Premium credit cards offer valuable points in exchange for hundreds of dollars in annual fees. One can use the points for premium travel experiences, hotel stays, and other lucrative discounts. However, if you’re not watchful, you might end up losing them (points) in a long-standing attack. We’re talking about the Amazon “Shop with Points” option, which is exploited in a scam to drain credit card points. What’s worse is that cardholders don’t realise that their points are missing until afterwards.
Amazon’s scam may secretly drain your credit card points
Jason Rabinowitz, an aviation journalist with Flightradar24, is a victim of this scam. In December, he realized that his Chase Ultimate Rewards points had dropped by a six-figure amount. “My points balance was almost entirely drained in a series of extremely suspicious incremental Amazon transactions that even the most basic of fraud detection algorithms should have spotted,” he said. He apparently discovered the scam much later when the points balance dropped.
The recent activity on his account reportedly revealed dozens of purchases on Amazon with the points he’d earned on a Chase Sapphire Reserve card. The attacker would still need Rabinowitz’s credit card details to make purchases for themselves. It’s possible the attacker could have got hold of the details through a data breach.
This is another reason not to save your payment details at online stores. He would have then added the card as a payment method to their own Amazon account, activated Shop with Points, and used them for purchases.
This is reportedly not unique to Chase
This is not a new trick in the books, nor is it unique to Chase. There are Reddit threads for American Express and Capital One cards with the same kind of fraud. When customers use Shop with Points to link their credit card rewards to Amazon, the company sends a notification to the rewards partner for every enrollment attempt, says Amazon spokesperson Josh Pflug in an email. This will allow banks to monitor for suspicious activity and alert cardholders if they detect potential fraud.
The statement also reportedly included a link to Amazon’s scam-reporting page, which has a category for losses in which customers never shared any personal/payment information with a fraudster. Amazon skips direct cardholder alerts, as they don’t know who the primary cardholder is on an account.
The points are fully restored
Card issuers can set their own notification policies. However, in Rabinowitz’s case, he hasn’t received any notice. Moreover, the fraudulent Shop with Points transactions also didn’t trigger any notifications. They didn’t appear to have triggered Chase’s own fraud detection mechanism either. Rabinowitz says that Chase has been good at detecting fraudulent charges when it’s the case of actual cash transactions. But there’s literally no mechanism to prevent fraud on the points.
Well, the good news is that Chase is quick to respond after Rabinowitz notified the bank. He notes that this entire point balance is back in less than a week. “The entire experience was upsetting because there was absolutely no notification that the fraud had happened, let alone anything I could do to stop it in the first place,” said Rabinowitz.
Though Chase’s description of its account protection measures doesn’t specifically cover transactions with points. A spokesperson confirms the policy extends to them as well.
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