Posted by Chuck on November 3, 2017
Manufactured Spending

Published on November 3rd, 2017 | by Chuck

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[Now Hard-Coded] New USPS Memo: Gift Cards are Not Accepted to Buy Money Orders

[Originally posted 11/2/17. Reposting 11/3/17 since it’s now hard-coded, at least is some areas, maybe everywhere. Seems to have happened overnight since yesterday 11/2 people were still having success. See data points in this Reddit thread.]

Milesperday just posted a memo which was sent out (regionally?) indicating that prepaid gift debit cards are not a valid debit card to buy money orders at the USPS. The memo also states that it will be hard-coded soon into the registers not to accept prepaid cards for money orders. 

The memo also gives tips to the cashiers so they can recognize someone who is using a gift card:

  • If a customer has a stack of debit cards, preloaded for $500 or $250 each, and they want to buy money orders with them, they are almost certainly not linked to the customer’s account.
  • Gift cards do not normally have the chip embedded in them.
  • Gift cards do not have the customer’s name on them.
  • Gift cards will of then say so on the front of the card.

For now, it could still be possible to buy money orders at USPS depending on the cashier, but keep this in mind before you load up on gift cards, and ensure you have a backup plan.

USPS money orders are the favored method of most heavy MSers for the past year or two. This is partially due to the fact that Walmart got more difficult to deal with, not all cards work anymore at Walmart, and additionally, Amex stopped allowing MS on Bluebird/Serve cards. Another factor is that at some point in the past few years the USPS system was updated and in the process began allowing many more prepaid debit cards as payment methods than had been previously allowed.



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Ugh. omg. What the hell am I supposed to do now?

I predicted at the beginning of 2017 that all VGC–>MO options would be dead within 2 years. Walmarts in my area have cracked down and looks like USPS is as well.

Accepting business partners for a business that only sells VGCs and MOs…

I’m in on that business!

It wouldn’t be that profitable. I have a friend of a friend who is willing to run a few thousand of debit VGC a month in return for cash (from a business, basically converting cash sales into card sales with a net zero impact) and will charge 1.5%. The big players have signed these special deals for debit payments, but small businesses don’t have access to those.

This is horrible news. Hope that hardcoding takes a long time 🙁

I thought Metabank gc were already hard coded not to work. They haven’t worked around here ((NJ) for a while now.

yeah, the image shows a Metabank (possibly a Sunny). USPS stopped taking those a while ago

I got a MO this morning and saw they had a new POS software interface. Knew that couldn’t be good

Al, did your transaction still go through? Any problems given by the clerk?

Also, general location?

Appreciate the DP

I noticed the new software interface at my local USPS last week but was able to do a split payment for my MO as usual. I haven’t tried again since, however.

WHAT THE FUCK.

Seriously, FUCK USPS. They benefit from these transactions. There is no actual fraud problem (this reminds me of “voter fraud” if anything). A number of smart savvy consumers are benefiting from a service USPS provides. As a result, they can’t stand that and are trying to kill it. Does every government (or… closely tied to government) organization want nothing but inconvenience and irritation from regular people?

It’s a combination of spite at savvy consumers and maybe pressure from banks. We are the citizens, not the banks. This sort of action is detestable.

Angry, bitter and stupid is no way to go through life.

REMAIN CALM ALL IS WELL

While I don’t MS, it has always been hard for me to imagine this on a number of levels. For one thing, it’s the mere perception of fraud or suspicious activity that they or any other supplier/merchant is trying to avoid. You aren’t committing fraud but to anybody reviewing the activity, it’s an obvious red flag, just like buying the same amount over and over on an Amex card is a red flag for their RAT.

I personally would not be able to handle the anxiety of carrying around thousands of dollars in Visa/MC/Amex gift cards to liquidate, but that’s just me. We all have different risk tolerances. If just one of these $500 cards goes missing or doesn’t work, whether because of actual fraud by someone else, then your profit margin is gone just like that.

But if I’m somebody in risk management at the USPS, I would ban this stuff too. It’s definitely suspicious activity and as such can give auditors the perception of fraud and it’s not something anybody there wants to manage.

On top of this, I would never mess around with the USPS. I think it’s one thing to play games with Walmart or CVS but I wouldn’t want to make the USPS mad. I’ve read some bad stories about it and I wouldn’t want a government official at my door over…whatever.

I used to work at a bank. If you see something suspicious, that is out of the ordinary, it is supposed to get reported, if not to the government, to a bank official. MS methods are simply not normal, and unlinked debit cards represent risk to all involved parties. If done in volume, I can understand why the USPS doesn’t want to be part of that.

Yes, if you mess with USPS, the people they send are Postal Inspectors. A nice-sounding name, but they can be very intimidating if they want to – and yes, they are law enforcement officers.

If you’re not breaking any laws, what’s the worry?

Having to prove you are not breaking any laws when you are innocent, no thanks. I’ve never done USPS money orders.

They have to prove that you committed fraud or any illegal acts. Paying MO with VGC is not illegal nor a fraud.

when it comes to cash, “they” dont have to prove jack squat. Carrying large amounts of cash is reasonalbe suspicion

I wouldnt want Newman coming to my door either.

You are obviously not a “regular person”. There are certain regulations institutions dealing with money have to enforce. Don’t forget what MSers do is often what money launderers do as well, minus the legality and intent.

The $500 VGC churning will be over before too long. After that, you’ll be able to use your Chase Freedom and Ink 5% categories (maybe) and that will be it.

Wrong. Please look into what money laundering is and stop spouting this bullshit.

Why do ppl keep saying this MS looks like ML? How exactly? Do criminals use cash to buy gc in order to get MO??? Then shouldn’t we make gc sale cc and dc only? Lol

Criminals don’t use cash to buy gift cards, they use stolen credit cards. The also spoof gift cards. And then some of them unload them at USPS into a money order.

It’s probably not so much the fraud problem, since that’s actually impossible. Pin based transactions can’t be chargebacked, that’s like saying your atm withdrawal can be chargebacked. But, the swipe fees are always more than the MO fees. The MO fee is ~0.15%. Their swipe fee is guaranteed higher than that. Their losing money every 1k MO.

If that were the reason, they would ban ALL debit card purchases for MO, not just gift cards. The swipe fee is the same for all PIN-based transactions. The fact that regular debit cards will continue to be allowed suggests that they’re worried about something else, not the swipe fee.

Another clockwise turn on the spigot for consolidating GCs. This appears to take effect immediately, although some USPS terminals are not hard-coded yet.

I’m out. Nice knowing everyone

The Horror…

Here’s the F101 document referred to, which states that pin based debit cards are allowed but never specifically calls out gift cards: https://www.apwu.org/sites/apwu/files/resource-files/F-101%20Field%20Accounting%20Procedures%2010-13.pdf

I suspect that the personalized gift cards bought at giftcards.com and GCM will still work, but it will likely be similar to WM where suspicious cashiers will check for a name.

GC.com and GCM are all Meta now… so good luck with that.

Are they hardcoded against Meta? I also thought they had some MCs?

The PO has been hardcoded for Metas for about a year(?) now but Bancorp vanillas are still working. It’ll definitely arouse suspicion now if one does split payments of $500 each, one swipe of non Meta VGC may still work as long as the cashier does not ask to see the card.

I was just about to post this, any pin-based debit cards should work… that’s the ‘official USPS policy’

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This is from Oct 2013. They send out updates periodically. I haven’t been able to locate a newer version (in entirety) yet though

bought 4 k at 2 different PO this AM. Used 8 OV cards. No problem. Upstate NY. Saw new software has been installed, but still worked fine. The clerks here never ask to see any card I use. Hope this update takes forever.

Thank for the DP.

If I may ask, how did you know there’s new software installed?

the terminal has a different look: a small icon on bottom right, the dots when you input pin are now big stars and the screen asking to swipe card is not dark as before.

Did you fill out the form (I’m too lazy to look up its number)?

One thing I’ve absolutely never done is buy $3k of MO in a day from different POs to avoid filling out the form. It’s one thing to get shut down by AmEx or Chase; quite another to run afoul of the feds.

What is OV card ? Thanks

One vanilla bought from grocery stores and drugstores.

Can I know your zip?
I am in Upstate NY too, get denied this morning…

Same here in NJ this afternoon.

barrytuneup – hey, do you split the payments, just curious, buying $1,000 money order using 2 prepaid cards or you just buy one MO for $500?

Bummer. Even with a friendly local USPS office, I am glad I decided to switch to bank account funding as my primary means of MS, strictly for sign-up bonuses. I’ve never been interested in MS beyond that.

Bye bye Estella and Mary. I will miss those day when I see you everyday 🙁

Are those ladies hot?

They work at a USPS – of course they’re not. They’ve been sitting on their butt at the counter for 30 years.

DP: OneVanilla by bancorp was rejected yesterday. I tried 2 different USPS in my area, all the same.

what state/area do you live in?

My OVs worked just fine at USPS in Beverly Hills.

Good. If I never hear the phrase “manufactured spending” again, it will be too soon.

leave and don’t return, you jealous bitter a-hole

Nothing to do with being bitter and jealous. I have a fistful of credit cards and could have MS’d like crazy. The whole thing was an absurd loophole and it’s nuts it lasted so long.

People flying first class all over the world after buying and liquidating gift cards. Loony tunes.

Thanks for clarifying you’re not bitter and jealous. Just bitter, jealous, and too lazy or self-hating to do it yourself.

Ha ha ha ha.

Someone’s mad the gravy train is grinding to a halt.

Well I frequently fly economy and on occasion business on very long hauls. Most of my points come from CC sign ups and work purchases. Those first class flights are either memories or sales pitches of credit card selling blogs 😉

Well, as a MSer, I thought it was nuts too. But it’s legal, the banks didn’t object and willingly gave tens of millions of points and substantial cashback. It’s beyond laughable that banks incentivised sales and not profits, but that’s how their bonus pay/options were set up by their Boards. It was the more the merrier and who cares about shareholders? Who are we to criticize their decisions? Or worse yet, be stupid enough to fail to accept their largesse? About time some clued-in consumers were able to loss center. I get as much pleasure knowing I’m a huge loss center to some bank as I get from travel. 😉

Angry, bitter and stupid is no way to go through life.

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