Originally Posted by
Tailgater
Yeah, "fleecing" is probably too strong but I think the OP was using this term because the target audience (FT readers) relate very well to the horrible exchange rates Points.com offers.
That's my point. A bad deal doesn't equate to "fleecing"; it is merely something you should avoid. For that matter, points.com very low conversion rates are actually the best option for some people interested in quickly liquidating points they have no other use or desire for.
Originally Posted by
Tailgater
Yeah, I doubt that Points.com could be taken to civil court for its outrageous rates.
Anyone may be taken to court. To assert that a fairly disclosed and marketed bad deal would make them liable is preposterous.
Originally Posted by
Tailgater
Incidentally, another example of this kind of business are the Payday loan firms. Yeah, the users---er, probably most of them---volutarily enter into a transaction for a cash advance and sometimes pay just outrageous interest charges on a short-term loan (I still don't understand why usury laws don't apply to these types of loans).
High risk loans won't be offered unless high rates may be coupled with them. There is nothing "fleecing" about such arrangements, and the mere existence of silly usury laws doesn't make them inherently logical. Paying a very high rate makes perfect sense for some people, and it's a grave mistake for others. A properly-run business that offers a deal that some may foolishly use (while others wisely use) doesn't mean that business is fleecing; it simply means they are making money off some stupid people.
Originally Posted by
Tailgater
Okay, maybe "fleece" isn't the right term but "reamed, soaked" or something. Some foreign exchange outfits (especially at some airports) probably, one could argue, near "fleece" people who are naive about foreign exchange business.
No, they don't "fleece" either. They charge high rates that can be beat elsewhere. There's nothing immoral nor illegal about it. Someone willing to pay the rate or not willing to research alternatives first is responsible for their actions, as such outfits fully disclose their exchange rates. I just returned from London and I was in a situation where I found myself short-handed for cash, and despite knowing the many more frugal options available, decided to waste essentially $5 in conversion fees to save myself time and stress. Others might make the transaction not knowing better. None of us are being "fleeced".
Originally Posted by
Tailgater
Re the McDonald's scenario: well, if McDonald's started charging $50 for a cheeseburger, I think there would have to be rather huge flashing signs all over the place since, I imagine, many people just order w/o looking at the menu prices!
Not giving a customer full disclosure of the price being paid and/or a fair chance to remedy the situation if they are misled is a completely different issue than "fleecing" as it relates to a bad deal or exorbitant price. Any business should be free to offer products and services at rates that are unappealing to most, should they choose.
Originally Posted by
ghhamel
The "miles for cash" or "miles to pay for your ticket" are an absolute scam. While I don't remember the exact dollar or mileage amounts, last summer my wife and I were putting together a trip DFW/FRA/FLR/MUC/DFW. The booking was Lufthansa in business class. Quoted fare was in the $20K range for the two of us. AMEX was more than happy to suggest that I buy the tickets and they would use Reward points to pay for them at $.01 per point, meaning burning about 2,000,000 of my AMEX points. Instead I transferred about $250K Amex points to my CO OnePass account and used 10% of the points that AMEX was suggesting
Incorrect. You need a refresher on what "scam" means. A bad deal is not a scam, and in this case, Amex is not scamming because they clearly disclose the value you receive. If 1 cent per point is not a desirable return, don't use it. For that matter, 1 cent per point *does* appeal to many people who aren't inclined to use their points in a more lucrative manner. For example, someone with 10,000 points that are near expiration, who doesn't plan to use the airline much in the future, and has no interest in extending expiration and babysitting the account.