posted: Nov. 10, 2006 @ 2:48p
Shaz said:mybuds said:Does anyone see problems with friends selling each other items at inflated prices to rack up credit card points?
The terms of service requires only that a transaction include a product sold to a bona fide purchaser. I forgot most of what I learned during property class in law school, but I believe a bona fide purchaser can make a nominal payment and does not have to pay fair market value. Therefore 2 parties may mutually sell items of little value for say $5000 to each other, earning 5000 free credit card points each.
I see no legal or TOS issues, although Google does reserve the right to impose transaction dollar amount limits. And I assume if they see this happening, they will limit individual or aggregate transaction amounts, closing the "loophole."
The limiting language in the terms of service is "GPC may establish general practices and limits concerning use of the Service, including without limitation individual or aggregate transaction limits on the dollar amount or number of Payment Transactions during one or more specified time periods."
Are there any tax issues? Does Google report large sales?
Why even bother with getting a friend to do it? Why not just charge yourself? What would stop me from signing up on this and charging a few hundred dollars to each of my credit cards? It would be an easy way of doing my first $250 purchase on my new United Miles Visa and my new Starwood card.
I'll address your questions in two parts. First, Google will not let you purchase from yourself. You could open a second account to circumvent their rules, but doing so may be a violation of the user agreement. Second, funneling money through Google Payments without a legitmate purchase is much more suspect than conducting an actual sale. The user agreement expressly requires a sale of a product. When making the most of promotions such as these, it is best to play by the rules.