# Mint no longer accepting credit cards for $1 coins



## amamba (Jul 22, 2011)

I know some people have mentioned using credit cards to purchase $1 coins from the mint to get points. Now this will no longer be possible.

http://www.npr.org/blogs/money/2011/07/22/138610663/dollar-coin-loophole-closes-for-frequent-fliers?sc=fb&cc=fp


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## Ryan (Jul 22, 2011)

D'oh!


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## transit54 (Jul 22, 2011)

That's too bad. I was a big fan on this program and I circulated every dollar I received. I've tried to get these at my local bank, but they don't have them and I'm not interested in buying $250 or $500 at a time if I wait for them to be shipped and am not getting any incentive to use them. I find them more convient than $1 bills, it's just so hard to get ahold of them.


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## Trogdor (Jul 22, 2011)

I never did participate in the program. I'd have loved to order a box, but I wish you could get a "mix and match" set rather than 250 of the same coin.


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## Ispolkom (Jul 22, 2011)

I also never bought any coins from the Mint, as I was never comfortable with the idea of ordering cash through the mail. In any case, my credit union stocks the coins, and I buy a roll every few months. I mostly use them in parking meters, though I noticed on Tuesday that the CTA machines take them.

Even though I never used this gambit, I'm still sorry this program ended. Until now, whenever I pitched a hare-brained frequent-flyer mile scheme to Mrs. Ispolkom, I could always say in my own defense: "Well, at least I'm not buying coins." I'll have to come up with some other line now.

I'm surprised that the Mint program lasted as long as it did. I would have thought that it would have ended after Wall Street Journal article in December 2009, profiling Mr. Pickles and his millions of American Airlines miles.


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## John Bredin (Jul 22, 2011)

Ispolkom said:


> I'm surprised that the Mint program lasted as long as it did. I would have thought that it would have ended after Wall Street Journal article in December 2009, profiling Mr. Pickles and his millions of American Airlines miles.


"Mr. Pickles" sounds like he should be licking his fur and scratching around in a litter-box. :giggle:

By the by, why was this topic moved from Amtrak Guest Rewards?! :huh: Weren't people doing this coin shuffling to ring up AGR points on the Chase-AGR MasterCard, as well as on airline frequent-flier-linked cards?


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## Ryan (Jul 22, 2011)

They were. Didn't notice that it had been shuffled.


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## amamba (Jul 23, 2011)

Yes that is what I put this topic in AGR. Some people had mentioned buying the coins for AGR points. I am not sure why it got moved, as I do feel it is relevant to AGR.


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## Anderson (Jul 23, 2011)

Blast. Had I realized that this was possible, I'd definitely have "churned" coins myself for the points (and let us be honest: Intended use or not, I can't blame anyone for doing what is clearly a logical consequence of the policy which existed).


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## yarrow (Jul 23, 2011)

i got $250 worth a couple times. circulated them all. seems pretty dumb of an agency that wants to circulate the coins to cut off an avenue whereby some were circulated even if some were just taken to the bank


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## rrdude (Jul 26, 2011)

NPR just had a segment about this, seems a "few" people were REALLY churning this for "free" miles/points.

Story told about one guy who took his family to Hawai'i, all paid for with miles earned from buying / re-depositing coins. That's a LOT of re-depositing............


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## Trogdor (Jul 26, 2011)

There was another sort of hidden "scam" in this as well. For people with cash back rewards cards (say, 1% cash back), it would be like buying free money. For every box of $250 someone bought, they could get $2.50 back. If someone was able to take their family to Hawaii (how many FF miles are needed for a round-trip from US Mainland to HI? 25000-30000?), if they had a cash back card offering 1% instead of 1 mile per dollar, one could conceivably have made $250-300 in "free cash" if they wanted that instead of the miles.

It really was a complete scam when you think about it.


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## Long Train Runnin' (Jul 26, 2011)

Wouldn't the mint also have to give a percent to the credit card companies? This could have been costing them money.


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## transit54 (Jul 26, 2011)

Long Train Runnin said:


> Wouldn't the mint also have to give a percent to the credit card companies? This could have been costing them money.


Yes, but the cost of producing the coins is well below the value they sold them for. So my understanding is that the government made money on the deal via _seniorage_. That income may have been slightly less than distributing the coins via the federal reserve, but there are costs associated with that, too. My understanding is that the coins were being stored by the mint and by distributing them, they were also saving on storage costs.


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## Ryan (Jul 26, 2011)

transit54 said:


> So my understanding is that the government made money on the deal via _seniorage_.


You are absolutely correct. As a topical aside, seniorage is also the unspoken way out of the current debt ceiling debacle. All the treasury has to do is mint up a couple of platinum coins and call them $1 Trillion dollar coins. Transfer them do the Fed and boom, you're back in business. Sure, it carries the risk of some inflation, but that's probably safer than default.


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## sechs (Jul 27, 2011)

transit54 said:


> Yes, but the cost of producing the coins is well below the value they sold them for. So my understanding is that the government made money on the deal via _seniorage_. That income may have been slightly less than distributing the coins via the federal reserve, but there are costs associated with that, too.


The mint "makes" around seventy cents on every dollar coin, depending primarily on the cost of metal. The problem is, the Fed only orders coins when banks want them. Banks don't want these, as not enough customers request them.
So, even with the credit card fees and shipping costs, the mint was still making a pretty penny getting more of these coins out.


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## alanh (Jul 27, 2011)

Wow, I can hear the screaming from FlyerTalk.com from here. :lol:

But yes, churning is why getting some sort of cash or equivalent is the holy grail for miles/points collectors. I'm also surprised this went on so long, though it probably was because of the Mint's desire to get the coins out somehow.

I got a couple thousand over the years, but generally circulated them where I'd use cash rather than just depositing them.


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## Guest (Jul 27, 2011)

Ispolkom said:


> I also never bought any coins from the Mint, as I was never comfortable with the idea of ordering cash through the mail.


They shipped via UPS and required a signature if you ordered $1000. I think it was overnight as well. If you just ordered $250 you would get them through USPS in your mailbox. I wouldn't trust USPS with them either.


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## transit54 (Jul 27, 2011)

Guest said:


> Ispolkom said:
> 
> 
> > I also never bought any coins from the Mint, as I was never comfortable with the idea of ordering cash through the mail.
> ...


The threshold for UPS was $500.

Below that, they went FedEx Smartpost, with final delivery by the USPS. It wasn't the USPS that was a problem - it was FedEx Smartpost. The shipment would take over two weeks to arrive, with constant, inexplicable delays at or between each Smartpost sorting facility. FedEx Smartpost is the poorest service I have ever encountered (by contrast, UPS Basic, which is based on the same concept, works great). FedEx should be embarrassed to attach their brand to the service. They even they lost one of my shipments once. After a month or two corresponding with the mint and filling out paperwork, the Mint sent me another shipment, this time by UPS Next Day.


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