(Updated) Is American Express On A Shutdown Spree? Reports are Coming In!

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American Express has been Shutting Down Accounts

American Express has been Shutting Down Accounts

Over the last few days we have seen 3 reports of American Express shutting down entire accounts in our Facebook Group.  And 2 of the 3 were not because of sign up bonus abuse.  This is somewhat new territory since it has always been thought that once you got past the initial sign up bonus you were in the clear.  It doesn’t seem to be that way anymore.

Shutdown Details

Shutdown 1 & 2

The first report had the Facebook group member as well as his friend’s accounts shut down.  He believes they got linked because he had referred his friend for a few cards.  His friend didn’t MS much at all but he did for his most recent sign up bonus. The friend was running out  of time to complete the minimum spend and decided to buy a few gift cards.

Now I am not sure if that linked back to the Facebook member since he referred the friend for a bonus. That could be the case since we have heard about accounts being frozen because of referral bonuses.  The referral could have put eyes on his account.  He did say he had been buying gift cards at office stores with his Simply Cash card.

Shutdown 3

The next report of shutdown came in the very next day.  He was told that American Express had made a business decision and that they had decided to terminate his accounts.  They wouldn’t give more detail than that.

It sounds like there are a couple of different things that could have led to this shutdown. He admitted to heavy levels of ms in previous years but not much this year.  He did say he hit Old Blue Cash hard the last few months before his cardmember clock reset trying to hit his $50,000 cap.  The spike in spend could have put eyes on his account.

He also said that he paid his credit card bills with money orders sometimes, don’t do this!  Although he said that he had been doing this for years the increase spend may have had them look deeper at his accounts. If that was the case I can guarantee they didn’t like seeing money order payments.

UPDATE – Data Point 4 & 5 From Facebook Group although these are more Sign Up Bonus related.  But it sounds like Amex is getting more sensitive there too.

I know of two more cases 1: Hilton Business card: 100K bonus was not awarded as Amex claims the young lady was gaming the system. All her spend was organic and mostly at Tom Thumb. They kept asking her about GC purchases and she insisted that she did not buy any. Account has gone under review after her last conversation with them. 2. Amex Business Platinum: This guy is a member since 81-82 and 80% of his spend was organic with some GC purchases from the regular outlets (CVS/Ebay). Welcome bonus not awarded and account(s) shut down.

There is also a 6th data point in the comments section.

Conclusion

In the past we have always suggested steering clear of anything but traditional spend on American Express cards during the sign up bonus period.  It seems like it may go a little further than that these days.  Banks are cracking down all over the place so you have to play this smart.

Don’t have massive spikes in spending, have a good amount of regular spend mixed in on all cards, and don’t make payments with anything but your checking account.  You may wanna use Amex cards for traditional spend only going forward if you value the relationship.

 

If you have any recent stories please share them in the comments.  We need more than 3 data points to be able to see if this is a growing concern or just a blip.

 


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42 COMMENTS

  1. Mark, how do you reconcile limiting AMEX to traditional spend with your recent endorsement of buying gift cards at grocery stores with Hilton Ascend?

    • David I guess you an I have a different definition of endorsement. No where in the article did I even mention purchasing gift cards. A commentor brought up buying Visa gift cards in the comments. This was my response:

      You would be best sourcing the gift cards from the grocery store since it earns 6X and then you earn the free night too getting a return of over 4% per dollar. There is always a chance that Amex RAT will deny the 15K free night purchasing gift cards from grocery stores but that hasn’t been the case so far.

      I gave him information and a warning. None of the data points in this article change that fact but if you are risk averse you should avoid it all together. It seems like Amex is ramping up their investigations. I simply provide information and people are able to make their own decisions. That article was about using the Ascend as a non bonus spend card.

      Thanks for the comment David – I hope I cleared that up for you.

      • My follow up comment to another commentor

        There have not been any reports of issues with it – but that could always change with Amex these days

        • Thanks, Mark. Was just looking for a further explanation of your thoughts. Like HoKo I’m trying to gauge where the line is here, but it’s obviously very murky and nobody can say for sure.

          • My pleasure – I wish I knew where it was but we are all looking for the light switch in the dark at this point 🙂

            It seems like they are way more sensitive these days but it is hard to tell where the line is. Hopefully everyone keeps sharing data points so we can get a better picture of it.

  2. I’d still say that even though these reports show that banks are getting stricter, I still think that 90% of us won’t be affected. I love miles and points, and don’t do MS. I keep getting some really good offers from both Amex and Chase and put a lot of genuine spend every month. I’m guessing my profile would be quite similar to a lot of other people who love points and miles and play this game avidly. I guess we have to not panic – since there’s a clear line between MSing and doing actual fraud versus just getting the best sign up bonuses at the right time by playing by each bank’s rules.

    • I think most people will be ok but for the people that do heavy MSing they have cause for concern. I know a lot of people have been hitting SPG hard before August.

  3. This may tick-off some…but Good!!

    People who abuse the gift of CC bonuses should get repercussions. Hogs get fat, PIGS get slaughtered. I’m fat with miles & points, but never been slaughtered because I *use* the system and don’t *abuse* the system.

    • These aren’t from abusing bonuses though. Amex has been changing the rules of late. What they used to be ok with isn’t flying with them so much anymore.

    • I’ve seen a lot of cases where even the fattened pigs got slaughtered with the hogs when CCs start the purge. A lot of times, CCs make new rules to justify the purge and their decision can be final.

  4. Ugh, I was the guy commenting on the Ascend article about being very tempted to do some grocery store MS to earn 6x and the free weekend night. On one hand I know first-hand people that are absolutely going crazy on various amex cards with MS but then there are reports like this that give me serious pause.

    Seems like it’s just a crap-shoot and the differentiating factor is just whether or not a human being happens to look at your account.

    • For sure a crap shoot. I think if it is minimal (a few here and there) I would say you would probably be fine but the truth is no one knows what triggers anything at this point.

      • Yeah I was thinking maybe 2-3k per month, nothing too crazy.

        Also, I wanted to say that I find these sort of posts very helpful. Of course it’s just anecdotal but I find it useful for calibrating the overall risk environment we’re operating in.

        • I agree I think making people aware of things is a big part of our job. Informed decisions are the best decisions

    • I checked the FB post again and have corrected my post. He was just trying to hit the 50K cap before his year reset.

    • The change I’ve seen on OBC is we can now redeem all our Reward Dollars up to the last cent although min redemption remains at $25. In the past, we can only redeem in increments of $25 leaving “orphaned RD” sometimes just a few pennies off $25 🙁

  5. I got entire amex shut down this month. Amex shut down your accounts as they notify you that your entire amex account canceled.

    I just do MS on my amex

    Good luck, people. Amex enforced the T&C

    • Can you elaborate on the details:

      -Did you have large balance of MR points? Did they confiscate the points when they closed your accounts?
      -How many cards did you have
      -Which cards were you doing MS
      -What sort of MS (Simon, grocery store, GCM, etc.)
      -How much $$ per month in MS per card were you doing?

      Thanks!!

  6. Three data points make a trend? Please.

    It’s a well-known fact that one of the individuals in Shutdown 1/2 have been less than forthcoming in their story and they’ve had issues with other aspects of human interaction within this space. An Amex shutdown is par for the course they’ve set themselves up for.

    Any further ‘data points’ from such a limited scope of incomplete information reminds me of the hard-hitting journalism behind the likes of The National Enquirer or Star.

    • There is another data point in the comments that was shut down for the same thing. This is new with Amex…in the past once you got past the sign up bonus it was assumed you were safe. I am sorry that you don’t find new data points that contradict past results worthy of a post. I think many do. A big part of posting this is to hope to gather further data points.

  7. I have some updates. I called Amex and essentially did not give explanations. I talked to 2 people from different departments and …just no explanation.. but I did get my MR transferred out to an Airline when they transferred the call to MR department. What I didn’t get is the $800 left on OBC. . The annual fee I payed will be prorated and either credited back or they will send me check… Its really hard to live without centurion.

    • Is the $800 in your OBC acct from earned from last month and has not posted as available? If that’s the case, I remember back in Oct 2014 during the massive OBC purge, people who got the axe kept calling until they got a sympathetic rep who were able to cut them a check for their rewards dollars so even if they were shutdown, they got their RDs. It may not be a loss if you can spare time to HUCA and find an agent willing to help you.

  8. One more DP, all my accounts were shutdown this week. All existing MR transferred out, all OBC CBs were cashed out in the same day receiving Amex call. However, no AF refund per customer support. SPG points were credited to SPG account after statement closed later on. No luck for MR and other CB earned from the last statements.

          • IME, I don’t think so; there must be something in accounts that trip the alarm for rats to look carefully.

            I continue to MS 100% on 3 OBC accounts and have not encountered issues, no FRs either. I do NOT cycle my CL since they gave me substantial CL and with cap of $50K, no need to go hog in just a month or two to reach it.

            I noticed since the PO disallowed all VGCs for MOs in Nov 2017, a lot of MSers quit buying vanillas from drugstores. Aside from VGC fees they raised to $5.95, most, if not all MSers found other places to buy their VGCs that can be drained at WM and grocery stores.

  9. I was shut down without explanation (other than it being a internal business decision) a couple of months ago a few days after redeeming 600k points on United international flights for myself and 4 family members for which I would be eligible for 50% points refund due to the Amex biz plat. I have been with Amex for over 15 years, never manufacture spend (ALL my spend is a million percent legit both personal and business expenses), and I pay my bills in full every month 100% of the time. I called day after day multiple times a day and was talking to a brick wall and getting no info. I finally decided to write an email to corporate and also to file a claim with the BBB. Within 10 days ALL of my accounts were reopened and my MR points were reinstated (and I got the 50% points back shortly thereafter). I still do not know and was never told why I was shut down in the first place.

    • Wow that is a crazy story – thanks for sharing. I have no idea what would have caused it. I am glad you were able to get them opened again. Are you transferring out your points regularly now?

      • No, unfortunately not, although I probably should, but I’m having a hard time deciding where to put them. I had not used my MR points for awhile (although I was earning them very nicely through spend my Amex Plat and Gold cards), so I thought that maybe using 600k points at once via Amex travel was the trigger, however those points were earned fair and square through 100% legit spend and it would be disgusting of them not to let me use it. Maybe they didn’t want to have to give me the 50% points back… They would not tell me anything other than a letter stating that I was not using my account for it’s “intended purpose”, whatever that is supposed to mean because all I was doing was charging personal and business expenses same as I had been doing for the past 15+ years in a very consistent manner.

        • I could see an investigation getting started with a massive redemption but you wouldn’t think they would do a shut down.

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