topic Re: American Express AA Due to Transaction Type in Credit Cards

American Express AA Due to Transaction Type

UncleB — Tue, 25 Aug 2015 05:32:57 GMT

Has anybody else ever heard of American Express taking AA against somebody based on what they used their card to purchase?

Edited to add: Other than MS, or other activities specifically against the "rules" in the cardmember agreement fine print.

Re: American Express AA Due to Transaction Type

heyarrnold — Tue, 25 Aug 2015 05:27:01 GMT

Yes, when a cardholder MS's.

Re: American Express AA Due to Transaction Type

ddemari — Tue, 25 Aug 2015 05:28:04 GMT

there a certain trigger purchases that can offset an FR. usually dealing with gift cards or some other type of MS.

Re: American Express AA Due to Transaction Type

peaceonearth — Tue, 25 Aug 2015 05:31:04 GMT

@UncleB wrote:
Has anybody else ever heard of American Express taking AA against somebody based on what they used their card to purchase?

Could be donution?

Re: American Express AA Due to Transaction Type

UncleB — Tue, 25 Aug 2015 05:31:07 GMT

@heyarrnold wrote:
Yes, when a cardholder MS's.

I guess I should have been more specific... MS is likely a violation of the 'fine print' somewhere, since it's artificially obtaining points/cash that one otherwise shouldn't be eligible for.

I'm talking about things like liquor stores, gun shops, etc.

There's a thread in the smorgasboard about how it's OK to buy guns with an Amex, and folks speculate how you shouldn't use your Amex at a liquor store. The 'lastest' is someone having an FR and during the phone conversation he was asked about a political contribution he had made using his card.

I'm just trying to determine if this is a real 'thing' or just coincidence and bad luck.

Re: American Express AA Due to Transaction Type

heyarrnold — Tue, 25 Aug 2015 05:34:35 GMT

@UncleB wrote:
@heyarrnold wrote:
Yes, when a cardholder MS's.
I guess I should have been more specific... MS is likely a violation of the 'fine print' somewhere, since it's artificially obtaining points/cash that one otherwise shouldn't be eligible for.

I'm talking about things like liquor stores, gun shops, etc.

There's a thread in the smorgasboard about how it's OK to buy guns with an Amex, and folks speculate how you shouldn't use your Amex at a liquor store. The 'lastest' is someone having an FR and during the phone conversation he was asked about a political contribution he had made using his card.

I'm just trying to determine if this is a real 'thing' or just coincidence and bad luck.

I don't think so. I've used my Amex at many liquor stores, and I've also paid off a car with it. So far, no issues.

Re: American Express AA Due to Transaction Type

UncleB — Tue, 25 Aug 2015 05:37:29 GMT

@peaceonearth wrote:
@UncleB wrote:
Has anybody else ever heard of American Express taking AA against somebody based on what they used their card to purchase?
Could be donution?

I wonder about that as well, but here's the thing about donations... the person getting the donation has to have a merchant agreement either with Amex or with somebody else that has an agreement with Amex... in other words, it's a bit disingenuous for Amex to take AA on someone for making a donation, when they are seemingly OK with the person/organizaton receiving the donation.

Re: American Express AA Due to Transaction Type

UncleB — Tue, 25 Aug 2015 05:43:26 GMT

@heyarrnold wrote:
@UncleB wrote:
@heyarrnold wrote:
Yes, when a cardholder MS's.
I guess I should have been more specific... MS is likely a violation of the 'fine print' somewhere, since it's artificially obtaining points/cash that one otherwise shouldn't be eligible for.

I'm talking about things like liquor stores, gun shops, etc.

There's a thread in the smorgasboard about how it's OK to buy guns with an Amex, and folks speculate how you shouldn't use your Amex at a liquor store. The 'lastest' is someone having an FR and during the phone conversation he was asked about a political contribution he had made using his card.

I'm just trying to determine if this is a real 'thing' or just coincidence and bad luck.
I don't think so. I've used my Amex at many liquor stores, and I've also paid off a car with it. So far, no issues.

I've never used mine to pay off a car, however "back in the day" I was known to use mine at the state store every few weeks, and I never had issues, either.

During this same time frame I paid off a firearm purchase at a pawn shop as well (father's anniversary gift from my step mom) and there were no questions asked after that, either. I was 'too stupid' to be concerned back then, though... LOL

Since the purchases I'm talking about were made during the period when Amex 'bucketed' folks based on the ZIP code of where they shopped, perhaps I was already 'bucketed' low to begin with...

Re: American Express AA Due to Transaction Type

Anonymous — Tue, 25 Aug 2015 05:52:07 GMT

I find it strange that what you bought from an Amex authorized merchant would cause an AA. If they don't approve products a business sells, then mabe that business shouldn't be an authorized merchant. Years ago, when I had an Amex issued card, I fell under and AA and got a CLD because I had used my card in Las Vegas. It was not even a gambling related transaction, just that I used the card in that city and that spooked them. The rep told me the reason for the CLD was because I used my card in a venue where it could have been potentially used for gambling. Crazy! The way I found out about it was when I tried to buy gas and was declined. They balance chased me all the way down to my balance. It took about 6 months to get my limit increased.

Re: American Express AA Due to Transaction Type

Anonymous — Tue, 25 Aug 2015 05:53:28 GMT

@UncleB wrote:

I've never used mine to pay off a car, however "back in the day" I was known to use mine at the state store every few weeks, and I never had issues, either.

During this same time frame I paid off a firearm purchase at a pawn shop as well (father's anniversary gift from my step mom) and there were no questions asked after that, either. I was 'too stupid' to be concerned back then, though... LOL

Since the purchases I'm talking about were made during the period when Amex 'bucketed' folks based on the ZIP code of where they shopped, perhaps I was already 'bucketed' low to begin with...

Did they really "bucket" people based on their zip codes?

Also, I'm still baffled by the Amex FR agent's question regarding whether or not that person made a political contribution using his Amex card. Why even ask that question if there's not more to it? Is a political contribution viewed differently somehow by Amex compared to, say, a Red Cross donation?

Re: American Express AA Due to Transaction Type

UncleB — Tue, 25 Aug 2015 06:01:45 GMT

@Anonymous wrote:
@UncleB wrote:
I've never used mine to pay off a car, however "back in the day" I was known to use mine at the state store every few weeks, and I never had issues, either.

During this same time frame I paid off a firearm purchase at a pawn shop as well (father's anniversary gift from my step mom) and there were no questions asked after that, either. I was 'too stupid' to be concerned back then, though... LOL

Since the purchases I'm talking about were made during the period when Amex 'bucketed' folks based on the ZIP code of where they shopped, perhaps I was already 'bucketed' low to begin with...
Did they really "bucket" people based on their zip codes?

Also, I'm still baffled by the Amex FR agent's question regarding whether or not that person made a political contribution using his Amex card. Why even ask that question if there's not more to it? Is a political contribution viewed differently somehow by Amex compared to, say, a Red Cross donation?

Yep, it was actually a pretty big deal in the news when it first came out. Here's one link dating back to 2008:

http://www.nbcnews.com/id/27055285/ns/business-stocks_and_economy/t/amex-rates-credit-risk-where-you-live-shop/

Supposedly they no longer do this, but as to if they actually really stopped, you're guess is as good as mine.

(You can do a Google search for many other news stories about this, but for brevity I only provided the one link)

Re: American Express AA Due to Transaction Type

Anonymous — Tue, 25 Aug 2015 06:03:05 GMT

What is "bucket" people?

Re: American Express AA Due to Transaction Type

UncleB — Tue, 25 Aug 2015 06:06:21 GMT

Also, as far as I know they still take into account your billing ZIP code as one factor to determine your credit worthiness even now, which some might argue is an acceptable practice. I haven't made up my mind yet.

What made the old practice so despicable is that it literally penalized folks for shopping in less affluent areas of town, regardless of their own means... again, supposedly they stopped the practice, but it's a shame they ever started it.

Re: American Express AA Due to Transaction Type

UncleB — Tue, 25 Aug 2015 06:08:55 GMT

@Anonymous wrote:
What is "bucket" people?

'Bucketed' means put into a category.

For example, someone with a billing address in the ZIP code 90210 might be treated a little differently than somebody with a billing ZIP code in rural Mississippi when it comes to getting approval for a transaction that is outside the normal spending patterns.

Re: American Express AA Due to Transaction Type

Anonymous — Tue, 25 Aug 2015 06:12:38 GMT

So... If I change my billing address to my work, which is in slightly better neighborhood than my home address, I might be able to get better card from Amex?
No wonder my coworker forwarded her credit card to work. 😆

Re: American Express AA Due to Transaction Type

Anonymous — Tue, 25 Aug 2015 06:16:13 GMT

And you might get an even better card if you change your financial information to indicate you're an employee of Capital One

Re: American Express AA Due to Transaction Type

Anonymous — Tue, 25 Aug 2015 06:17:51 GMT

I'm actually moving to a different state next month. Having worked in credit, I seldom see the type of high credit lines from where we are moving to, like folks around here have. Seriously, I've seen lots and lots of 5 digit credit lines here, but mostly low 4 digit lines out of there, if not in the hundreds. It's northern California, btw. I wonder if I should be concerned?

Re: American Express AA Due to Transaction Type

UncleB — Tue, 25 Aug 2015 06:21:30 GMT

@Anonymous wrote:
So... If I change my billing address to my work, which is in slightly better neighborhood than my home address, I might be able to get better card from Amex?
No wonder my coworker forwarded her credit card to work.😆

LOL... if it were that easy, I would have done that years ago!

Seriously, you might not get any better 'deals', but they use it as, quote, "...one of the factors" along with likely dozens of other things when determining when to do an FR, take AA, question purchases outside your normal spending patterns, etc.

My billing ZIP code is rather modest, but just 30 miles away is the "wealthiest" ZIP in my state, which is why a few years ago when they would take AA on folks based on where they shopped it was so bad. If somebody from the 'good' side of town went 'slumming' in my neighborhood to do some shopping, Amex would have taken notice... LOL.

Thankfully they got called out for it.

Re: American Express AA Due to Transaction Type

Anonymous — Tue, 25 Aug 2015 06:22:50 GMT

I may be wrong here...but i truly believe Amex still "profiles" transactions. For example...

1. Where are u using your card (walmart, kmart, McDonalds, etc)

2. How much is your charge (are u charging small amounts...intimating that you do not have sufficient cash to pay for nominal transactions)

3. Where do you live (zip code, demographics, etc)

4. Frequency (How many times are you charging instead of paying cash or using other credit means)

I think Amex gets spooked by these things..leading you up to a possible FR. Just my 2 cents

Re: American Express AA Due to Transaction Type

onstar — Tue, 25 Aug 2015 06:24:39 GMT

@UncleB wrote:
Also, as far as I know they still take into account your billing ZIP code as one factor to determine your credit worthiness even now, which some might argue is an acceptable practice. I haven't made up my mind yet.

What made the old practice so despicable is that it literally penalized folks for shopping in less affluent areas of town, regardless of their own means... again, supposedly they stopped the practice, but it's a shame they ever started it.

Yeah, I have no problem with ZIP and where you shop and whatever. Keeping in mind that each of these factors are all just one factor among dozens to determine credit worthiness. The actuaries will use every bit of data if they see correlation.

Auto insurance works similarly. They bucket by ZIP (home & work), distance from work to home, sex, age, years licensed, driving record, number of at fault accidents (sometimes number of accidents regardless of fault), college graduate or not, what major in college, marital status, credit score (in some states), etc. Point being, actuaries will use just about everything to see if there is any pattern. With actuarial work, pretty much everything is legal as long as data can support it. For example, they can absolutely discriminate based on gender. In some ZIP, men have higher insurance rates than women; in some other ZIP, women have higher insurance rates than men. And they can discriminate based on age. Rates typically drop until you get to a certain age, then it can go up. I don't see why credit cards should work differently.

It's not like they're pulling a "Kardashian Kard" and exploiting people. The actuaries at Amex (and whatever other banks that do this) are merely doing their due diligence and giving proper credit based on data.