CCCs pushing AUs hard, any downside?

[Anonymous]

I've noticed for the last year or so that many CCCs are really pushing the addition of an AU to accounts.  I get hit with this any time I end a call or end chat with quite a few of them like Amex & Citi for example.  I'm wondering if there is any downside to the addition of an AU from the lender perspective.  I would guess that any downside is outweighed by the positive, or they wouldn't be pushing them so hard.  I suppose the obvious benefit would be greater revenue through greater overall spend and that you've got 2 people to hold accountable in terms of getting paid back.  Just looking for some additional insight on this topic.

[gdale6]

Some banks care about the AU others dont. They are pushing them so they can increase their profits not to benefit you. An AU is not responsible for repayment of any charges you are even if they dont pay.

[Anonymous]

Yeah I guess I sort of misspoke in terms of 2 people being held accountable... more that there are 2 people that have the ability to pay, which benefits the lender.  It would be the primary holding the AU accountable.  100% correct that they are pushing them for profits and not for the account holder.

So, any downsides from the lender perspective?

[blindambition]

They have been pushing them hard. I don't think there's a downside, but that's if account and legitimate users are handling accounts properly and responsibly.

There have been closures and account locks, once someone added AU. Most of those cases have had other issues that caused red flags. Like I added my mom, my neighbor, and cousins friend who lives 3500 miles away... Why did they close my account???

[Curious_George2]

The closures that Blindambition references came to mind for me too. It seems like a bit of a minefield. Lenders promote these, but then take AA against some people for some of the AUs they add. So I guess they see... fraud risk? Scoring algorithm abuse risk? Apparently in the lenders' eyes, there are good AUs and bad AUs, but they are intentionally secretive about the difference. So we cardholders can only guess who will be which.

I dislike that guessing game, so I have decided to take the cautious approach and steer clear of all new AU arrangements. 

Also, though not responsive to your question, I dislike giving or receiving AU status because it complicates FICO management. The AU all-zero penalty is so annoying!

[Anonymous]

When you add an AU, what sort of information is provided?  Do different lenders have different rules regarding AUs, like who it can/can't be?  I've never added an AU nor have I ever been an AU, so I know nothing about them.

[dragontears]

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@Anonymous wrote:

When you add an AU, what sort of information is provided?  Do different lenders have different rules regarding AUs, like who it can/can't be?  I've never added an AU nor have I ever been an AU, so I know nothing about them.

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Depends on the lender, some like chase you just need to give the AU name, others like Amex and Cap1 require the AU SSN.

[Loquat]

For the sake of the topic I will say that Bank of America is known to scrutinize AUs a bit harder than most. And by scrutinize meaning they want you to really know the person you're adding. I've read on a few occasions of them shutting accounts down for folks rapidly adding AUs to their account.

Not sure if this is still a thing now as it's been a bit ago that I read such, but something to be mindful of.

[FalconSteve]

AUs can increase spend, but they are not accountable for any balance.

Only joint account holders are accountable, otherwise, you could add someone as an AU, rack up a huge balance and make it their problem.

[GApeachy]

I think all banks love the additional swipe fees.  Plus they have access to AU's personal info. and can target them with offers.