topic Re: Gaining points/miles for free using Paypal? in Credit Cards

Gaining points/miles for free using Paypal?

Darius1976 — Thu, 23 Jan 2014 16:24:10 GMT

This is a little immoral story, but I wanted to know if its sounds true. I didn't think it was. Anyhow. I talked with a friend of mine and he stated that he and another friend want to test a theory and it worked. He had a Delta miles card and his friend had a paypal account. He transferred money buy "purchasing" an item from his friend and paid it to the paypal account. Once the paypal account cleared the money, the other guy withdrew the money and just gave it back to the orignal guy.

Isn't that really shady thing to do? What are your thoughts?

Re: Gaining points/miles for free using Paypal?

ksantangelo23 — Thu, 23 Jan 2014 16:45:15 GMT

This would fall under the "Manufactured Spending" conversation

If done in moderation, or at least very carefully, you can get away with it. But if your lender finds out you're clearly, and obviously gaming their reward system, they will come down on you hard.

Re: Gaining points/miles for free using Paypal?

jamesdwi — Thu, 23 Jan 2014 16:49:39 GMT

Its called manuafactored spending, and is forbidden in most credit card agreements, it does happen, its dangerous for the credit card holder, if the person with the paypal account doesn't give you the money back it can get ugly, if you are caught the creditor will shut down all of your accounts, and possibly black list you for life, don't forget that paypal has fee's as well which are greater than the rewards you get, could be helpful for meeting spend requirements to get sign up bonuses.

Re: Gaining points/miles for free using Paypal?

Darius1976 — Thu, 23 Jan 2014 17:47:34 GMT

i totally agee. I told him that credit card companies have ways to protect themselves from those types of actions. it didn't sound good at all.

Re: Gaining points/miles for free using Paypal?

indiolatino61 — Thu, 23 Jan 2014 18:21:13 GMT

@Darius1976 wrote:
This is a little immoral story, but I wanted to know if its sounds true. I didn't think it was. Anyhow. I talked with a friend of mine and he stated that he and another friend want to test a theory and it worked. He had a Delta miles card and his friend had a paypal account. He transferred money buy "purchasing" an item from his friend and paid it to the paypal account. Once the paypal account cleared the money, the other guy withdrew the money and just gave it back to the orignal guy.

Isn't that really shady thing to do? What are your thoughts?

Most things that seem shady usually are...lol.

Re: Gaining points/miles for free using Paypal?

Anonymous — Thu, 23 Jan 2014 18:59:33 GMT

@jamesdwi wrote:
Its called manuafactored spending, and is forbidden in most credit card agreements, it does happen, its dangerous for the credit card holder, if the person with the paypal account doesn't give you the money back it can get ugly, if you are caught the creditor will shut down all of your accounts, and possibly black list you for life, don't forget that paypal has fee's as well which are greater than the rewards you get, could be helpful for meeting spend requirements to get sign up bonuses.

I don't think this is particularly forbidden in the T&Cs, which focus more on buying of cash equivalents, whereas this is more of a fake transaction. What stops this more, as you say, is the PP fees, did the friend return the total purchase price (in which case there was a loss) or purchase-fees, in which case the transaction probably wasn't profitable for the card holder.

Using phrases like "shady" doesn't mean much. There is a sliding scale that each person has a comfort level with. For example, where are you on this scale!

1) I apply for a card I don't really "need", just for the bonus.

1a) Shortly after meeting the bonus, I close the card

1b) or, since it doesn't have an AF, I just SD it.

2) As above in 1a), then after whatever time is needed, I apply again and churn for the bonus

3) I use Amazon payments to send $1K to my partner, and he/she withdraws it and gives it back as a check (a smarter way of what was described in the OP)

4) I MS $2K a month

5) I MS $20K a month

6) I MS $200K a month

7) I work at a bar, and whenever possible I clone people's cards and sell them to a friend for $100 each

8) I kill people, hide their bodies and steal their cards, this gives me a long time to use them before they are reported.

Re: Gaining points/miles for free using Paypal?

Fico2Go — Thu, 23 Jan 2014 21:01:25 GMT

@Anonymous wrote:
@jamesdwi wrote:
Its called manuafactored spending, and is forbidden in most credit card agreements, it does happen, its dangerous for the credit card holder, if the person with the paypal account doesn't give you the money back it can get ugly, if you are caught the creditor will shut down all of your accounts, and possibly black list you for life, don't forget that paypal has fee's as well which are greater than the rewards you get, could be helpful for meeting spend requirements to get sign up bonuses.

I don't think this is particularly forbidden in the T&Cs, which focus more on buying of cash equivalents, whereas this is more of a fake transaction. What stops this more, as you say, is the PP fees, did the friend return the total purchase price (in which case there was a loss) or purchase-fees, in which case the transaction probably wasn't profitable for the card holder.

Using phrases like "shady" doesn't mean much. There is a sliding scale that each person has a comfort level with. For example, where are you on this scale!

1) I apply for a card I don't really "need", just for the bonus.
1a) Shortly after meeting the bonus, I close the card
1b) or, since it doesn't have an AF, I just SD it.

2) As above in 1a), then after whatever time is needed, I apply again and churn for the bonus

3) I use Amazon payments to send $1K to my partner, and he/she withdraws it and gives it back as a check (a smarter way of what was described in the OP)

4) I MS $2K a month

5) I MS $20K a month

6) I MS $200K a month

7) I work at a bar, and whenever possible I clone people's cards and sell them to a friend for $100 each

8) I kill people, hide their bodies and steal their cards, this gives me a long time to use them before they are reported.

LTlurker,

Before #1 is also this one:

a) I freeze all my CRs except the one I want creditors to see;

b) I RECON and ask the creditor to HP only the CRA that favors me;

There is also #19:

Which goes something like this..

a) I know and am aware that reload cards require cash to buy but I will come up with many ways to trick the cashier to selling me one;

b) I will buy reload cards from CVS but only at late evenings when no one is really paying attention;

c) I will offer to pay a cashier at CVS so he will sell me a reload card using CC;

For me tho I probably fit in #20 which goes like this:

I find the closest card to 5% rewards and I MS and load to paypal. Then pay for things using Paypal and get an extra 1.5% cashback for using PP debit card.

Re: Gaining points/miles for free using Paypal?

myjourney — Thu, 23 Jan 2014 23:47:46 GMT

@Fico2Go wrote:
@Anonymous wrote:
@jamesdwi wrote:
Its called manuafactored spending, and is forbidden in most credit card agreements, it does happen, its dangerous for the credit card holder, if the person with the paypal account doesn't give you the money back it can get ugly, if you are caught the creditor will shut down all of your accounts, and possibly black list you for life, don't forget that paypal has fee's as well which are greater than the rewards you get, could be helpful for meeting spend requirements to get sign up bonuses.

I don't think this is particularly forbidden in the T&Cs, which focus more on buying of cash equivalents, whereas this is more of a fake transaction. What stops this more, as you say, is the PP fees, did the friend return the total purchase price (in which case there was a loss) or purchase-fees, in which case the transaction probably wasn't profitable for the card holder.

Using phrases like "shady" doesn't mean much. There is a sliding scale that each person has a comfort level with. For example, where are you on this scale!

1) I apply for a card I don't really "need", just for the bonus.
1a) Shortly after meeting the bonus, I close the card
1b) or, since it doesn't have an AF, I just SD it.

2) As above in 1a), then after whatever time is needed, I apply again and churn for the bonus

3) I use Amazon payments to send $1K to my partner, and he/she withdraws it and gives it back as a check (a smarter way of what was described in the OP)

4) I MS $2K a month

5) I MS $20K a month

6) I MS $200K a month

7) I work at a bar, and whenever possible I clone people's cards and sell them to a friend for $100 each

8) I kill people, hide their bodies and steal their cards, this gives me a long time to use them before they are reported.

LTlurker,

Before #1 is also this one:

a) I freeze all my CRs except the one I want creditors to see;
b) I RECON and ask the creditor to HP only the CRA that favors me;

There is also #19:

Which goes something like this..

a) I know and am aware that reload cards require cash to buy but I will come up with many ways to trick the cashier to selling me one;
b) I will buy reload cards from CVS but only at late evenings when no one is really paying attention;
c) I will offer to pay a cashier at CVS so he will sell me a reload card using CC;

For me tho I probably fit in #20 which goes like this:

I find the closest card to 5% rewards and I MS and load to paypal. Then pay for things using Paypal and get an extra 1.5% cashback for using PP debit card.

This is not encouraged and is in a violation of the TOS please refrain

Thanks MJ

Re: Gaining points/miles for free using Paypal?

Anonymous — Thu, 23 Jan 2014 23:54:13 GMT

@myjourney wrote:
@Fico2Go wrote:
@Anonymous wrote:
@jamesdwi wrote:
Its called manuafactored spending, and is forbidden in most credit card agreements, it does happen, its dangerous for the credit card holder, if the person with the paypal account doesn't give you the money back it can get ugly, if you are caught the creditor will shut down all of your accounts, and possibly black list you for life, don't forget that paypal has fee's as well which are greater than the rewards you get, could be helpful for meeting spend requirements to get sign up bonuses.

I don't think this is particularly forbidden in the T&Cs, which focus more on buying of cash equivalents, whereas this is more of a fake transaction. What stops this more, as you say, is the PP fees, did the friend return the total purchase price (in which case there was a loss) or purchase-fees, in which case the transaction probably wasn't profitable for the card holder.

Using phrases like "shady" doesn't mean much. There is a sliding scale that each person has a comfort level with. For example, where are you on this scale!

1) I apply for a card I don't really "need", just for the bonus.
1a) Shortly after meeting the bonus, I close the card
1b) or, since it doesn't have an AF, I just SD it.

2) As above in 1a), then after whatever time is needed, I apply again and churn for the bonus

3) I use Amazon payments to send $1K to my partner, and he/she withdraws it and gives it back as a check (a smarter way of what was described in the OP)

4) I MS $2K a month

5) I MS $20K a month

6) I MS $200K a month

7) I work at a bar, and whenever possible I clone people's cards and sell them to a friend for $100 each

8) I kill people, hide their bodies and steal their cards, this gives me a long time to use them before they are reported.

LTlurker,

Before #1 is also this one:

a) I freeze all my CRs except the one I want creditors to see;
b) I RECON and ask the creditor to HP only the CRA that favors me;

There is also #19:

Which goes something like this..

a) I know and am aware that reload cards require cash to buy but I will come up with many ways to trick the cashier to selling me one;
b) I will buy reload cards from CVS but only at late evenings when no one is really paying attention;
c) I will offer to pay a cashier at CVS so he will sell me a reload card using CC;

For me tho I probably fit in #20 which goes like this:

I find the closest card to 5% rewards and I MS and load to paypal. Then pay for things using Paypal and get an extra 1.5% cashback for using PP debit card.

This is not encouraged and is in a violation of the TOS please refrain
Thanks MJ

That's quite funny, giving the impression that freezing your reports is more frowned upon than my 7 and 8!

Re: Gaining points/miles for free using Paypal?

myjourney — Fri, 24 Jan 2014 00:05:18 GMT

@Anonymous wrote:
@myjourney wrote:
@Fico2Go wrote:
@Anonymous wrote:
@jamesdwi wrote:
Its called manuafactored spending, and is forbidden in most credit card agreements, it does happen, its dangerous for the credit card holder, if the person with the paypal account doesn't give you the money back it can get ugly, if you are caught the creditor will shut down all of your accounts, and possibly black list you for life, don't forget that paypal has fee's as well which are greater than the rewards you get, could be helpful for meeting spend requirements to get sign up bonuses.

I don't think this is particularly forbidden in the T&Cs, which focus more on buying of cash equivalents, whereas this is more of a fake transaction. What stops this more, as you say, is the PP fees, did the friend return the total purchase price (in which case there was a loss) or purchase-fees, in which case the transaction probably wasn't profitable for the card holder.

Using phrases like "shady" doesn't mean much. There is a sliding scale that each person has a comfort level with. For example, where are you on this scale!

1) I apply for a card I don't really "need", just for the bonus.
1a) Shortly after meeting the bonus, I close the card
1b) or, since it doesn't have an AF, I just SD it.

2) As above in 1a), then after whatever time is needed, I apply again and churn for the bonus

3) I use Amazon payments to send $1K to my partner, and he/she withdraws it and gives it back as a check (a smarter way of what was described in the OP)

4) I MS $2K a month

5) I MS $20K a month

6) I MS $200K a month

7) I work at a bar, and whenever possible I clone people's cards and sell them to a friend for $100 each

8) I kill people, hide their bodies and steal their cards, this gives me a long time to use them before they are reported.

LTlurker,

Before #1 is also this one:

a) I freeze all my CRs except the one I want creditors to see;
b) I RECON and ask the creditor to HP only the CRA that favors me;

There is also #19:

Which goes something like this..

a) I know and am aware that reload cards require cash to buy but I will come up with many ways to trick the cashier to selling me one;
b) I will buy reload cards from CVS but only at late evenings when no one is really paying attention;
c) I will offer to pay a cashier at CVS so he will sell me a reload card using CC;

For me tho I probably fit in #20 which goes like this:

I find the closest card to 5% rewards and I MS and load to paypal. Then pay for things using Paypal and get an extra 1.5% cashback for using PP debit card.

This is not encouraged and is in a violation of the TOS please refrain
Thanks MJ
That's quite funny, giving the impression that freezing your reports is more frowned upon than my 7 and 8!

Actually I'll be watching the whole thread because It's full of unrelated credit subject matter going on here

Re: Gaining points/miles for free using Paypal?

juggalo9er — Fri, 24 Jan 2014 00:04:21 GMT

and the easiest way to "hypothetically" get away with manufactured spending can be found at any wal mart gas station! in theory they sell prepaid mastercards for 3.95 which can have up to 500 loaded on them. using barclay for an example who gives 2% cash back..the net profit is 5.95, minus the 1 dollar fee for transfering the money to your bank account where you can easily make a payment on the chosen credit card. i would relate this to bill clintons testimony in regards to his relationship with monica lewinsky!

Re: Gaining points/miles for free using Paypal?

flowfaster — Fri, 24 Jan 2014 00:06:25 GMT

PP will shut you down quick if you get caught. There are better methods as pointed out by the other posters.

In the end though it's no risk, no reward. IMO you have to find a middle ground. A level that YOU and the banks can both deal with. If you do too much, the banks will shut you down and flag you as a point abuser (CHASE) but on the other hand you will never really reap all the huge benefits if you just sit idly by. These big banks are not loyal to you and neither should you, to them. Use them as a tool to create a better life for yourself.

Re: Gaining points/miles for free using Paypal?

Fico2Go — Fri, 24 Jan 2014 01:02:44 GMT

MSing is risky for PP or any deposit taking instituions. People need to understand that they need to make money somehow somewhere. So just feed them a little.

I have a business that runs a bit of volume for the past ten years and I don't plan to MS and withdraw to bank accounts that many have done and had their accounts closed.

Ok enough MS talking. There's more to doing things than some of you know and withdrawing money into an account is not a great way to build relationship with PP.

Re: Gaining points/miles for free using Paypal?

lenz99 — Fri, 24 Jan 2014 01:14:07 GMT

The question is, why paypal? its not free for sending $$ from a CC, there is 2.9%+$0.3 fee. So are you willing to pay 3 cents for 1 mile?

Re: Gaining points/miles for free using Paypal?

Fico2Go — Fri, 24 Jan 2014 01:21:17 GMT

Paypal pays me 1.5% for purchase transactions completed using my paypal mastercard. Since I will be running 50-100 sales a month through paypal MSing would not be an isolated transaction so can mix in quite well.

I am also a business owner that has access to other merchant accounts that will allow me to place charges to my PP debit cards. Fee might offset the 1.5% that PP pays me.