted?

    my relative got a BGR in Oct. with stmt date on the 15th; buying about $3k GCs at supermarkets in Nov., but acct hasn’t yet shown any MR pts as of today. should he inquire about the MR pt or wait til later this month post stmt date to see?

  13. Ooops! Gift cards in December *are* everyday spend! I just put a $100 Amazon card on my new Delta Gold. Is there a difference, if I spend $2100 for the first part of the bonus, instead of $2000? I’m scarcely gaming anybody here, just using the new card at Amazon during Xmas spending-spree month.

    • There are a bunch of expenses that don’t go to the initial spend requirement, but which wouldn’t necessarily get you shut down. Per the Delta Gold card offer: “Purchases to meet the spend requirement do NOT include … purchases or reloading of prepaid cards, purchases of gift cards, person-to-person payment, or purchases of any cash equivalents.” Reasonable, and not scary.

    • Chances are that Amex will count your Amazon gift card as legitimate spend. The issue is more that they can choose to exclude it if they want to. I’d only expect to see them do that with purchases that are specifically from gift card vendors and where you spent thousands in gift cards.

  14. I agree with a lot of the other commenters about buying gift cards. It’s holiday season, and there’s plenty of legitimate reasons why someone would buy a gift card at a store. I get that they want to avoid gaming, and I hardly buy gift cards in huge amounts, but it would be ridiculous to get an amex account with a many year history shut down because I bought a Barnes and Noble gift card. I mean, really. I’d like to think they apply some discretion in terms of how much of your entire spending pattern the gift cards make up. For me, probably about 1%.

    As for purchasing and returning items – again, I get that they want to avoid gaming, but there are absolutely legitimate reasons people decide to return something. It doesn’t fit, someone you bought it for already has one..I mean, if they’re asking us to buy literally anything we have the slightest chance of returning with a different card, well, that’s like asking me to take my business to visa or mastercard for holiday or cyber monday shopping.

  15. you can also pay property taxes with your credit card to meet spend requirements. It may be a 2% or 3% fee, but beats having an amex financial review!!

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