End of the road for US Mint Frequent Flyers

End of the road for US Mint Frequent Flyers

If you are completely unaware of what was happening with the US Mint, I suggest you listen to this NPR podcast which explains what it was in detail.



Buying $1 coins at face value with free shipping from the US Mint using a mileage earning credit card had been around since 2008, but it has come to an end today.  As I mentioned in a previous post, this program could not really support the weight of everyone exploiting it.  It would have been best for people to simply order small amounts to meet minimum spending requirements on new credit card.

 

Here is the official notice from the US Mint's website:

The United States Mint has eliminated the credit and debit card purchase of $1 Coins through its Direct Ship Program effective July 22, 2011. Customers who wish to purchase $1 coins through the Direct Ship Program can still do so by wire transfer, check, or money order. Customers who wish to purchase the coins by wire transfer may fax their order to: (202)-756-6585. Customers interested in purchasing by check or money order may do so by writing to:

United States Mint
PO Box 71192
Philadelphia, PA 19176-6192

Please download the order form and follow the instructions provided on the form. (Order Form).

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 has undertaken several aggressive internal and external actions to mitigate this issue, including restricting chronic and repeated use of credit cards, contacting customers who frequently placed large numbers of orders to ensure they were using the coins for legitimate business purchases, and other measures. While these measures eliminated a significant amount of misuse in the program, we believe some abuse still exists. Eliminating the credit and debit card purchase of the $1 coin is the next step in our efforts to root out abuse in this program and ensure it is better targeted toward fulfilling its intended purpose—which is to get the $1 Coin into greater circulation.

Thank you for your understanding and your continued support of the $1 coin program.

The United States Mint

The reason the Mint was selling these coins at face-value with free shipping was to encourage people to buy some and get them into circulation.  The ultimate goal was to get enough of these coins in circulation so that they would replace the $1 bill, because coins last longer than bills.  The problem here is that the only people who would actually go through the hassle of voluntarily acquiring thousands of $1 coins were the frequent flyers.  Now that the Mint has killed this program, it is my belief that the $1 coin will never replace the $1 bill.

If you used the mint to meet spending requirements, rest assured there will be something to replace this.

-Jason of TWiBT