Be Careful When Using Debit Cards to Buy Money Orders to Earn Miles

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I’ve written earlier about debit cards which earn Alaska Air miles and which earn Delta miles.

In my experience, both of these cards earned miles when I experimented with buying money orders from different institutions as a PIN-based transaction.

To be clear – I do NOT recommend buying money orders and depositing it back into your bank account to earn miles.  Such activity is easy to trace, and in large amounts will be reported to the government, and there are reports of folks getting their accounts closed for this abuse.  Bank of America has blacklisted some folks from ALL of their products (bank accounts, loans etc.) including their credit cards which you may be able to get again (…and again).

Some of you will disregard this, but do so at your own risk.

But this could be a way to earn miles for genuine payments such as mortgage payments, student loan payments, or any payments where you write a check, but don’t earn miles and points.  This isn’t a revolutionary idea and such thoughts have been around for years.  Over the years, buying money orders with a debit card have earned miles and points, and sometimes they have not earned miles and points.

Terms & Conditions of the Debit Cards

Both debit cards appear to have restrictions in their terms and conditions against earning miles.

The card which earns Delta miles says (bolding mine):

Only PIN Point of Sale [POS] and signature-based purchases (including small dollar purchases that do not require a signature), Internet purchases, phone or mail order purchases or automatic bill payments qualify for mileage earnings. Cash advances, cash portion of a PIN POS sale with cash back, ATM transactions, payments for stored-value cards, wire transfers, money transfers, quasi cash, and traveler’s cheques do not qualify.

The card which earns Alaska Airline miles says (bolding mine):

We take the total amount of POS [point of sale] purchases for a calendar month and subtract any (a) credits related to POS purchases, (b) other adjustments to your deposit account related to POS purchases, (c) cash back from a POS transaction, (d)  (d) quasicash transactions, which are transactions convertible to cash and include the purchase  of money orders, travelers checks, foreign currency, cashier’s checks, gaming chips, and other similar instruments and things of value.

But in my experience – and I’ve done this for only ~$200 on each debit card – I have earned miles when I bought money orders at these establishments.

However, this could stop anytime since the terms and conditions are written to prevent earning miles for buying money orders.  In addition, this is likely unprofitable for the banks involved, and I suspect the ability to earn miles for purchasing debit cards is on its way out.

Unfortunately, I haven’t been able to buy a money order with a credit card yet, but let us know in the comments if you’ve been able to.

Where Can You Buy Money Orders With a Debit Card?

In my experience, you can buy them at many places including:

The Worlds Largest Retailer.  I went to the Money Center and bought  money orders.

Certain Grocery Stores.  I’ve personally verified this at the store below which is part of the largest grocery chain in the US.  Some grocery stores refused to sell me money orders with a debit card, but each store has its own rules, so ask around.

Some Grocery Stores Sell Money Orders

Post Offices:  Places where you send mail and buy stamps also sell money orders.

Gas Stations.  Some gas stations refused to sell me money orders with a debit card, but each store has its own rules.

The gas station below is part of the same large grocery chain above and sold me a money order with a debit card.

Some Gas Stations Sell Money Orders

I’m sure there are other places (drug stores, small grocery shops, etc.) where you can buy money orders with a debit card, so ask around.

Be Careful

Buying lots of money orders will arouse suspicion – at the banks and at the places you buy them from.  That’s because anyone can buy money orders and deposit them in banks and “launder” money.

If the banks get suspicious, they may file a Suspicious Activity Report to the Financial Crimes Enforcement Network.  Or they may shut down your account without allowing you to explain the transactions.

Standard Chartered just paid $340 million to settle a money laundering charge with regulators so the stakes are high with banks likely to shut down activity which they feel is too risky.

In addition, most sellers of money orders will ask for identification and take down your social security number, driver’s license and other identifying information if you usually attempt to buy more than $3,000 in money orders at a time, and most will not sell you more than $10,000 worth of money orders a day.  But you shouldn’t need such high limits if you use them for genuine transactions.

Bottom Line:  Using debit cards to buy money orders to pay your babysitter or to pay your mortgage or student loans could be worth it to earn milesBut be careful and know that the repeated purchasing of money orders can be suspicious and that you could have your bank account closed.

Tomorrow, we’ll look at other ways to transfer money and earn miles with debit cards, without leaving the house.

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These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

44 Responses to Be Careful When Using Debit Cards to Buy Money Orders to Earn Miles

  1. iftheyonlyknew

    which debit cards are eligible for this? I am with bank of america

  2. Msp2anywhere

    Gasoline. Fire.

    Didn’t we cover this in class last week?

  3. Why would someone purchase a money order and then deposit it back into the same account in which they purchased it from (ST/BOA)?!?! That is just asking for trouble — if you want to do this couldn’t you just deposit that money order into another bank account. How could ST/BOA track whether you used that money order to pay for your babysitter or if it went into another account?

  4. I have $6000 left on my car loan and for the longest Ive been trying to figure out how to pay this off by using a credit card/debit card since I already use my credit card for every monthly purchase. I cant do it on chargesmart.com but if my bank accepts money orders should I purchase monthly money orders to may payments on my car? I have a rewards debit card and mileage credit card.

  5. Can’t you use money orders to buy coins from the mint?

  6. It’s a trap!

  7. Do you think comparing laundering money for a country’s banks in violation of economic sanctions is in the same league as buying money orders with a debit card? This seems a bit of a stretch.

    I’m with Msp2anywhere on this one.

  8. @Matt – Money order purchases AND deposits in large amounts will attract suspicion because they it is easy to convert cash into money orders.

    @Unrea - You maybe able to buy a money order to make the monthly card payments on your car.

    @Scottrick
    – The point is that the banks have a great incentive to shut down ANY activity which they feel is suspicious, because the penalties for letting something slip through are very high.

  9. so theoretically, if I had the ST card and I bought a money order, I could pay my monthy co-op maintenance with it, without attracting attention – and get 25,000 miles?

  10. Really? Didn’t you post this last week. Wow talk about regurgitation, and Blog deleted.

  11. @MMS…I agree but they can’t track the deposits if you deposit the money order in a different bank account. So what proof would ST have if you purchased a MO from (insert store name) and deposited that into any bank account outside ST?

  12. Wow, you’d think that after all the comments from last week you’d get the point. Good way to drive traffic to your site but you got one less reader here.

  13. Broken Link: ” been around for years. “

  14. I wonder how many times in a week “guest” and “guest2″ are going to threaten to stop reading your blog, whilst obviously still reading your blog. ;-)

  15. @Kathy K – You’ll get shut down. I tried something similar. Apparantly, Walmart codes these transactions slightly different from merchandise or services rendered, and they found out that this was buying money orders. Account was placed “Under Review” and they want all these forms filled out. Kinda like an AMEX financial review

  16. @guest2 : It’s “fewer” reader, not “less.” Sheesh.

  17. what institution are you referring to from the Walmart coding?
    also, while useful this information is best not talked about, as we all know these blogs are read daily by the banks.
    finally, 40M is really not alot of money for many mega banks if the activity is profitable (which this is not)

  18. @Kathy K – If your monthly co-op payment is 25,000 (to earn 25,000 miles) you will attract lots of attention by buying a money order in that amount (and I suspect many places will not sell such a large amount).

    @guest @guest2
    – This post mentions an additional card and 3 different places to get money orders, so it is a bit different. But if you’re not reading in future, you won’t be upset at future posts!

    @Matt
    – The bank in which you deposit the MOs could get suspicions at repeated high value MO deposits.

    @David0603 - Thanks! I’ll fix it.

    @Chris M. – Hopefully they really will stop reading, and we’ll have less drama in future!

  19. @Chris M. – Hopefully they really will stop reading, and we’ll have less drama in future! ~ LOL
    “What is drama but life with the dull bits cut out.” ~ Alfred Hitchcock

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  21. Hey Guys there is One more bank which gives American Airline miles .
    May be a Less Known Bank, for every $2 you spend you get 1 mile.So if you run out of Suntrust
    http://www.ufbdirect.com/ufbdirect/personal-banking/checking/airline-rewards-checking.aspx

  22. @Nikhil – Thanks for the tip. I’ll look into it!

  23. Which Bank Dept card earns Delta miles? Thanks

  24. @Nikhil – That’s exactly the name of a bank I had an account with and that went bankrupt last year (I think). They had to be bailed out by the FDIC.

  25. Do you know if we can buy money order with wells Fargo debt card? Or the one also called pre-paid card?

  26. hi Million Mile Secrets,

    what is your opinion about ufbdirect’s airline debit card?

    i also heard that the deal of buying MO at walmart with ST debit card is dead, are you still able to do that?

    thanks.

  27. @Claire, ufbdirect was bought by another bank, Bank Of Internet, so same brand but different company now

  28. @Josinei – I believe you can!

    @allen
    - I haven’t bought a money order from Walmart for a while, but I believe you can still do it. I haven’t tested that debit card as yet.

  29. FYI – The Large Retailer limits the size of its MOs to $1K per. Anything larger would require multiple MOs to be purchased.

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  33. What if there was a service that would charge your credit card plus a 5% fee and send you either a money order or money transfer? Would that work?

  34. @Drew K – Thanks!

    @Lorne - It would work for minimum spending requirements, but I wouldn’t pay 5% on a regular basis to earn miles and points!

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  36. I am new to this game so I apologize that this may be a stupid question. In the posts above, I clearly know that MO refers to “Money Order”. However, I am not sure what ST means. Can you clarify? A lot of info to absorb but very interesting.

  37. @Anne L – ST = Suntrust, the bank which issues the Delta debit card.

  38. Pingback: Delta Skypesos with Suntrust - Giddy for Points | Giddy for Points

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  40. So is this stuff still valid? I see they were from 2012. I’m just learning about all of this, didn’t think about it before. Can you still use debit cards for money orders? Can you use debit cards for paying bills at Walmart? Can you still buy the reload cards with credit cards? Can you load the Amex Blue Bird account using a debit card directly at Walmart? Can you use any debit card? Could you use the prepaid cards to load the BB account? Trying to see how i can get points/miles with the existing card I have. I haven’t applied for new ones yet to get the opening miles offers. Thanks.

  41. @Charles – It still works and you can use debit cards to pay bills at Walmart. You can buy Vanilla Reload cards from CVS with a credit card and then load to your Bluebird. You could use debit cards at Wal-Mart to load your Bluebird as well.

  42. Jonas Kurniawan

    Dear Daraius,
    I heard that CVS refuses to allow purchase of Vanilla Reload with credit card, it’s been a few months if I am not mistaken, could you please clarify on that?

    Will this work, Say if I buy a pin-enabled gift card or Amex gift card and use them to fill in Bluebird account or just to make money order to a certain individual? This way I can fulfill a minimum spending for a card by paying for something that doesnt accept credit card and having all the legitimate reasons in case I get financial reviewed by Amex. Thanks.

  43. @Jonas Kurniawan – AMEX cards don’t have PINs so you can’t load them to load to a Bluebird. It is getting harder to use gift cards to load Bluebird, so I’d buy a card in a small denomination and test it first.

  44. Pingback: Simon Mall Visa Gift Cards Could Save You Money Loading Bluebird! | Million Mile Secrets

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