Originally Posted by
jsk1973
Agree with the last three comments. People seem to forget that the purpose of these sign-up bonuses is to get and keep new customers, not to simply hand out bonuses to people who barely meet the spending requirement and then put the card away, never to be used again, and move on to the next card.
Except you just described churners, and that's not who's been getting accounts shut down.
Who's been getting accounts shut down appears to be MSers, whose pattern is:
Get a card, get the signup bonus, perhaps stop using the card for a while, then suddenly do huge amounts of purchases, all from one store (one which happens to sell Visa/MC debit gift cards), then pay off all those charges with money orders or (in the past) billbay from Bluebird or Serve or such, and repeat.
The churners look harmless, and at most annoying, to the banks. They're easier to eradicate with anti-churning policies (like Amex's one bonus per so-called lifetime on personal cards, Citi's official no bonus except after 18 months of open or close, Chase's new policy against people who have more than 5 new cards opened anywhere within the last 24 months, etc) than by shutting existing card accounts down.
The MSers, on the other hand, sometimes can look (to a bank) exactly like money launderers or some other kind of fraudsters. You have to remember that the most of the people who evaluate accounts at banks don't understand miles/points collecting, and in many cases will never even consider that as a possible reason the activity they see on an account when someone is doing wild MSing.
And I use the term "wild" MSing because nowhere near every MSer is getting shut down, only some fraction of them.
Every MSer needs to think hard about how their account activity would look to a banker who knows nothing about points/miles colllecting (and thus doesn't even know that something like MSing exists).
Just as churners may want to think about how their account activity would look to the same banker. That's especially a concern with cards that don't require any spend to get the signup bonus (such as the Alaska cards from BofA); signing up, canceling, requesting a refund of the AF, and repeating, that's
theoretically a way to earn signup bonuses at no cost with an AF card like that, but if you try it, you're likely to quickly be blackballed by BofA. Take a advantage of the $100 credit (in many Alaska card offers) for $1000 of spend, even though that's not needed to get the signup bonus miles, and use that to offset the AF and have a bit left over, and suddenly your card usage pattern looks much better to a banker.