Would it even work?

I'm new to this game, so please excuse me if this is a dumb question.

Suppose I were to make a purchase of $5k for furniture at a local store, and paid for it with my xxx airlines credit card, therefore earning 7500 miles. Then a few days later I changed my mind about the purchase, but had the refund credited to a different credit card (one that is with my primary bank). I could then just do an on-line transfer of the positive balance on my credit card to my checking account, and pay the xxx airlines credit card balance off.

Net result...no money spent, no interest paid, 7500 more miles.

FWIW, I work for a retailer of high ticket items, and we NEVER check to make sure the refund is going onto the same card that was originally charged...we only verify that's it is the same person.

So, what do you think?

I would think so - perhaps not under criminal codes but certainly against the T & C that your airline issues

If you have to ask...........................

why don't you do it at your own workplace then?

some merchants have the CC information stored on their terminals where they don't need to swiped the card to issue a refund. they just look at it to verify it is the same card, and some don't (like the company you work for).

as for fraud, dictionary.com reads:

A deception deliberately practiced in order to secure unfair or unlawful gain.

take it for what its worth

It is, in my opinion, certainly not illegal. Whether it is morally acceptable, only you can say.

btw, it isn't fraud, because you aren't decieving anybody (unless their is a rule that the refund must be made to the credit card used for the purchase. If there were such a rule, you may be defrauding the business, but you are certainly not defrauding either credit card company or the airline.... at least not directly. Credit card company a still gets the money for the purchase and for the miles that the airline bought, credit card b gets the credit refund. The only problem would be the fees, which would still be carged to the merchant by credit card company a. I also have a feeling that the credit card company might not accept a refund credit from a store that never made a charge to the card.)

Go for it. Just make sure you post your results here. Never mind the things that could go wrong like:

It's not that easy to get your balance refunded from some credit card issuers. It might not be as easy as you make it sound, particularly if they think you are playing games with them. Which, of course, you would be. It may be your bank, but it's funny how banks get when it comes to their money.

I know if I were a furniture store (or whatever kind of big-ticket retailer you want to use) and had someone come in and want a large refund just like that, I might not make it that easy for you. Your company might not either if the sales guy - whose pay is based on commissions from sales like these - had some say in this.

There might be some fine print that people may resort to when they feel they are getting screwed.

Just keep us posted so we can all get a good laugh.

I'll go with legally permissible, but morally dubious. Being able to do an act legally doesn't justify it morally. That said, I'd consider it on the minor side of immoral.

From a practical standpoint, how will you get the furniture store (or whatever) to refund the $ on a different card? Most vendors won't do this, precisely to prevent scams like this one. (Believe me, there'd be a million people trying this if it'd work.) tls

I'd have thought that the processing fee the retailer has to pay the credit card company when you make the initial purchase is not properly refunded if the credit is applied to a different credit card so someone is loosing out somewhere.

More importantly though, do you earn the FF miles as per each transaction or as per each months total balance? If you earn per monthly balance the total miles earned might make this process futile as when the balance transfer occurs you'll surly be loosing the same amount of miles? Maybe your CC doesn't allow subtraction of your FF miles though?
for example, when I had a refund placed onto a credit card which earnt me points the negative value of the transaction meant I lost those points - they actually subtracted them off my loyalty account - this was despite never even earning points on the original purchase as the points scheme hadn't begun at that time!

Secondly,
although you'll have a different credit card, there was a situation on my card once where the card company ran a double miles promotion during a set month. This was based on the total balance at the end of the month. When I had an item refunded the next month (after the promotion ended) I only lost points at the normal rate. So, If I'd thought about it earlier, I could have bought many things and refunded them after the promotion to earn miles for nothing - so look out for promotions like these.

Two words. "Money Laundering". What you are proposing is against the law. Merchants are not allowed to process refunds on Credit Cards to a different Credit Card or to give the Refund in Cash or even a check. If you can find a Merchant that will allow it, be prepared for the consequences.

(Of course if you can find a Lawyer to defend you that takes Credit Cards and/or Gives Miles???)

Completely agree. To the OP: If this was feasible, it wouldn't be illegal. But processing refunds where they are not due is not legal. For example, if your company bought a chair and you paid for it on your companies credit card, but you decided you didn't like the chair and want to pocket the cash. You can then refund the money to your own credit card. This is just 1 example of why money has to be refunded in the original form of payment not to mention the 1,000 other logistical issues.

Cheers

Coming from your American view point this is probably correct. However, the OP never posted where they live or where the local store is.

So in your city or maybe even in the US it could be considered "money laundering", however, each merchant can give the refund in any form they want. It is the merchant that has come up with the policy to only refund it to the original form of payment, this reduces the losses to the merchant. There is no goverment interference dictating how a merchant can process refunds. I have paid with a CC in several locations and when there was a guarantee or an overcharge had the difference refunded in Cash. I think it would be a stretch to say that the USPS or a major grocery store chain was laundering money because I made a purchase with a CC and got a refund in cash.

Are there costs to others, most definitly. The store has to pay the CC fee, the CC has to buy the miles from the airline. But is it illegal or fraudelent, NO! Immoral, could be . Money Laundering, definitly not! A very difficult and time consuming way to earn miles that could have a "catch" to it, most definitly.

Money laundering?! The OP is talking about making a charge on one card and receiving a credit on another -- each card is his personally. Money laundering is about cloaking the source of ill-gotten funds. The OP is talking about buying and returning some fricken furniture.

How do you refund to a different credit card? I was always told that it'll be credited back to the card you used to purchase, even if you don't have the card with you. ??

Right. I don't see how you could call it "money laundering" unless I'm missing something.

As to whether "Merchants are not allowed to process refunds on Credit Cards to a different Credit Card," I'd like to see the authority for that statement. I know most *won't* but I'm not sure that means they can't.

(A while back I had a refund coming on a charge that was made quite a while earlier to a card I had cancelled in the interim, and the merchant said it was no problem, that he could refund the credit to any card in the same name as the charge. I gave the merchant the number of one of my current credit cards and the refund posted without problem. And the card the refund came on was a different brand of card than the one I had made the charge on.)