AMEX Takes More Steps To Stop You From Earning Easy Points


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Over recent years, American Express has been the more active of the banks when it comes to clamping down on people using its sign-up bonuses and its credit cards to generate easy points bonanzas.

Now, in case anyone was in doubt of AMEX’s determination to stamp out all avenues by which its cards could be used to generate easy and cheap points, the card issuer has just made another move against those its thinks are gaming its systems.

A few years ago, American Express was the first major card issuer to introduce significant controls on its sign-up bonuses when it introduced the idea that customers could only earn one sign-up bonus per card per lifetime.

Wording like this started to appear in the terms and conditions…

…and miles & points enthusiasts suddenly had to be a lot more discerning when considering which AMEX cards to apply for.

The next move that AMEX took was to restrict what purchases would qualify towards the minimum spending requirements customers had to reach in order to earn the sign-up bonus on offer.

Specifically, wording was introduced into the terms and conditions which excluded gift card purchases from contributing to minimum spend requirements:

This was a significant hit to a lot of people, as gift card purchases have long been one of the key routes to hitting some of the bigger minimum spend targets, as well as being a key component to the strategies of those who apply for multiple credit cards at once and who therefore need to meet significant spending targets over the course of 3 to 4 months.

Apparently, those restrictions weren’t enough for American Express as cardholders have now been noticing yet more new wording starting to appear in the terms and conditions of various credit cards….and these new restrictions are aimed at all cardholders and not just those looking to earn a sign-up bonus. [HT: Doctor of Credit]

Gift Card Purchases No Longer Earn Points

Holders of select credit/charge cards are now seeing the terms and conditions of their cards altered to include a clause that prevents gift card purchases from earning whatever currency the card ordinarily offers.

Reports suggest that no all cards currently have this new wording in their terms & conditions but, if you hold the American Express Gold Card,…

…or the American Express Blue Business Plus card (amongst others)…

…any gift card purchases you make will not add to your points earnings in any way.

AMEX gift card purchases have been excluded from points earning since March 2018 and now it would appear as if American Express is going further and attempting to exclude all gift card purchases from points.

Thoughts

When it comes to purchases made at office supply stores my understanding is that AMEX sees exactly what has been purchased and there’s no hiding your gift card purchases – this is called Level 3 reporting.

Reports appear to suggest that for purchases at grocery stores, drugstores, online retailers, etc… American Express doesn’t always automatically know if a purchase includes gift cards, but that it does have the ability to examine transactions more closely and identify gift card purchases that way.

What this means is that just because you buy gift cards from somewhere that doesn’t automatically flag this fact up to AMEX (i.e. a retailer which doesn’t offer Level 3 reporting) doesn’t mean that you’re in the clear.

Comments on other sites (like Doctor of Credit) have long indicated that AMEX is more than happy to examine large or unusual transactions and has a history of clawing back points when they were earned through means specifically disallowed by its terms and conditions.

How I Expect This To Play Out

Cardholders who buy gift cards infrequently and not in high-value batches will probably pass through AMEX’s systems unnoticed (or at least unbothered) as long as they’re not making purchases from retailers which offer Level 3 reporting.

Anyone buying gift cards at retailers offering Level 3 reporting can probably kiss goodbye to any points earning on those transactions and anyone making large transactions at retailers where those transactions look out of place (think $500+ transactions at grocery stores or drugstores) may well draw attention to themselves and find their purchases reviewed even if Level 3 reporting is not available to American Express.

What we really need now is a list of retailers that do (or do not) offer Level 3 reporting – does anyone know if such a list exists?

7 COMMENTS

  1. Good and pretty depressing post. I buy 3x$500 gift cards a month at the grocery store along with my other purchases. I put these on my Amex Gold for the 4x points. If this stops, I’ll likely just cancel the card, since there’s just not enough value to be had to offset the annual fee.

    • There’s a chance AMEX has added this wording simply to give itself the obvious authority to refuse to hand out points on gift card purchases at a later date and if (when?) things get out of hand, and it may not actively pursue gift card purchasers at this point…but I still think caution is advised.

      If I was in your position (and I fully admit that I’m not), I’d probably carry on as normal for a month and see what happens – you may be pleasantly surprised.

      If you get by unscathed it doesn’t mean that AMEX won’t come after you in the future but it does mean that, for now, you have more time to get value out of your credit card.

    • I’m no lawyer so I cannot give a definitive legal answer but it would appear that privacy laws don’t cover this aspect of credit car usage.

  2. When I gas up I sometimes purchase a $25 gas card for my kids a couple of times a month. I am not into MS and hope a purchase like this doesn’t set off the alarm bells.

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