Airmile hackers use mileage credit-cards to buy $1 coins that they use to pay the CC bills

Airmile hackers figured out that they could buy dollar coins (free shipping!) from the US Mint, using credit cards that gave them airmiles for purchases. Then they took the dollar coins straight to the bank and deposited them, paying off the credit card bills before any interest was incurred. The only cost was gas for the bank-runs. The Mint has tried to put a stop to it.

I love hanging out in airmile hacker forums — these folks are insane. My favorite is the British Airways "Lisbon Loop." BA wants to court continental passengers, so trips overseas that originate from continental Europe are much cheaper. BA flight hackers claim that they buy a BA ticket that goes Lisbon-London-NYC-London-Lisbon, and a one-way cheap EasyJet ticket to Lisbon so they can board it. On the way home, they just get off in London, saving a bundle (you can't skip the Lisbon-London leg, or BA will cancel your tickets).

Another exploit for BA's desire to woo continental passengers is for Brits to register a PO Box in France and use that as their address for the BA frequent flier club. People who live in continental Europe level up to perks much faster than people in live in Britain. For the cost of an annual PO Box, you can save thousands of pounds on getting into the lounge and getting free massages, meals, etc.

One FlyerTalker, identified by his online moniker, Mr. Pickles, claims to have bought $800,000 in coins. He posted pictures of the loot on FlyerTalk.

He says his largest single deposit was $70,000 in $1 coins. He used several banks and numerous credit cards. He earned enough miles to put him over two million total at AMR Corp.'s American Airlines, giving him lifetime platinum-elite status — early availability of upgrades for life and other perks on American and its partners around the world. He also pumped miles into his account at UAL Corp.'s United Airlines and points into his Starwood Preferred Guest program account.

Miles for Nothing: How the Government Helped Frequent Fliers Make a Mint

(via Kottke)

(Image: Dollar Coins "In God We Trust", a Creative Commons Attribution photo from cometstarmoon's photostream)