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AA potentially closing accounts due to credit card churning/churn

AA potentially closing accounts due to credit card churning/churn

Old Dec 3, 19, 10:13 am
  #61  
 
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Originally Posted by DMPHL View Post
IP addresses, mileage redemptions, etc.

Not to mention getting on the phone with their partners at Citi to ask what individuals have multiple credit card accounts open, and seeing what AAdvantage accounts those link to.

I can't imagine it's very difficult at all.
Yep. Between them, AA and Citi have all the information they need to know who's creating fake accounts and racking up miles. Not difficult at all.
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Old Dec 3, 19, 10:16 am
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Originally Posted by DMPHL View Post
Not to mention getting on the phone with their partners at Citi to ask what individuals have multiple credit card accounts open, and seeing what AAdvantage accounts those link to.

I can't imagine it's very difficult at all.
One might presume that such a database query is easy. But years of evidence suggest that Citi's IT is either too incompetent to do this or they've been instructed to look the other way. Or both.
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Old Dec 3, 19, 10:23 am
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Originally Posted by aradisc View Post
One might presume that such a database query is easy. But years of evidence suggest that Citi's IT is either too incompetent to do this or they've been instructed to look the other way. Or both.
I think it is safe to assume Citi has performed an ROI on the offers - and those that game the system - and decided the return is good enough to do nothing about it.
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Old Dec 3, 19, 10:59 am
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Citi may have decided that it doesn't care, but that doesn't mean AA has decided it doesn't care (or hasn't changed its priorities) or that Citi wouldn't cooperate with AA if asked.

Multiple account openers may be fine. Or not. Hard to say based on general principles.
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Old Dec 3, 19, 11:02 am
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Originally Posted by Global321 View Post
I think it is safe to assume Citi has performed an ROI on the offers - and those that game the system - and decided the return is good enough to do nothing about it.

I imagine that was also the sentiment at Wells Fargo. Until it wasn't. Slightly different nuance, but very similar. Creating fraudulent accounts for profit and execs/others turning a blind-eye didn't end so well there.

I'm not a saint, by any stretch, and happily salute the lines of grey. That said, the greed and arrogance on the other thread appalls me.

Posters bragging -- BRAGGING - about creating multiple AA Frequent Flyer accounts, with slightly different names (i.e., "Bob", "Bobby", "Robbie", "Robert") using new email addresses, to get credit card sign-up mile bonuses. Bragging about holding 3-10 FF accounts at anytime, and turning some % of them over every 35-65 days for new sign up bonuses because Citi will approve them at this frequency. Bragging about opening a received offer in two different browsers at the same time, and somehow by doing this, able to get twice the bonus miles. And stating they're going to keep right on doing it until AA or Citi cuts them off.

The math is easy on this. With 5 accounts - turning even every two months - with say 50K miles signup -- pretty nifty little payoff of 1.5M miles per year. Times how many people. It's only a matter of time before this story makes it's way out of forums and blogs to mainstream media. And AA will want to clean it up as much as possible before then. This particular Gravy Train is all but over. In my humble opinion.
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Old Dec 3, 19, 11:12 am
  #66  
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I guess this is what happens when executives clamor for sales in an already heavily saturated, hyper mature industry. Citicorp in order to make the numbers freely takes on new cardholders that are clearly churning credit cards for miles. The stats look good and everyone is happy, including the people flying around in International J class without spending a dime. Everyone of course but the airline.
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Old Dec 3, 19, 11:16 am
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Originally Posted by aradisc View Post
One might presume that such a database query is easy.
It is. I do that kind of thing all the time. I have no fear of big data.

But years of evidence suggest that Citi's IT is either too incompetent to do this or they've been instructed to look the other way. Or both.
I wouldn't blame the brilliant, patient, virtuous saint-like folks in IT. (Full disclosure I work in IT as a database admin.)

I'd blame, instead, the idiots in management.
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Old Dec 3, 19, 11:53 am
  #68  
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Originally Posted by newyorkgeorge View Post
I guess this is what happens when executives clamor for sales in an already heavily saturated, hyper mature industry. Citicorp in order to make the numbers freely takes on new cardholders that are clearly churning credit cards for miles. The stats look good and everyone is happy, including the people flying around in International J class without spending a dime. Everyone of course but the airline.
The airline has 100% control over their international J award inventory and the resulting pricing. If they're not happy, uh, don't make awards available? Jack up the prices?

Oh yeah, they fixed that...

AA Anytime / AAnytime award / awards [master thread]
MileSAAver / SAAver award reduction / scarcity discussion
AA - Dynamic Pricing STINKS (Award Scarcity & Inconvenience)
More award availability restricted by married segments / connections
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Old Dec 3, 19, 11:59 am
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Don't misunderstand my question - it is an honest one.

Who loses when these guys create multiple accounts? Don't the cc companies buy those miles? And doesn't that mean AA expects them to be used?

So AA got paid, the cc company clearly seems happy, so who loses?

Again, I hope every one of them loses their miles. The rules are the rules. Better for us rule followers.

I am just trying to understand who, if anyone, is out something; besides the scammers when their accounts are shut down. I don't know the behind the scenes revenue story.
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Old Dec 3, 19, 12:19 pm
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Originally Posted by newyorkgeorge View Post
I... Everyone of course but the airline.
Huh?
They sold the miles to citi and probably profited the most out of this..
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Old Dec 3, 19, 12:19 pm
  #71  
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Originally Posted by wiivile View Post
There's a difference between getting 30 AA cards from 1) mailers in your own name, 2) using other (real) people's mailers, and 3) creating AA accounts for non-existent people to get more mailers. I would have drawn the line at using mailers not addressed to me. I'm happy to get 30 AA cards as long as the mailers were in my own name. And Citi/AA can't really do anything about that aside from tightening up approvals and/or bonus eligibility going forward.

But using mailers not addressed to me is going too far, even if it's a real mailer to a real person, because they're technically non-transferrable (whether given to you by a relative or obtained by dumpster diving).

Making AA accounts to generate mailers to fake people is definitely going too far and is borderline fraudulent. Using other people's legitimate mailers is not fraudulent but simply a violation of the non-transferable terms.
How do you open a credit card in a fake name? You'd need to have a credit history and social security number. Or were people opening FF accounts and credit cards somehow in the name of some different real person (identity theft) but not leaving bills and of course knowing how to log into the FF account to "gift" award tickets to themself in their real names? This could come from dumpster diving to get the name/address of a real person who had received an offer, but getting the social security number and enough other information for the credit card application shouldn't be easy for an amateur.

If people were using variations of their own real names (nickname/initials/middle name/etc.), they would need to use their real social security number so the accounts would be linked at the bank even if AA doesn't ask for a social security number when one opens a new FF account. With Citi's cooperation, it would be easy to find the duplicate FF accounts if Citi provides a list of all credit card numbers (perhaps over some low threshold to allow for legitimate multiple credit cards to be linked to a single FF account) associated with a single social security number.

To the extent that identity theft or fraud were committed, this would be criminal and not just a matter of violating FF program rules.
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Old Dec 3, 19, 1:02 pm
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Originally Posted by Global321 View Post
Don't misunderstand my question - it is an honest one.

Who loses when these guys create multiple accounts? Don't the cc companies buy those miles? And doesn't that mean AA expects them to be used?

I am just trying to understand who, if anyone, is out something; besides the scammers when their accounts are shut down. I don't know the behind the scenes revenue story.
I don't know, either, but if AA felt that the volume of miles awarded to AAdvantage accounts operating this way—or the prospect of the number of miles awarded this way growing even more in the future—would be a liability they weren't willing to take on, then they may may have decided now was the time to shut it down.

And, yes, they may have decided that it was also not great for the AAdvantage program if people who spend money to fly the airline frequently can't redeem their miles because of churners. And don't forget, it also decreases the value proposition for legitimate credit card customers. If regular customers aren't getting value from their Citi or Barclays cards because they can't use their miles, that harms those products in the future.
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Old Dec 3, 19, 1:04 pm
  #73  
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Yeah, count me as someone who doesn’t *really* understand what has been going on, but I haven’t come across that “other thread.”
What is this churning doing to people’s credit scores?!
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Old Dec 3, 19, 1:09 pm
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Originally Posted by azepine00 View Post
Huh?
They sold the miles to citi and probably profited the most out of this..
Does anyone know what Citi pays AA for miles? Just guessing, maybe something less than one cent per mile. I can see scenarios where someone can land an outsized premium cabin international award flight which costs AA a whole lot more than what they got for the sale of those miles from Citi.
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Old Dec 3, 19, 1:25 pm
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Originally Posted by MSPeconomist View Post
How do you open a credit card in a fake name?
From skimming down the thread in the credit card sub-board, it seems like someone figured out that a) opening up a new AA frequent flyer account generated a credit card offer with a good sign up bonus but that b) that sign-up bonus offer code was single use but not tied to a specific FF account. So they'd create multiple frequent flyer accounts under fake names where the credit card sign up bonus offer post card or e-mail was generated, and then use the code from the postcard to get a new card under their own name with their own SSN. And Citi was okay with these 'targeted' offers despite limiting general sign-up bonuses for that kind of product.

Until someone at Citi or AA seems to have decided it wasn't okay anymore.
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