Amazon Payments Shut Downs and Tips to Avoid Them

 

Amazon Payments can help meet minimum spend for new credit card signup bonuses, since you can send up to $1000 per month via credit card with no fee (unlike Google Wallet, which now charges a fee) but be careful: there have been reports on Flyertalk and Dan's Deals of recent account shutdowns. Some of the key triggers for the shut downs appear to be:

  • Sending money back and forth between two accounts (this has long been known to prompt a shut down)
  • Logging into multiple Amazon Payments using the same IP address
  • Using the same bank account for the different accounts
  • Using the same credit card for the different accounts
  • Having too many accounts open with the same SSN

While, to be honest, I use Amazon Payments only occasionally and for legitimate transactions, since we meet minimum spends even without Amazon Payments, here are some tips gleaned from others' experiences: 

Tips

  • Set Up a Unique Amazon Payment Account for Each Person: different SSN, credit card and bank account (see above risk factors)
  • No Sending Money Back and Forth: As noted above, this is pretty much guaranteed to lead to the shutdown of both Amazon Payments accounts. Instead, you'll want to set up a chain, for example A > B > C > D > A where A, B, C and D are all different Amazon Payments accounts, each with a unique SSN, bank account and credit card. Or simply send the occasional payment A > B if you are spouses/partners, as long as you don't send funds back and forth.
  • Use a Different IP Address: A red flag can be multiple account logins all using the same IP address, so either have each person log in under a different IP address or buy a VPN service that will change your IP address.
  • Browse Incognito: To avoid cookies, which could also track you, consider browsing incognito. Use the keyboard shortcuts Ctrl+Shift+N (Windows, Linux, and Chrome OS) and ⌘-Shift-N (Mac) to open an incognito window.
  • Withdraw Funds Promptly: While withdrawals aren’t authorized immediately, as soon as the money does appear in the recipient’s account, ensure that it’s withdrawn right away to the bank account. Also note that if the recipient doesn’t claim the money promptly, it will be returned to the sender.
  • Take Screenshots: Take a screenshot of your account(s) and have anyone you send money to also take a screenshot of their account when sending money. One Dan's Deals poster reported that after sending money it showed “pending” for the sender and “completed” for the recipient, but that the money wasn't received and Amazon suspended his account, then removed the entire transaction so that there appeared to be no trace of it. Fortunately, he had screenshots of both accounts, and that helped him receive his $1000 back.
FAQ
 
Is the $1000 Limit Every 30 Days or Per Calendar Month?

Per calendar month; so on the 1st of every month you're again able to send up to $1000.
 
 
Do I Have to Verify My Bank Account to Be Able to Send Money?
 
No, but if you don't connect your bank account your maximum send money limit will be $500 per month.
 

How Do I Ensure I Don't Get Charged Fees for a Cash Advance?

Make sure to select “Good and Services” when sending money. Also, it's always a good idea to set your credit card cash advance limit to zero to ensure you always avoid cash advance fees.


Can I Use Amazon Gift Cards to Send Money Through Amazon Payments?
 
No–you need to use either a credit card or an AMEX, Visa etc. gift card. Amazon gift cards may only be used for actual Amazon merchandise, not for Amazon Payments.
 
 
Can I Use My Chase Freedom to Get 5X When Sending Money Via Amazon Payments?
 
No–the Freedom 5X bonus is only for actual Amazon.com spend on merchandise, and is not applicable to Amazon Payments, which is a separate entity. See Amazon 5X Points: Activate Chase Freedom Q4 5X Bonus and Tips
 
 
I've Heard an AMEX Credit Card Could Trigger a Financial Review; Could I Buy Gift Cards Using AMEX and Use Those?
 
Yes, you can add gift cards to your Amazon Payments account and use those to send money. 
 
 
I Got an Error When Trying to Send Money Due to the Recipient's Credit Card Data Being Invalid. Why Does the Recipient Need a Valid Credit Card if S/He Will Withdraw Funds to a Bank Account Anyway?
 
Amazon does require that both the sender and recipient have a valid credit card on file. Ask your recipient to update his/her credit card details with a valid credit card.
 
 
I Received a “Pending” Message–Should I Worry?
 
If you receive a “We are unable to complete your transaction until further review. It can take up to 24 hours to complete this transaction….” message, this is common. It can take several hours for it to go through, so just be patient.
 
 
Do I Risk Receiving a 1099?
 
No, not unless you receive over $20,000 per year and have over 200 transactions.
 
 
Bottom Line: Ultimately, you'll have to decide if the hassle and risk of being shut down is worth it to you given that Amazon seems to be cracking down on those it perceives as excessively gaming the system. I just hope that the current no fees for up to $1000 per month, using a credit card, remain.
 
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