American Express Problem...Will they cancel me?

[Drum_God]

@mhendo

Where did the OP claim to be buying something? What false representation did he make?

He transferred funds between two PayPal accounts. He didn’t attempt to hide it. He never claimed to be buying something that he wasn’t buying. And when Amex called him on it, he readily admitted that he had done exactly what his transaction records showed he had done.

He broke the rules of the cardholder agreement. You’re still a long way from establishing fraud in any legal, criminal sense.

Then I guess I have a fundamental misunderstanding of PayPal. (FWIW, I don’t have a PayPal account.) It is my understanding that PayPal is a service to act as an intermediary in purchasing products and services from individuals or small businesses via the internet. So, if I use PayPal A to send funds to PayPal B, then it could be reasonably interpreted that user A is buying a product or service from user B. In the OP’s case, that is not true as users A and B are the same person.

SoulSearching, your intentions were truthfully stated only after AMEX called you on it. I’m not suggesting that you should go to jail or some awful thing. It does seem that AMEX is well within their rights to choose not to do business with you any longer.

However, none of this is really my business, so I wish you luck and I will now return to managing my own financial affairs.

Won’t a casino throw you out for counting cards?

[Telemark]

@Drum God

Won’t a casino throw you out for counting cards?

But there’s nothing illegal or fraudulent about it.

You can transfer stuff from one PayPal account to another for any number of reasons. There’s nothing that requires the purchase of goods or services.

[mhendo]

@Drum God

Then I guess I have a fundamental misunderstanding of PayPal. (FWIW, I don’t have a PayPal account.) It is my understanding that PayPal is a service to act as an intermediary in purchasing products and services from individuals or small businesses via the internet.

Well, you can certainly do those things with PayPal, but that is by no means the limit of PayPal functionality. It is fundamentally a system for the transfer of funds, and PayPal doesn’t really care why you’re transferring those funds. It could be for a purchase, or it could simply be to pay back a loan or make a gift.

@Drum God

So, if I use PayPal A to send funds to PayPal B, then it could be reasonably interpreted that user A is buying a product or service from user B. In the OP’s case, that is not true as users A and B are the same person.

No. All you can infer from this is that User A is sending funds to User B. The reason for the transfer is essentially irrelevant. And as far as i know, PayPal has no rules against people having multiple accounts.

@Drum God

Won’t a casino throw you out for counting cards?

Absolutely.

But, as Telemark notes, there’s nothing illegal or fraudulent about counting cards. It’s simply against the casinos’ rules.

Some private businesses will ask you to leave if you’re walking around with no shirt or no shoes. Doesn’t make going shirtless and shoeless illegal.

[crazyjoe]

@Drum God

Suppose I have a credit card (not a charge card like AMEX). I already have a $1000 balance. The minimum payment due this month is $25. I’m short this month and don’t have the money. So, using my credit card, I send $25 to my PayPal account. Now my credit balance is $1025. The $25 “purchase” is in the thirty-day interest-free window. I withdraw the $25 from PayPal and pay the credit card’s minimum payment. Now my balance is back to $1000, I have made my minimum payment, and my credit history is perfect. I have borrowed the $1000 from the credit card largely interest-free. (Yes, the $1000 will accumulate another month’s interest, but I don’t care. I’m not really paying it anyway.) What a deal. Does the OP think that the banks haven’t thought of this???

Doesn’t quite work that way. Most credit cards state that if you are carrying a balance, there is no 30 day grace period. So next month you’ll pay interest on the two-cycle average daily balance of 1025 for x days, and 1000 for x days, etc. You’ll slowly dig yourself an early grave.

Still, though, this was the sort of thing that a 16 year old con-artist would think himself clever for doing. Someone experienced with credit should realize that this is exactly the sort of stuff that the fine print would take care of.

[arseNal]

Hmm, I don’t really see what’s the big deal. Suppose instead of sending the Paypal payment to his other Paypal account, he sent it to his brother’s, as a loan. Then when brother pays him back, he uses that money to pay back amex. It’s essentially the same thing as the original scenario, except he’s loaning himself the cash, which isn’t an unheard of thing to do. He pays the Paypal fees, amex gets their transaction fees, where’s the problem exactly? (The points really are irrelevant. He got points but they were worth less than the Paypal fees, so it’s not like he’s coming out ahead.)

I read about the factoring that was mentioned, but I’m not sure if this is the same thing, tho maybe I just didn’t understand it. I wonder what specific terms of use were violated?

[SoulSearching]

I am expecting a response as they conclude their review some time by week’s end and will post the exact decision. Still crossing my fingers, don’t really have another high limit card, it’s been tough.