Laundering FF points

[JohnK]

Regardless of how much one values 132,000 FF points there is no way I am going to risk $200,000 to get these points. There is no such thing as a sure bet and even if the odds are $1.01 there is still a chance that one can lose the bet. No need for me to document as there are plenty of examples to draw by in history.

I will point out what will inevitably follow... posting this strategy on a public forum may result in this method being shut down by any credit card provider who reads your post.

Many credit card providers already treat these type of transactions as cash advances and the ones that don't will slowly catch-up as we are seeing with NAB.

 

[Alistair]

I haven't seen it mentioned her yet but wouldn't becoming a merchant on Paypal be just as effective an carry less risk? Ives been toying with it make money on currency movements with my cba travel cards. Could work just as easy to make points.

I've thought about it, but am pretty sure the PayPal fees don't make this an economical proposition.

 

[Alistair]

What's the protocol when returning goods to stores? Do you need to present the same method of payment to obtain a refund?

For instance, if I bought a $5000 home entertainment system with my credit card from a retailer with a returns policy, could I bring it back the next day and have it refunded in another method? (ie. cash, put back on another credit card etc.)?

Or for that matter, are QFF points DEDUCTED when a refund takes place?

Using the above example (and presuming I earn 1pt:$1), would my QFF balance be docked the 5000 points that I earned the previous day when I bought the system?

 

[drewbles]

What's the protocol when returning goods to stores? Do you need to present the same method of payment to obtain a refund?

For instance, if I bought a $5000 home entertainment system with my credit card from a retailer with a returns policy, could I bring it back the next day and have it refunded in another method? (ie. cash, put back on another credit card etc.)?

Or for that matter, are QFF points DEDUCTED when a refund takes place?

Using the above example (and presuming I earn 1pt:$1), would my QFF balance be docked the 5000 points that I earned the previous day when I bought the system?

Good question. I know they usually like to refund the same way as the transaction was processed. I have no idea if it has to be the exact same card though.

Most places won't refund in cash where a card has been used which is understandable, but I don't believe there is any actual restriction on an EFTPOS terminal to only refund to cards that have had a transaction processed before the refund is attempted.

Could be interesting (assuming you have two types of Amex or Visa or MasterCards) to try this.

And yes, most banks will deduct points. If it's a direct-sweep type setup like 99% of QF cards, you'll simply go into deficit, and they won't re-credit your FF account until the deficit is gone. Have experienced this with Amex (non-QF card; just membership rewards) and the old Westpac Altitude card.

 

[Alistair]

What's to stop you making a significant purchase and returning it the next week? When they ask for your original card, tell them you lost it, or cancelled it or something that renders it useless to you at that point in time. Would they deny you a refund on a big ticket item? Would they dare leave you hanging $5k out of pocket? When can one view the fine print on store refund policies?

 

[BVT]

What's to stop you making a significant purchase and returning it the next week? When they ask for your original card, tell them you lost it, or cancelled it or something that renders it useless to you at that point in time. Would they deny you a refund on a big ticket item? Would they dare leave you hanging $5k out of pocket? When can one view the fine print on store refund policies?

Pay with a point accumulative credit card and return for a store credit. Only useful if you would normally buy things at that store.

 

[Alistair]

Alternatively have a chat with a friend who owns/manages a store. Surely we all know a small retailer we can go into "business" with?

 

[significance]

One more thing to bear in mind is the interest you are paying in the meantime. Banks often take 2-3 days to acknowledge a deposit by transfer, and you will be paying interest on the mortgage or line of credit in the meantime (plus the day or so that it takes for the "sure thing" to become a real event, and whatever time it takes the bookie to pay up). You should still come out ahead, but it's another cost to add to the risk equation.

 

[cove]

If you know someone in business who is electronically paying their Tax Office BAS you could put your card in to pay and gather points they are not interested in gathering.
On Amex those points cost 0.833 cents each.
You would need to know and trust that business person......

 

[MAX_1]

I regularly offer my Key staff to pay a few accounts with their credit card. Then I Bpay the ammount of each account to their card.

 

[cove]

That is the spirit Max_1.

 

[MAX_1]

I read of a person who had a business and decided to charge to his own Amex a substantial amount. He then "returned" the goods and paid out cash to himself. So to the business there was gross change ( Amt charged - amt credited ) except for the Amex fee on the transaction, which was treated as an expense.
Amex subsequently cancelled his card.

So using this method to launder points can be dangerous.

 

[medhead]

What's the protocol when returning goods to stores? Do you need to present the same method of payment to obtain a refund?

For instance, if I bought a $5000 home entertainment system with my credit card from a retailer with a returns policy, could I bring it back the next day and have it refunded in another method? (ie. cash, put back on another credit card etc.)?

Or for that matter, are QFF points DEDUCTED when a refund takes place?

Using the above example (and presuming I earn 1pt:$1), would my QFF balance be docked the 5000 points that I earned the previous day when I bought the system?

The card companies has thought of this and specifically set up the system so that it can't work. Firstly, you are supposed to have the refund put back onto your card. Sure some places will let you use a different card. Either way when the credit goes back onto the card you lose the points. I've had to argue this point with both NAB and ANZ when losing points for getting a GST refund. Does not matter if there is no matching purchase, they automatically deduct the points.

 

[JohnK]

What's to stop you making a significant purchase and returning it the next week? When they ask for your original card, tell them you lost it, or cancelled it or something that renders it useless to you at that point in time. Would they deny you a refund on a big ticket item? Would they dare leave you hanging $5k out of pocket? When can one view the fine print on store refund policies?

So go around purchasing items from various stores and then return the goods for a full refund to a non-points earning credit card? Now why didn't I think of it?

Alternatively have a chat with a friend who owns/manages a store. Surely we all know a small retailer we can go into "business" with?

Be very very careful....

 

[cove]

Yes there are truly bad transactions that can get you blacklisted.
Putting your own credit card thru your own credit card machine will get the riot act read to you by the credit card surveillance back room. Don't go there unless you really wish to put yourself into cough position with your Bank.
It has never been necessary to lie and cheat.

 

[ermen]

Was thinking about this - can you make extra payments to the ATO for PAYG tax and claim it as a refund after you file a tax return? This could be useful now given the EOFYS and nobody is out of pocket - ATO gets to keep your money for a few months and you oay for your points

 

[kpc]

I've had to argue this point with both NAB and ANZ when losing points for getting a GST refund. Does not matter if there is no matching purchase, they automatically deduct the points.

I use my non points earning credit card (28 degrees MC) when claiming the GST back with the TRS scheme...after all, I'm heading OS and the card is very handy in my passport wallet

 

[Chatterbocks]

dear me...recent past is littered with cases of people putting low risk, low return on bets deemed 'sure things'. People always misunderstand the probabilities of extreme, unpredicatable events. OP is doing what is commonly called in trading circles as "picking up pennies in front of a steamroller". OP needs to objectively map out the maths - based on what was posted you would need one outlier event in something like 200 events to wipe yourself out. This could be either the event you bet on or the betting agency going bust with your cash or anything.

if this was 3-4 years ago you could potentially have been betting on such crazy and impossible events such as AIG going bankrupt, a drawn AFL grand final, Iceland going bankrupt or any of the other low probability events which have transpired over recent history.

This is probably the worst risk/reward endeavour I have witnessed to be honest.

I applaud the creative thinking and I have had similar ideas regarding CFD providers which treat deposits into your trading account as a purchase, not a cash advance. But I would rather dedicate my energies to something bigger than skimming a few bucks worth of FF points here and there. Or at least, rework the strategy so that you have zero exposure to risk.

 

[neslon]

Sorry to bump this old thread.. but do any credit cards these days w/frequent flyer points allow points to be earned with depositing online betting sites?

 

[Stephen65]

I read of a person who had a business and decided to charge to his own Amex a substantial amount. He then "returned" the goods and paid out cash to himself. So to the business there was gross change ( Amt charged - amt credited ) except for the Amex fee on the transaction, which was treated as an expense.
Amex subsequently cancelled his card.

Amex have very strict rules against these sorts of transactions and from what I have read online their usual response to a breach is a cancellation of your cards. Anything that involves you using your card or your card via paypal to effectively pay yourself, a related entity, a relative, an associate or someone you have given a supplementary card to or which is in effect creating a cash advance off the card is totally verboten. Not only does it expose Amex to the risk that you are using their card for money laundering the fact that you are using their card to settle these sorts of debts may well indicate you are in financial difficulties or unable to pay the monthly balance.

The same for churn type transactions that look like they are being undertaken just to generate points.