Dollar Coin Loophole Closes For Frequent Fliers
The U.S. Mint said today it will no longer accept credit-card payments for dollar coins purchased from its website. Too many people were using the program just to get frequent-flier miles.
In a statement today, the Mint said:
The Mint has determined that this policy change is prudent due to ongoing activity by individuals purchasing $1 coins with credit cards, accumulating frequent flyer miles, and then returning coins to local banks. Local banks, in turn, returned coins to the Federal Reserve. While not illegal, this activity was a clear abuse and misuse of the program.
The Mint noticed the problem back in 2008, and put limits on how many coins people could order.
But, as we reported last week, that didn't solve the problem.
"When we undertook these aggressive actions initially we felt that would solve the issue," U.S. Mint spokesman Tom Jurkowsky told me. "It obviously didn't ... This is the next logical step."
Payment must now be by wire transfer or check. More than a billion dollar coins are sitting in government vaults, unused.
Planet Money's Wall-To-Wall Dollar Coin Coverage:
How Frequent Fliers Exploit A Government Program To Get Free Trips
Dollar Coin Loophole Closes For Frequent Fliers
Bill Would Kill Dollar Coin Program